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Hungary lost as many as 130,000 jobs to pandemic - PM's aide

06/25/2020 | 03:32am EDT

Hungary has lost 120,000 to 130,000 jobs due to the coronavirus pandemic, Prime Minister Viktor Orban's chief of staff said on Thursday, adding that the cabinet still expected the economy to contract by 3% this year.

The National Bank of Hungary unexpectedly cut its base rate by 15 basis points to 0.75% on Tuesday, its first such move in four years, responding to greater-than-expected damage to the economy from the pandemic.

The bank, led by Governor Gyorgy Matolcsy, a strong Orban ally, still expects the economy to grow by 0.3% to 2% this year, far above analyst forecasts for a 5.1% recession and the government's own projection.

"The virus has attacked not just health but jobs as well," Orban's chief of staff, Gergely Gulyas, told a news conference, adding the number of job losses was not as drastic as initial expectations.

Gulyas said however that there was no consensus within the cabinet about this year's economic performance, with some expecting a milder recession and others predicting a more severe downturn.

"If there is a second wave of the pandemic, there is no chance to avoid a recession this year," Gulyas said.

Tuesday's surprise rate cut put the Hungarian forint <EURHUF=D3> on a weakening course, with central Europe's worst-performing unit falling another 0.6% from its opening levels to 354 versus the euro by 0719 GMT on Thursday.

Asked about the falls, Gulyas declined comment.

(Reporting by Gergely Szakacs; Editing by Toby Chopra and Nick Macfie)

ę Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
AUSTRALIAN DOLLAR / EURO (AUD/EUR) 0.56% 0.62315 Delayed Quote.-1.78%
CANADIAN DOLLAR / EURO (CAD/EUR) -0.18% 0.672486 Delayed Quote.5.03%
EURO / HUNGARIAN FORINT (EUR/HUF) -0.26% 355.47 Delayed Quote.-1.23%
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