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MKIK company sentiment index falls in October

The Hungarian Chamber of Commerce and Industry (MKIK) Economy and Enterprise Research Institute index of company sentiment in Hungary dropped from +16.8 in April to +1.3 in October, MKIK President Lazslo Parragh said on Friday.

Mr Parragh said that even though the October result of the index based on a survey of 2,000 companies operating in Hungary was still positive, its sharp decline from April serves as a stern warning of problems in the country’s economy.

Between April and October sentiment had deteriorated at foreign-owned companies and, to an even more dramatic degree, at small Hungarian companies focused on production for the domestic market and construction companies.

Responses in the survey project that the current high jobless rate will persist, Mr Parragh said.

Mr Parragh told MTI that the government’s Thursday decision to begin talks with the IMF regarding a new type of financial cooperation was unavoidable, adding that Hungary’s business sector had warned that the forint had begun to weaken uncontrollably as a result of speculation.