The Hungarian economy in 2024 through the eyes of hungarynow
Over the past year, the Hungarian economy has not performed well. Growth has fallen short of projections, and investment has also declined significantly.
Although the inflation rate has started to decline, the forint has weakened against foreign currencies, which will be a source of further problems in 2025.
Hungarian economic policy continues to view the production growth of electric car and battery factories as the primary driver of GDP growth, but these complexes will only start production at the end of 2025, and demand for electric cars has fallen dramatically in Europe, as have sales of new cars with traditional systems. We wrote about this here:
- https://hungarynow.com/economy/sales-of-new-vehicles-increased-in-hungary-in-q1-2024
- https://hungarynow.com/economy/has-the-pace-of-battery-production-stalled
Hungary’s financial situation has also been examined by international credit rating agencies, and although we have remained in the investment grade, it is generally with a negative outlook. The articles can be read here:
- https://hungarynow.com/economy/fitch-ratings-has-affirmed-hungarys-bbb-rating-with-a-negative-outlook
- https://hungarynow.com/economy/about-standardpoors-hungarys-credit-rating
Economic management has still not found a way to significantly increase economic performance, and at the end of 2024 it came up with a 21-point action plan that is based on increasing the economy not with state funding, but with private capital and cheap bank loans. The relevant article can be found here:
The OECD has made recommendations on reforming the pension system on several points, but according to our analysis, most of the proposals are not feasible given local conditions and actual life expectancy. The analysis can be read here:
In our most important article, we presented the current state of the “Danube Ironworks” built in the 1950s in light of the large-scale industrial investments currently underway, drawing attention to the fact that large investments can become local sources of danger decades later. The article can be found here:
For 2025, economic management paints an optimistic picture, promising significant economic growth, further reduction in inflation, and higher wage increases.
At the same time, the situation of the international economy is still not promising, and due to the forint’s exchange rate against the EUR and USD, no significant change is expected in the performance of the Hungarian economy compared to 2024.