Magazine: GKI calculates with better-than-expected years to come

Due to the great rise in the level of investments in the 2nd quarter of the year, GKI raised its growth forecast from 3.5 percent to 3.8 percent for this year and they expect a similar rate for 2018. This speed is much faster than the 2 percent growth in 2016, and it results from the new influx of EU funding and the revitalisation of demand before the parliamentary elections. However, it must be noted that despite the fact that the Hungarian economy’s growth rate is higher than the EU average, at a regional level this performance is rather modest.

Hungary’s competitiveness kept decreasing in 2017. Economic expectations are very positive in both the EU and Hungary. In 2017 gross wages will grow by 13 percent and real wages will increase by 10-11 percent in Hungary. Hungarians’ real purchasing power will increase at a lower rate though, because the whitening of the economy and other income types are expanding slower or they are in stagnation. Consumption will grow by 3.5 percent (last year the expansion was 4.2 percent in this respect). //

_{Attila Udvardi
research leader
GKI}