ECB projects slower inflation and modest growth as Hungary’s inflation drops to 1.3% in August

The European Central Bank released its latest baseline scenario, showing a gradual decline in overall inflation and a modest rise in euro‑area output, with core inflation also expected to ease. The outlook has been nudged upward, reflecting stronger economic capacity, but the bank noted considerable uncertainty. In Hungary, inflation fell sharply to 1.3% in August after starting the year at 2.1%, and is projected to be about 1.8% by year‑end, a decline attributed to a strong forint and administrative price caps. Analysts note that higher service‑sector price dynamics could pose a risk to sustained price stability, while a brighter export outlook and continued household consumption are supporting the economy.