Hungary is one of Europe’s major economic success stories. Bringing the current inflation episode to an end would only reinforce the country’s position as a role model for the rest of Europe.
Although some countries have recovered, overall economic activity has been disappointing. To make matters worse, a closer look at capital formation—a.k.a., business investments—and consumer spending suggest that a recession is in fact just around the corner.
Some forecasters believe that inflation will persist for an extended period of time. I disagree, and if the signs of an inflation peak are as strong as I believe they are, then Europe could be out of this inflation episode before next summer.
