Takarekbank says Hungary’s GDP to grow 0.3% this year, 2.9% in ’11

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Takarekbank expects Hungary’s GDP to grow 0.3pc in 2010 and 2.9pc in 2011, Takarekbank Senior Analyst Gergely Suppan said on Thursday.

Hungary’s government projects GDP contraction of 0.3pc in 2010.

Mr Suppan said that Takarekbank expects the eurozone GDP to grow 1.1pc in 2010 and 1.8pc in 2011.

Bank analysts expect average inflation of 3.8pc in 2010 and inflation of 2.6pc at the end of the year. The National Bank of Hungary’s base rate could fall to 5.5pc by the time of national elections in April.

Mr Suppan predicted that Hungary’s unemployment rate will be 11.2pc in the spring and average 10.8pc for the year. The Takarekbank analyst said that the government will likely be able to meet its projected deficit of 3.8pc this year, adding that Hungary’s debt as a proportion of GDP could shrink if the forint strengthens. The forint will likely trade at around 260 to the euro at the end of the year.

Takarekbank department chief Zoltan Adam said that Hungary could join the ERM-2 exchange-rate mechanism by 2012 if the country’s macroeconomic conditions improve, adding that in this event Hungary could introduce the euro in 2015.

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