Hungary: Economic sentiment reaches highest level in over 11 years
December 25, 2013
In December, the GKI-Erste economic sentiment index rose to minus 2.9 points, marking the highest level since October 2002. The result was well above the minus 6.1 points recorded in November. According to the GKI economic research institute, the improvement was the result of an increase in both consumer sentiment and business expectations.
Consumer sentiment inched up from minus 23.3 points in November to minus 22.7 points in December. Consumers were more optimistic regarding their 2014 financial expectations compared to the previous month. FocusEconomics panelists expect total consumption to expand 1.3% in 2014, which is unchanged from last month's projection. For 2015, the panel expects total consumption to increase to a 1.6% expansion.
Business sentiment rebounded from minus 0.1 points in November to plus 4.0 points in December. The improvements in confidence in trade, services and industry were the main drivers behind the significant monthly increase. Panelists expect fixed investment to increase 2.4% in 2014, which is unchanged over last month's estimate. For 2015, the panel sees investment expanding 2.8%.
Author: Dirina Mançellari, Senior Economist