Finance Minister Mihaly Varga – Photo: MTI

Economic recovery in Hungary is moving forward at a pace that is "among the fastest in the European Union", minister says

GDP up 17.9 percent in Q2

Hungary's second-quarter GDP grew by an annual 17.9 percent after a double-digit decline in the base period, a first reading of data released by the Central Statistical Office (KSH) on Tuesday shows. Adjusted for seasonal and calendar year effects, GDP climbed by 17.7 percent.

In a quarter-on-quarter comparison, GDP rose by a seasonally- and calendar year-adjusted 2.7 percent.

KSH noted that unadjusted GDP was 2.2 percent higher than in Q2 2019, before the start of the pandemic.

First-half GDP was up by 7.6 percent year on year.

Finance Minister Mihaly Varga said in a message posted on Facebook that the fresh data show the economic recovery in Hungary is moving forward at a pace that is “among the fastest in the European Union”.

He said the structure of growth is “healthy” and extends to “a broad range of economic sectors”. Pandemic-related government measures to aid the recovery could contribute 8.4 percentage points to economic growth this year, he said.

“Now the goal is to preserve the [growth] advantage the Hungarian economy enjoys compared to the European Union. That’s why we’re continuing an economic policy based on tax cuts, workplace creation, investment incentives and family support,” he added.

Takarekbank chief analyst Gergely Suppan said full-year GDP growth could reach 6.8 percent this year even if growth stagnates in the second half. Takarekbank is modifying its full-year forecast from 7.7 percent to “around 8 percent”, he added.

K+H Bank senior analyst David Nemeth said the lender is raising its projection for full-year growth from 6.7 percent to “over 7 percent” in light of the Q2 data, but noted the downside risk of the global impact of further pandemic waves caused by Covid variants.

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