The Hungarian Communist party selected progressive economist Miklos Nemeth as prime minister in a move apparently designed to ensure the continuity of the reform-minded administration of Karoly Grosz.

Nemeth, 40, a Politburo member, emerged Wednesday the victor over Rezso Nyers, 65, a fellow Politburo member and architect of Hungary's economic reforms in the 1960s, in what insiders say was a fierce power struggle between moderate progressives and others favoring more radical reforms.As a compromise, Nyers was named to the newly created position of state minister for economic issues, which carries the rank of deputy prime minister.

The Hungarian Parliament was expected to confirm the appointment of Nemeth, a former economics professor and a close associate of Grosz, later Thursday.

Grosz, who took the prime minister's job in the fall of 1987, will remain in his post as Hungarian Socialist Worker's Party general secretary.