Following a temporary dip, in the month of August 2016 the volume of industrial output grew by 11.1 percent year-on-year, and thus total output growth in the initial eight months of the year was 2.3 percent in Hungary. Since January 2010 and the beginning of 2014 output rose by 29 percent and 13.1 percent, respectively.

August data adjusted for calendar effects showed a year-on-year increase of 3.5 percent.

All but one manufacturing industry sub sectors reported output growth. The volume of output at motor vehicle manufacturers, which sector accounts for some one-third of total output, was up by 16.6 percent since August 2015.

Output was also higher by 17 percent at road vehicle producers, while manufacturers of road vehicle components recorded an increase of 15.7 percent. The output of rubber products was up by 13.3 percent compared to the same period of the previous year. As a whole, motor vehicle and rubber product manufacturers added 5.6 percentage points to the growth in manufacturing sector output.

The manufacturing industry posted growth of 12 percent in August. Output in mining, a relatively minor sector, soared by 22.5 percent, while it was down by 0.8 percent concerning the energy sector.

The pharmaceuticals industry and machinery manufacturing were also among leading divisions.

In the short term, confidence indicators are signalling further growth: they were much more favourable in September than in August. The total volume of new orders at major manufacturing sectors saw the highest year-on-year increase, 15.4 percent, since October 2015. Within that, the volume of domestic and export orders increased by 21.9 percent and 14.3 percent year-on-year, respectively.

Government measures aimed to accelerate the drawing of EU funds continue to boost growth. The Irinyi Plan is another major driver of future growth. The programme focuses on the support of seven priority areas: motor vehicle as well as specialized machinery and vehicle manufacturing, health industry, food industry, green economy, info-communication and defence industry. All these areas are expected to see higher output growth in the medium term.

(Ministry for National Economy)