Unadjusted growth was the highest measured since Q4 2005, noted state news agency MTI.
According to seasonally and calendar-adjusted and reconciled data, the performance of the economy was up by 4.6% compared to the corresponding quarter of the previous year (revised from 4.4% in the flash estimate), and by 1.0% compared to the preceding quarter.
In the first half of 2018, economic performance – based on unadjusted data – was 4.6% higher than a year earlier.
On the production side, the value added by agriculture was 3.2% higher than one year earlier. The performance of industry increased by 3.6%, within which manufacturing rose by 4.0% compared to the same period of the previous year. Value added by construction rose by 23.7%, within which there was a significant growth in all branches.
The gross value added by services increase by 4.3% in total. The most substantial increase (7.7%) was recorded for the wholesale and retail trade, as well as accommodation and food service activities.
The performance of financial and insurance activities was up by 2.8%, the highest rise in 13 years, largely due to the improvement of financial intermediation services indirectly measured (FISIM); in addition, loans and deposits of non-financial corporations and households both increased.
Services contributed by 2.3 percentage points, industry by 0.8 of a percentage point, and construction by 0.9 of a percentage point to the 4.8% increase in GDP in Q2 2018, noted the KSH.
On the expenditure side, the actual final consumption of households increased by 4.3% compared to the same period of the previous year.
Household final consumption expenditure, representing the largest proportion of the components of the actual final consumption of households, grew by 5.3%, within which volume increases were measured in most of the groups of expenditure. The domestic consumption expenditure of households realised on the territory of Hungary went up by 5.4%.
The volume of social transfers in kind from the government decreased by 1.2%, while that of the actual final consumption of the government grew by 1.9%.
As a result of the above trends, actual final consumption rose by 4.0%, said the KSH.
Gross fixed capital formation (investments) continued to increase, being 15% higher in the second quarter than in the corresponding period of the previous year. The volume of investments in construction and in machinery and equipment both went up considerably. A growth was observed in the volume of investment in the majority of industries.
Domestic utilization as a whole was up by 6.0% in the second quarter.
In the external trade of the national economy, a surplus of HUF 827 billion was generated in Q2 2018, lower at current prices than one year earlier. Exports rose by 6.2% and imports by 7.5%. In the trade in goods, exports grew by 5.9% and imports by 8.4%, while in services (including tourism) exports rose 7.2% and imports 3.0%.
Actual final consumption contributed by 2.8 percentage points and gross capital formation by 2.6 percentage points to the 4.8% growth in GDP in Q2 2018. The balance of external trade as a whole slowed down growth in economic performance by 0.5 of a percentage point.
Speaking to MTI, ING Bank chief analyst Péter Virovácz said growth was more balanced than in Q1 as industry and construction contributed a combined 1.7 percentage points to the headline figure. He projected full-year GDP growth of 4.3%.
K&H Bank chief analyst Dávid Németh said the fresh data show the pace of growth is slowing from previous quarters. He augured full-year growth of 4.2-4.3% and put growth for next year at 3.3%.
TakarékBank analyst Gergely Suppan was more optimistic, saying growth could continue at the same pace for the rest of the year, bringing annual growth to 4.6%. Next year, because of base effects, growth could slow to 4.1%, he added.
A flash estimate of GDP data for the third quarter of 2018 will be published by the KSH on November 14, with a second, more detailed estimate to follow on December 5.
Producing journalism that is worthy of the name is a costly business. For over 30 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.
