According to the latest report of the Hungarian Central Statistical Office (KSH), in Q3 2017 Hungary’s GDP grew by 3.9 percent year-on-year. Data adjusted for seasonal and calendar effects show an increase of 4.1 percent. With the exception of the agricultural sector, on which bad weather had taken a toll, every economic sector has contributed to higher output.

This signals that the expansion of the Hungarian economy has been broad-based. The sound structure and sustainable nature of growth has also been underpinned by the fact that Hungary’s financial situation has been firm, and dynamic growth could be achieved – unlike under the economic policy prior to 2010 – parallel to state debt reduction. The latest data show that investment was the driver of growth in the observed period and investment growth is laying the groundwork for future GDP increases thanks to capacity expansion projects and steadily rising consumption. Investment growth has been fuelled by the Government’s housing programme, the accelerated disbursement of EU funds and capacity expansion at large enterprises. Consumption has also increased due mainly to the stimulating effect of the six-year wage agreement. On the production side, market services was the largest growth factor – thanks to robust domestic demand, tourism and the real estate market – but productive sectors have also added to growth.

Industrial sector output growth (3.7 percent) has also been fuelled by rising production capacity. The construction sector also saw robust growth: in the first nine months of the year, the number newly built homes was up by 52 percent year-on-year.

In Q3 2017, GDP in the EU grew on average by 2.5 percent year-on-year, according to Eurostat data adjusted for seasonal and calendar effects. Hungary’s respective figure of 4.1 percent is well above the EU average shows that Hungary’s convergence with more highly developed member states has accelerated.

In the last quarter of the year, the Ministry for National Economy is expecting economic growth to gather momentum.

(Ministry for National Economy)