Hungary's Revised Growth Forecast#
Hungary’s central bank has adjusted its 2026 GDP growth projection from 2.4% to 1.7%. This change reflects concerns about economic conditions and inflation.
Cautious Monetary Policy#
The central bank emphasized that it will approach decisions regarding the base interest rate with caution, relying on data to guide its actions. They believe it is necessary to maintain strict monetary conditions to support economic stability.
Inflation Concerns#
The bank highlighted the importance of stabilizing the foreign exchange market to manage inflation expectations. They anticipate that inflation will rise due to higher energy prices, although this effect may be temporarily lessened by price caps on fuels.
Future Inflation Predictions#
Looking ahead, the central bank expects inflation to exceed acceptable levels starting in the third quarter of 2026. However, they predict that inflation will align with their target by the second half of 2027. The central bank's current outlook includes significant risks related to inflation and growth, with rising energy prices impacting Hungary’s export markets.