Despite both WDA and SWDA figures lagging behind the unadjusted figure by half a percentage point, Hungary’s 4.1% GDP growth figure posted for Q1 today is above market expectations and indicates “strong expansion,” according to a flash report sent to the Budapest Business Journal by CIB Bank Hungary.
Additionally, the measured quarter-on-quarter growth figure of 1.3% in Q1 represents a nearly double-pace growth, as the highest such figure in the past two years, CIB notes.
The industrial sector and market-based services appear to support Hungary’s economic growth in particular.
“Based on recent monthly data, we see the industrial performance as a reflection of growth in several sub-sectors (including electronics and optics), not solely the contribution of the past few years’ expansion of auto industry capacities,” the CIB flash explains.
“The value added from construction might have been modest, though year-on-year figures are relatively high due to the low base. Agriculture stagnated. The service sector was supported further by strengthening domestic demand. Despite the latter, net exports were still probably negative contributors to growth, with moderate dynamics on the import side,” the flash adds.
CIB expects the market consensus on the annual GDP figure to accelerate again this year.
“In view of the Q1 data, the annual growth rate may come in significantly above 3%, but probably below 4%,” CIB Bank forecasts.
The Central Statistical Office (KSH) will publish further details of Q1 GDP in its second estimate scheduled for June 7.