IMF Staff Country Reports

Hungary: 2024 Article IV Consultation-Press Release; and Staff Report

August 2, 2024

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Format: Chicago

International Monetary Fund. European Dept. "Hungary: 2024 Article IV Consultation-Press Release; and Staff Report", IMF Staff Country Reports 2024, 268 (2024), accessed September 16, 2024, https://doi.org/10.5089/9798400283703.002

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Summary

Hungary is emerging from a period of shocks. The pandemic, Russia’s war in Ukraine, and crisis-related stimulus widened fiscal and external imbalances and triggered double-digit inflation in 2022. Thanks to an effective monetary policy response aided by falling commodity prices and a tighter fiscal stance in 2023, inflation came down significantly, while the labor market and financial sector remained resilient. A large current account deficit in 2022 turned into a surplus, and output is starting to recover. However, significant challenges remain. The fiscal deficit and public-debt-to GDP ratios are well above 2019 levels, and various windfall taxes have created investor uncertainty. Interest rate caps and subsidized lending measures have distorted market rates, and a significant state presence in key sectors impedes competition.

Subject: Financial sector policy and analysis, Financial sector stability, Housing prices, Inflation, Prices, Public debt

Keywords: Audit oversight, Control environment, Europe, Financial sector stability, Global, Holdings of SDR, Holdings rate, Housing prices, Inflation, Inflation pressure, Safeguards assessment of the Magyar Nemzeti Bank

Publication Details

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