In Q1 2015, Hungary’s GDP was up by 3.5 percent year-on-year, above prior expectations. Along with net exports, the main driver of growth was domestic consumption. The Hungarian economy performed better than the EU average of some 1.4 percent.

Compared to preliminary data that had showed growth of 3.4 percent, in Q1 2015 the Hungarian economy expanded by 3.5 percent, while quarter-on-quarter growth was 0.8 percent.

Almost every sector contributed to the expansion. In the first quarter, foreign trade surplus totalled HUF 531 million compared to the outstandingly high level one year ago.

In the same period, industrial output showed marked growth of 7.7 percent, thanks mainly to production capacity expansion in the car industry, the growth of car industry supplier output and steadily high external car industry demand. Despite the high base, construction sector output soared by 9.2 percent, boosted by SME lending programmes and EU funding. The tourism sector and the volume of retail sales gained 5.5 percent each, year-on-year, in the observed period.

It was for the last time in the first quarter of 2006 that an even larger consumption growth figure was recorded in Hungary. Subdued inflation, the Government’s forex borrower rescue programme, rising wages in real terms and higher employment have all contributed to the favourable 2.7 percent consumption growth figure.

First quarter growth is in line with the prior estimates of the Ministry for National Economy, and thus the full-year growth target of 3.1 percent prognosticated in the Convergence Programme will be met. Since 2013, the Hungarian economy has displayed a sounder and more and more balanced economic structure. In light of data, the positive growth trend will remain steady and sustainable even in the long term.

(Ministry for National Economy)