IDEAS home Printed from https://ideas.repec.org/p/imf/imfscr/2023-071.html
   My bibliography  Save this paper

Hungary: Selected Issues

Author

Listed:
  • International Monetary Fund

Abstract

This Selected Issues paper examines how and why Hungary reached historically high inflation. Particular attention is placed on cross-country comparisons to understand where Hungary may stand out, and on domestic drivers that could help explain stronger inflationary pressure in Hungary. Following an overview of inflation developments over the last two years, the paper draws on an augmented Phillips Curve to estimate the impact of common drivers of inflation, examines the role of labor market tightness and policy stances, and analyzes possible changes to the degree of exchange rate pass through in recent years. Based on the findings, the paper then explores risks to the inflation outlook and draws policy recommendations. Though monetary and fiscal policies are now tightening, inflation expectations are de-anchored and core inflation dynamics remain strong, reflecting a tight labor market and the lag-effect of loose policies that have boosted domestic demand. Going forward, a consistently and persistently tight overall policy mix is needed to drive inflation back to the central bank’s target.

Suggested Citation

  • International Monetary Fund, 2023. "Hungary: Selected Issues," IMF Staff Country Reports 2023/071, International Monetary Fund.
    • Handle: RePEc:imf:imfscr:2023/071
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=529093
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:imf:imfscr:2023/071. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Akshay Modi (email available below). General contact details of provider: https://edirc.repec.org/data/imfffus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.