Finance Minister Mihály Varga said Hungary’s economy is expected to grow by 3-4% in 2024.
Minister Varga told the Official Monetary and Financial Institutions Forum (OMFIF) that Hungary’s economy rebounded quickly after the coronavirus pandemic. In 2021, the country’s GDP jumped by 7.1%, he added. The conflict in Ukraine dampened growth, but Hungary is expected to expand again in 2024, he added. The labour market remained stable, with a low unemployment rate and a 75% employment rate, he said. Inflation peaked at 25.7% in January and fell to 9.9% in October, he said. The current account balance has improved in the first half of 2023, and the foreign trade balance is expected to hit a record. Hungary’s investment rate is the highest in the European Union, and it is expected to grow further, thanks to a 9% corporate tax, the lowest in the EU, he added. The ESA deficit is expected to come to 5.2% of GDP this year and fall to 2.9% in 2024, he said.
Barnabás Virág, the deputy governor of the National Bank of Hungary (NBH), told the forum that breaking down inflation has been a challenge in central Europe. The fact that it is around 3% in the eurozone and the US is a good sign, he said. Inflation is expected around 7% in Hungary in December, he added. Three-month core inflation has fallen below 4%, he added. The base rate is expected to be below 11% by year-end, and in single digits by February, he said.