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New Restrictions In Hungary To Hurt Business Growth Target

• 9 Mar 2021 12:00 PM
• Hungary Around the Clock

Lockdown measures announced on Thursday may endanger the government’s growth target for 2021, Világgazdaság writes, citing analysts.

GDP growth could have been 5.5% this year, but with restrictions extending beyond two weeks, the 5% target is in danger, said Erste Bank senior analyst Orsolya Nyeste.

The official growth target is 5-5.5% for 2021, but the government is expected to update its planned economic trajectory in the convergence programme on April. 1.

January retail sales came in below forecast and the two-week shutdown of stores could further hurt the sector, ING Bank analyst Péter Virovácz observed.

The closures will inevitably lead to a quarterly drop in GDP in the first three months, he added.

He surmised that the economy could stage a sharp rebound in the summer and reach pre-crisis levels at the end of 2021 or the beginning of 2022. Overall, ING expects 3-4% GDP growth this year.

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