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Report23 January 2019Updated 4 months ago

Leading HUBE update: Time to adapt to a slowdown

Based on our leading HUBE indicators, we believe the Hungarian economy lost momentum in the last quarter of 2018, the effect of which will carry over into 2019

Executive summary

According to our Hungarian Business Economy (HUBE) indicators, we see Hungarian economic activity slowing down from the remarkable 5% growth rate reached in 3Q18.

Our forecast stems from recent developments in high frequency data showing that a deceleration might have already started in the last quarter of 2018.

  • Industrial production continued its rollercoaster ride in November showing a contraction on a monthly basis.
  • The retail sector posted soft growth in November, showing a general deceleration in consumption.
  • But the construction industry is showing further strength and double-digit growth. 
  • Soft indicators were rather mixed both for businesses and consumers, but recent German developments are definitely troubling given the strong ties between the two economies. 

In summary, our Leading HUBE indicators decreased further, pointing to a slowdown in GDP growth in 2019. The month-on-month Leading HUBE has been in negative territory for four months. A similar pattern was last seen in 2015, when the country’s GDP growth posted a significant deceleration in the following year. The latest year-on-year Leading HUBE indicator also dropped to a level not seen since the summer of 2016.


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Hungary