The state budget reported a record deficit of HUF 875 billion (EUR 2 billion) in March. By the end of March public deficit already reached 73.3 percent of the full-year target and the budget deficit had accumulated to HUF 2,309 billion (EUR 6 billion), compared to HUF 1,144 billion (EUR 3 billion) in the same period last year.
The Ministry of Finance states a huge budget hole due to increased housing subsidies, family income tax rebates and pension increases.
In March, consumer prices increased by 8.5% yoy. It was the highest inflation rate since June 2007. Food was the primary price driver in the past year at 13%. Consumers had to shell out 11.5% more for fuel last month than a year ago – without the price cap that has been in effect since November, a record rise in prices would certainly have occurred here.
Compared to February, prices rose by 1.0%. Core inflation increased 9.1% yoy and 1.0 percentage point mom.
In addition to fuel prices, the Hungarian National Bank (MNB) takes a critical view of the global rise in prices for semiconductors, food and raw materials.