The gross domestic product of Hungary grew by 4.4% year-on-year in the fourth quarter of 2017, according to raw data in a flash estimate released today by the Central Statistical Office (KSH). The main contributors to growth were market-based services and construction. In 2017 as a whole, GDP growth was 4.0%.
The pace of growth accelerated from 3.9% in Q3 2017. Annual growth in the full year 2016 was 2.2%.
In the fourth quarter of last year, GDP grew by 4.8% according to seasonally and calendar-adjusted and reconciled data, compared to the corresponding quarter of the previous year.
Compared to the preceding quarter (Q3 2017), the volume of GDP grew by 1.3% – according to seasonally and calendar-adjusted and reconciled data – in the fourth quarter of 2017.
Hungaryʼs government targeted unadjusted GDP growth of 4.1% for 2017 as a whole.
According to an analysis sent to the Budapest Business Journal by the CIB Group, Q4 growth was supported by market-based services to the greatest extent, similarly to Q3. The contribution of construction was also strong, although in this case the low base played a significant role, given the significant fluctuation of EU funds among the years. Overall GDP growth was broad-based, CIB notes.
Based on monthly figures published earlier, CIB assumes a persistently outstanding role of domestic consumption. In addition to local factors, the role of the European boom is also significant. The growth of the strongest driver, i.e. the German economy, was close to 3% in Q4, while the entire euro area probably showed similar year-on-year growth, which has been outstanding in the period since the economic crisis.
In 2018 it is likely that growth will remain significant, but somewhat less dynamic than in 2017, says CIB. Based on consensus calculations, the average expectation of market players suggests full-year 2018 growth of 3.5-3.7%, the analysis adds.
Among analysts interviewed by state news wire MTI, K&H Bank chief analyst Dávid Németh forecast GDP growth could be around 3.8% this year, but is likely to slow in 2019.
Erste Bank head analyst Orsolya Nyeste said GDP growth could be 3.5% or more this year.
A detailed breakdown of gross domestic product figures for the fourth quarter and full year of 2017 will be contained in a second estimate to be published by the KSH on March 6.