Forecast for 2021

Due to better-than-expected Q4 data last year and relatively favourable economic expectations at the beginning of this year—despite the third wave of the pandemic and mixed data—GKI raised its growth forecast for 2021 by 0.6 percentage points to 4.3 per cent (4-4.5 per cent) compared to the end of last year. This brings Hungarian GDP close to, but not yet at, its 2019 level. The main negative risk of the projection is that the substantive restrictions caused by the pandemic will persist for a while in the second half of the year (either in Hungary or in its main trading partners). However, the approaching elections in 2022 may have a stimulating effect by encouraging the government to further loosen fiscal policy. More…