Hungary Economic Outlook
November 3, 2020The economy seemingly emerged from recession in Q3 after the severe blow dealt by lockdown measures at home and abroad in Q2. Both industrial production and merchandise exports contracted at a notably softer pace in July-August compared to Q2, which, together with higher business sentiment, points to improving private sector activity. Moreover, stronger retail sales and less downbeat consumer sentiment in Q3 hint at recovering household spending. Turning to Q4, available indicators paint a mixed picture of the economy: Although business sentiment rose further in October, consumers turned more pessimistic in the same month, likely due to the sustained rise in new Covid-19 cases. Meanwhile, in late October, the Council of the European Union approved a EUR 504 million loan for Hungary as part of the EU's SURE program to protect jobs and sustain incomes amid the pandemic.
Hungary Economic GrowthNext year, GDP is seen recovering from the pandemic’s fallout as private spending rebounds, external demand returns on the back of a reopening of the global economy and inflows of EU funding provide further support. That said, the unpredictable evolution of the pandemic poses a downside risk to the outlook. FocusEconomics analysts see GDP growing 4.7% in 2021, which is down 0.1 percentage points from last month’s forecast, and 3.8% in 2022.
Hungary Economy Data
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|Bond Yield||2.08||0.0 %||Dec 31|
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Hungary Economic News
November 23, 2020
The GKI economic sentiment index, a composite indicator, dropped to minus 23.7 in November from minus 18.8 in October.
November 17, 2020
At its meeting on 17 November, the Monetary Council of the Hungarian National Bank (MNB) decided to keep the base rate unchanged at the all-time low of 0.60%, and also held all other instruments steady, which was in line with market analysts’ expectations. The MNB’s decision to hold fire represented a balancing act to sustain the economic recovery while keeping inflation in check.
November 13, 2020
According to a preliminary reading released by the Hungarian Central Statistics Office on 13 November, economic activity rebounded strongly in the third quarter, with GDP jumping 11.3% on a seasonally-adjusted quarter-on-quarter basis.
November 12, 2020
According to a second estimate by the Statistical Institute, industrial output decreased 1.0% year-on-year in September (August: +0.0% yoy).
November 10, 2020
Consumer prices increased 0.20% from the previous month in October, contrasting September's 0.40% drop.