Hungary Industry July 2021


Hungary: Industrial production growth moderates again in July

September 8, 2021

Industrial output grew at a notably softer rate of 10.2% in annual terms in July, following June’s 18.2% jump, according to a preliminary estimate. July’s slowdown partly reflected a less favorable base effect.

On a monthly basis, industrial output declined 0.5% in seasonally-adjusted terms in July (June: -0.3% s.a. mom). Meanwhile, the trend improved, with annual average growth in industrial production coming in at 12.6% in July, from 11.1% in June.

Commenting on the outlook for industry in the near term, Peter Virovacz, Hungary senior economist at ING, said:

“First in June, then in July. Industry’s performance came as a cold shower in an otherwise hot economy. Supply chain disruptions are having an impact on the sector. […] Besides the GDP impact, the more forceful impact comes from the side of pricing. Rising input and labour costs may further strengthen producer price inflation in the months ahead. As producers are still in a better bargaining position amid expanding demand and scarce supply, we see this becoming more of an issue from a consumer price point of view too, further strengthening the already high inflation pressure.”

FocusEconomics Consensus Forecast panelists project industrial output to increase 11.9% in 2021, which is down 0.4 percentage points from last month’s projection. For 2022, the panel projects industrial output to expand 6.1%.

Author: Massimo Bassetti, Senior Economist

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Hungary Industry Chart

Hungary Industry July 2021

Note: Year-on-year changes and annual average variation of industrial production index in %.
Source: Hungarian Central Statistics Office and FocusEconomics calculations.

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