The Hungarian economy continued to expand robustly in the first quarter. According to preliminary data released by the Central Statistics Office (KSH) on 15 May, economic growth in Q1 came in at 4.4% year-on-year, matching the previous quarter’s result—which had marked the fastest expansion since Q2 2014.
Robust household spending likely drove growth: Retail sales expanded at a strong pace throughout the quarter, underpinned by improving consumer confidence, tight labor market conditions and moderate inflation. Moreover, healthy expansions in industrial production in both January and February suggest fixed investment also steadily increased, benefiting from rising EU funds. That said, industrial production growth in March slowed significantly, although that could be due to the temporary cooling in the industrial sector seen throughout the EU.
On a quarter-on-quarter, seasonally- and calendar-adjusted basis, GDP growth ticked down from 1.3% in Q4 to 1.2% in Q1.
More detailed data will be released on 5 June.
Hungary GDP Forecast
FocusEconomics Consensus Forecast panelists expect the economy to expand 3.2% in 2018, which is up 0.1 percentage points from last month’s projection. For 2019, the panel expects growth of 3.1%.