GKI expects a 3.5% drop in purchased consumption in 2024

By: Trademagazin editor Date: 2024. 03. 18. 12:01

In its late December publication, GKI essentially confirmed its September forecast for 2023-2024. GKI lowered its inflation forecast from 18% to 17.7% in 2023 and from 7% to 6.5% in 2024, while the company expects the GDP to contract by 0.5% in 2023 and expand by 2-2.5% in 2024.

This article is available for reading in Trade magazin 2024/2-3

The fact that the Hungarian economy is expected to contract by only around 0.5% in 2023 is due to an agricultural GDP growth of around 60%. GKI hasn’t changed its forecasts for household consumption at -1.5% (but from this purchased consumption standing at -3.5%) and +2% in 2024.

As regards inflation, the 6.5% projected for 2024 is only a little higher than the government’s 6% prediction, but the main difference is in how inflation will develop: GKI expects inflation to fall very modestly between 2023 and the end of 2024. The Central Bank of Hungary (MNB) has been following a very cautious interest rate policy for a year now. In 2023 the general government deficit won’t just be higher than previously expected by GKI, but at 5.7% probably also higher than the government’s forecast of 5.2%. //