Hungarian GDP could fall almost double this year than according to the latest forecast, according to the IMF’s just released forecast. For the moment, the global economy, thanks to quick and effective crisis management, seems to be able to escape a financial catastrophe like the one in 2008.

The International Monetary Fund (IMF) sees the future of the Hungarian economy much worse than before. The spring forecast also said that GDP could fall 3.1 percent this year and grow 4.2 percent next.

In another recently published analysis, the IMF expects a decrease of 6.1 percent for 2020 and an increase of 3.9 percent for 2021. That is, by the end of 2021, the performance of our economy will be 2.4 percent lower than at the end of 2019.

This is a much more pessimistic forecast than the latest forecast from the Finance Ministry, which says the drop could be 5.1 percent this year. The Magyar Nemzeti Bank estimates that the recession may be around 6 percent this year, but according to them, growth will be 5 to 6 percent next year.

As for the other important economic indicators: according to the IMF, inflation hardly changes in Hungary, it will rise from 3.4 percent last year to 3.6 this year, and then back to 3.4. Unemployment will rise from 3.4% to 6.1% in 2020 and will fall to 4.7% in one year.

The IMF is already more optimistic about the situation around the world. So far, the recession has been estimated to be 4.9 percent this year, but next year we will only go back above the 2019 level. Even now, the global economy is expected to be in a slightly better position by the end of 2021 than in 2019, but will have to hold on to a 4.4 percent recession this year.

Of the world’s major economies, China is the easiest to swim in crisis, there will be no recession this year, and next year’s growth could be above 8 percent. Of the big Western European countries, Germany may have the least damage, but by December next year, they will only be able to fight for 98 percent of 2019 GDP. Central Europe can do much better, but Hungary is not happy:

We will overtake Croatia in our region if the IMF is right, the Austrian recession may be the same as the Hungarian, the Czech, Slovak and Slovenian recessions will be much smaller, and the Polish and Serbian economies will be in positive territory by 2021 compared to 2019.

If we look only at the forecast for 2020, half a year ago the IMF said that the economic recession in the EU would be less than in Hungary. Since then, we have not been that good in international comparison, we are 14th in the EU.

To prevent 2008-09

According to the analysis, the world’s financial leaders have moved relatively quickly and well, deciding unprecedented significant changes in monetary and fiscal policy. The main objective was to keep households with sufficient disposable income, companies with enough money, and to get credit for those who need it in order to save as many companies and households as possible in the short term. It also requires global players to allow higher-than-usual public debt and budget deficits.

The authors of the report come to take these steps together to prevent a financial disaster like the one of 2008-2009.

They also add what all the other analysts highlight: while the coronavirus is spreading, we cannot be sure of an economic recovery either. Despite the reintroduction of stricter epidemiological rules in more and more places with the arrival of the second wave, much better economic data will surely be obtained in this third quarter of this year than we expected so far. The question, according to the IMF, is to maintain crisis management measures for a long time. Thus, although GDP will decline in the short term, unlike previous recessions, it will be possible to ensure that the financial situation of households and companies does not collapse.



The number of independent publishing offices of power is steadily declining, and those that still exist are trying to stay afloat with a growing headwind. At HVG we persevere, we don’t give in to pressure and we bring national and international news every day.

That is why we ask you, our readers, to support us, support us, join our membership and renew it!

And we promise to keep doing our best for you in all circumstances!

According to the MNB, the startup wave is approaching now, hundreds of thousands of people could take to the streets


Gábor Kovács
Economy

The central bank no longer expects a rapid economic recovery: there will be a recession in 2020, businesses will begin to shrink, real household incomes will fall, and inflation will remain high until 2022, according to the forecast just released. Prices may fall further if the forint weakens more than expected, and the economy may recover even more slowly if the epidemic triggers another low.

IMF: coronavirus is causing an even bigger crisis than we anticipated so far


hvg.hu/MTI
Economy

The International Monetary Fund expects a much bigger recession than previously expected in its just released forecast for the world economy. Of the big economies, only China can swim with the fact that its GDP is slowing but growing.