Faster than expected growth

In the 1st quarter of 2017 the Hungarian GDP increased by 4.1 percent, faster than originally expected. Thanks to this GKI has modified its annual growth forecast to 3.5 percent. In the first quarter the building and construction sector expanded by a spectacular 25 percent. However, retail sales only grew by 3.4 percent, less than in the same period last year. Real wages elevated by 8 percent and the number of people employed augmented by 2.5 percent.

In the 2014-2016 there was practically no inflation, but by the end of last year inflation started to grow and in February 2017 a 2.9- percent rate was measured. For the year 2017 a 2.5-percent inflation level is predicted. In February-April 2017 the unemployment rate was 4.6 percent, 1.3 percentage points lower than a year before but 0.2 percentage point higher than in the last quarter of 2016. The level of ‘real’ unemployment remained to be around 7 percent. //

_{Attila Udvardi
head of research
GKI}