GKI expects slower growth, higher inflation and a larger public budget deficit than the government thought

Economic policy – no new strategy. According to the government, the challenges of Hungarian economic policy can be traced back to external causes. Thus, a new economic strategy will not be developed to replace the failed re-industrialization program. As a result of the government’s severely restricted room for maneuver and the conflict between its growth-stimulating and balance-improving goals, it returns in practice to a moderate inflationary economic policy.

Consumption – 2% expansion is expected. In addition to an 11% increase in earnings and a 5.5% increase in inflation, real earnings may rise by more than 5% in 2024. The real value of pensions is expected to increase by around 0.5% compared to the increase at the beginning of the year (6%) due to slightly lower inflation (the payment of pension premiums will not be possible due to the almost certainly below 3.5% GDP growth), entrepreneurial income and social benefits however, its real value tends to decrease. Thus, real income increases by around 3%, and purchased consumption slightly less (around 2.5%).