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Analysts attribute improving industrial output to base effect, pickup on export markets

Hungary's industrial output is improving because of the base effect and demand on export markets, but the country's industrial sector will not reach levels seen before the crisis for several years, analysts told MTI on Friday.

Hungary's industrial output fell an unadjusted 7.0% and a workday-adjusted 9.2% in November from the same month a year earlier, the Central Statistical Office (KSH) said in a second reading published in the morning on Friday. The decline slowed from an unadjusted 12.9% and an adjusted 10.8% in October.

Gergely Suppan of Magyar Takarékszövetkezeti Bank said November output levels for the industrial sector were about the same as those in 2005. This year, they could reach levels from 2006 or the beginning of 2007, but it will be at least four years before the sector reaches levels seen before the crisis, he added.

Demand on export markets has picked up a bit in the past months, but domestic demand is not improving, Suppan said. Industrial output in the Czech Republic, Slovakia and Poland has already started to grow in a year-on-year comparison, he added.

Raiffeisen Bank's Zoltan Torok also attributed the slowdown in the drop in output to the base effect and improvements on Hungary's biggest export markets. Growth could return in some areas in 2010, he added. (MTI-Econews)