WIIW The Vienna Institute for International Economic Studies - Wiener Institut für Internationale Wirtschaftsvergleiche

In early 2023, Hungarian inflation was the highest in the EU. Measures to rein in inflation have been unavoidable, but do little to encourage growth. Both consumption and investment will fall this year, and the only positive contribution to GDP change will come from foreign trade, where deficits are expected to shrink substantially. This year will be split between recession in the first half and moderate recovery in the second. EU transfers continue in limbo. A new industrial policy aimed at facilitating the FDI-based mass production of batteries for electric cars has the potential to turn into a costly fiasco.