Hungary: Economic sentiment hits new all-time high in February
The GKI economic sentiment index climbed for the fourth consecutive month from 8.2 points in January, a previous record, to 9.5 points in February—a new all-time high. February’s figure reflected notable improvements in both the business and consumer confidence indices.
Business sentiment rose from 14.2 points in January to 15.5 in February—the highest reading on record. The increase was driven by more optimistic expectations in the industry and trade sectors. This more than offset slight declines in confidence in the construction and service sectors, which nevertheless remained near historic highs.
Looking at the different subcomponents of the index, willingness to hire additional workers declined in all business sectors except industry. Intentions to increase prices rose marginally in industry and construction but remained unchanged in services and trade. Firms’ assessment on the overall economic outlook worsened somewhat across all sectors, although expectations remained optimistic.
Consumer confidence also improved markedly in February, with the index increasing from minus 8.9 points in January to minus 7.6 points—the highest reading since November 2002. The pick-up was largely driven by households’ more upbeat assessments of their financial situation and capacity to save, as well as their stronger willingness to buy high-value durable consumer goods.