The coming months will be painful for most Hungarians

September was the first month when the real average wages fell in Hungary. That is because of the skyrocketing inflation, which salaries cannot follow, so the money the employees work for is worth less every single day. Furthermore, the companies need to deal with a worsening business environment, so they cannot raise wages. In the next few months, inflation will be higher resulting in a significant fall in income purchasing power. 

Portfolio.hu writes that in early 2022, the inflation was only 7-8 percent while salaries grew by 15-16 percent. Therefore, the purchasing power of the employees increased. That helped consumption growth and favourably contributed to Hungary’s GDP growth.

However, that balance shifted by autumn and inflation preceded salary increases. In August, the average inflation rate reached a salary increase. Portfolio.hu believes that by the end of the summer, most employees could not buy more from their increasing salaries because the rising inflation devoured the purchasing power of their money.

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