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FINMIN: STRICT FISCAL POLICY NEEDED FURTHER TO PUSH AVG INFLATION BELOW 5%

 

The government’s strict fiscal policy should be continued to push average annual inflation below 5%, the finance minister told a conference on Saturday. In his speech at the iCon economic policy conference in Sopron, in north-west Hungary, Mihály Varga said that inflation fell to 5.5% in December from 25.7% in January 2023. In monetary policy, “the time has come for yields and the base rate to decline.” The government also aims to bring deficit down from 6% to 3%, possibly over 2 years to avoid adverse consequences on growth and unemployment, he said. This year, deficit is expected to be in the 4-4.5% range, he added. Meanwhile, EU funds worth some 520 billion forints (EUR 134.5m) have been disbursed to Hungary since December, his ministry cited Varga as saying. The government is expecting another 2,500 billion forints in 2024, he added.