Foreign debt is shrinking

According to a forecast by GKI Gazdaságkutató Zrt. and Erste Bank, the Hungarian economy will stagnate in 2010. Depending on the economic policy of the next government, budget deficit will probably be 4-5 percent of the GDP. In the Hungarian economy industrial production started improving in the 3rd quarter of 2009 and the GDP presumably did the same in the 4th quarter. This year building and construction could be the most dynamic sector. Consumption will probably shrink, gross wages will improve by 1 percent, but net wages will be 7.5 percent higher, resulting in an approximately 3.5-4-percent rise in real wages. In 2009, the consumer price index was 4.2 percent on an annual average. Inflation will remain 4-5 percent in the first half of 2010, but from the middle of the year it will be reduced to 3 percent.