Hungary Inflation March 2022


Hungary: Inflation at over 14-year high in March

April 8, 2022

Consumer prices rose 0.98% in March over the previous month, following the 1.09% surge recorded in February. The sharpest price increases were recorded for food and consumer durables.

Inflation increased to 8.5% from February’s 8.3%, marking the highest inflation rate since June 2007. Meanwhile, the trend pointed up, with annual average inflation coming in at 6.4% in March (February: 6.0%), the highest reading since October 2008. As a further sign of widespread inflationary pressures, core inflation jumped to 9.1% in March from the previous month's 8.1%, marking the highest print since July 2001.

Commenting on the release, Peter Virovacz, senior economist at ING, stated:

“Forecasting inflation for the coming months remains highly challenging due to the war and sanctions, and the uncertainty regarding the anti-inflationary measures introduced by the government. But today's lower-than-expected print increases the chance that Hungary might be able to avoid double-digit inflation this year. Particularly if we take into consideration Prime Minister Viktor Orbán's pledge that he is trying to find a way to maintain the anti-inflationary measures which are ending in May (fuel and basic food price caps).

Against this backdrop, it is difficult to estimate when and where inflation will peak, but even with an extension of the price caps, we see inflation peaking in June or July at close to but below 10%. Regarding the 2022 inflation outlook, with risks still skewed to the upside, we maintain our call that average inflation could be around 9%.”

FocusEconomics panelists see inflation averaging 6.6% in 2022, which is up 1.2 percentage points from last month’s projection. For 2023, the panel sees inflation averaging 3.9%.

Author: Massimo Bassetti, Senior Economist

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