Hungary: Economic sentiment closes year on a high note
The GKI economic sentiment index, a composite indicator, rose to 8.6 points in December from 7.5 points in November. The increase reflected an improvement in both business and consumer confidence.
The business sentiment component of the index increased to 15.4 points in December from 14.4 points in November on the back of improved optimism in the industry sector. Confidence in the trade, construction and services sectors, on the other hand, declined. Greater confidence in the industrial sector was fueled by improved assessments of production levels and stocks of orders. Meanwhile, sentiment in the services sector lost ground on worse assessments on the general state of business and sales, while confidence in the construction sector dropped due to a deterioration in the assessments of orders. Moreover, confidence in the trade sector fell for the third consecutive month weighed down by more downbeat evaluation on sales and stacks of orders.
Looking at the different subcomponents of the business sentiment survey, intentions to hire strengthened in all sectors, expect industry, while intentions to raise prices declined. On the other hand, views on Hungary’s economic outlook improved in all industries, as they did among consumers.
Meanwhile, consumer confidence rose in December, with the index increasing to minus 10.6 points from minus 12.1 points in November. The increase reflected households’ more favorable views on their financial position, saving capacities and their possibility of purchasing high-value durables.