Hungary’s credit rating getting better

According to a forecast by GKI Economic Research Zrt., after the 3.6-percent growth in 2014 and the 3.5-percent expansion in Q1 2015, this year a 2.7-percent economic growth will be produced by Hungary. The main reason of this slowing down is the stagnation in investment. At the same time consumption is speeding up and it is rather likely that Hungary’s credit rating will improve either already in 2015 or in 2016. If we take a look at April-May 2015, we can see that retail trade slowed down 1 percentage point and if measured in euro, there was a 4 percentage-point export drop. Real wages’ growth rate was 3 percent last year – this year will bring a 2-2.5-percent growth, but consumption is expected to grow from 1.6 percent to 2.5 percent. In the first five months of 2015 2.7 percent more people were employed than a year before. Although consumer prices have been decreasing since April 2014, in May they increased by 0.5 percent and in June prices rose 0.6 percent. The forint-euro exchange rate keeps worsening, one euro was HUF 307.4 in the first half of 2015 and for the second half of the year a HUF 310-315 exchange rate is forecasted. Hungary’s budget deficit will be around the targeted 2.4 percent in 2015.