Hungary think-tank cuts 2006 import growth, trade gap projections

The GKI said reforms and fiscal adjustment were expected after elections in April, which would create room for further rate cuts.

The GKI has upped its forecast for this year's industrial output growth to 7.5% from 7.0% in the previous projection a month ago.

However, it cut its annual import growth estimate (at current prices, calculated in euros) to 11% from 12%, while keeping its export growth projection unchanged at 11%.

The GKI said Hungary's trade deficit would be EUR 3.1 billion in 2006, while a month ago the forecast was for a gap of EUR 3.5 billion.

The GKI has slightly reduced its average EUR/HUF exchange rate estimate to 248 from 250 and left both its CPI and jobbless rate forecasts unchanged at 3% and 7.2%, respectively.

Real wages went up by 6.3% in 2005, party due to the fact that 13th month wages in the public sector were paid out at a different time than usual. In the private sector, real wages increased by 4.5% year on year in 2005 (similar to the rate in the public sector when 13th month payments are excluded) and the GKI said this would not change much in 2006, either."


Source: Portfolio.hu Online Financial Journal

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