Hungarian Central Bank Cuts 2026 Growth Forecast to 1.7%

LootboxPhobia · 2026-03-24T22:39:16+00:00

Hungary's central bank lowered its 2026 GDP growth forecast to 1.7% and emphasized the need to maintain tight monetary policy to stabilize foreign exchange markets and curb inflation. Inflation is expected to rise in Q3 2026, driven by energy price increases, with growth prospects facing downside risks.

LootboxPhobia

2026-03-24 22:39:16

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Investing.com – The Hungarian Central Bank announced on Tuesday that it has lowered its GDP growth forecast for 2026 from 2.4% to 1.7%.

The central bank stated that it will make decisions on the benchmark interest rate cautiously and based on data. The bank added that maintaining a tight monetary policy environment is necessary.

The bank emphasized that maintaining stability in the foreign exchange market is crucial for curbing inflation expectations. It further added that a stability-oriented monetary policy approach is needed.

The central bank indicated that starting from March, due to the pass-through effects of rising energy prices, the pace of price increases will accelerate. The bank noted that implementing fuel price caps will temporarily mitigate this impact.

The bank forecasted that from the third quarter of 2026, inflation will rise above the tolerance zone. It added that inflation is expected to gradually return to the central bank’s target level in the second half of 2027.

The central bank stated that the baseline scenario forecasted in March mainly faces upside risks to inflation and downside risks to growth.

The bank also noted that soaring energy prices are weighing down on Hungary’s export market growth.

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