With the latest increase, the sector’s upward trend has been in place for the 25th consecutive month. September’s data are in line with preliminary estimates. Growth was driven mainly by the performance of the Hungarian motor vehicle manufacturing sector, but the food industry and rubber product manufacturers have also been increasingly adding to the expansion. The construction sector posted output growth of above 8 percent, spurred by the revival of the building of homes and real estate investment.

According to both unadjusted and workday-adjusted data, industrial output was up by 7.8 percent year-on-year, the third largest increase since the beginning of the year. Thus, output in the period January-September 2015 was higher by 6.7 percent compared to the same period of the previous year. Month-on-month, output rose by 2.9 percent.

Among significant sub sectors, output at motor vehicle manufacturers, which produce some one-third of total manufacturing industry output, increased by 19.5 percent year-on-year. As a whole, motor vehicle manufacturing and related rubber products manufacturing contributed 6.5 percentage points to total industrial output growth, thanks mainly to recently completed capacity expansion projects and persistently robust external demand for cars.

The volume of orders foretells similar growth also in coming months. In addition, a part of EU funding, which has become available for SMEs as of July 2015, is permitted to be spent on increasing production capacities and that is also expected to have a positive impact on industrial output.

Construction sector output in the month of September was up by 8.1 percent year-on-year and 8.3 percent month-on-month. These data confute fears that following the conclusion of the 2007-2013 programming period the construction sector was set to suffer. However, new EU funds had become available as early as the beginning of this summer which helped boost the sector’s expansion.

Improving investment activity and rising real estate prices also signal a recovery on Hungary’s property market.

(Ministry for National Economy)