No revision of GDP data, Hungary in technical recession

In the 3rd quarter of 2024 the volume of GDP was 0.8% lower according to raw data and 0.7% lower according to seasonally and calendar adjusted and reconciled data than in the same period of the previous year. The volume indices published in the second estimate were unchanged compared to the flash estimate.

Industry reduced its performance by 4.4%, within which manufacturing by 6.2% compared to the same period of the previous year. Among manufacturing branches, the largest contributors to the decrease were the manufacture of motor vehicles, trailers and semi-trailers and the manufacture of electrical equipment, while the manufacture of rubber and plastic products and the manufacture of food products, beverages and tobacco products slowed the fall in industry the most. The value added of construction was 4.0% and that of agriculture (as a consequence of the drought) 14.9% lower than in the corresponding period of the previous year.

The gross value added of services increased by 1.9% in total. The highest increase (5.9%) occurred in arts, recreation and other service activities. The value added of education was up by 3.8%, that of transportation and storage by 2.8% and the value added of information and communication by 2.6%. The performance of both accommodation and food service activities and financial and insurance activities increased by 2.4%. The value added of human health and social work activities grew by 2.3% and that of real estate activities by 1.2%. The performance of professional, scientific, technical and administrative activities became 0.9%, that of wholesale and retail trade 0.8% and the performance of public administration 0.4% larger.

The 0.8% decrease in gross domestic product in the 3rd quarter of 2024 was reduced by services (by 0.8 percentage point) and the balance of taxes and subsidies on products (by 0.3 percentage point). Industry lowered the performance of the economy by 1.1, agriculture by 0.6 and construction by 0.2 percentage point. Within services, all sections contributed to a similar extent to offsetting the decrease in GDP.

The actual final consumption of households was up by 4.2% compared to the same period of the previous year. Household final consumption expenditure, representing the largest proportion of the components of the actual final consumption of households, rose by 4.5%. The (domestic) consumption expenditure of households realised on the territory of Hungary became 4.1% higher. The volume of domestic consumption expenditure increased in all durability groups: by 1.6% in the case of durable goods, by 4.6% for semi-durable goods, by 4.8% in the case of non-durable goods and by 4.0% for services.

The volume of social transfers in kind from the government went up by 3.3%, while that of the actual final consumption of the government diminished by 1.4%. The volume of social transfers in kind from non-profit institutions serving households (NPISHs) grew by 1.2%.

As a result of the above trends, actual final consumption increased by 3.2%.

Gross fixed capital formation fell by 14.0% in the 3rd quarter compared to the corresponding period of the previous year. Both the volume of investments in construction and that of investments in machinery and equipment went down.

Gross capital formation decreased by 4.9% compared to the same period of the previous year.

As a result of the trends of consumption and of capital formation, domestic use as a whole grew by 0.3% in the 3rd quarter.

In the external trade of the economy, a surplus of 1,027 billion forints was generated at current prices. The volume of exports went down at a higher rate (1.9%) than that of imports (0.9%). In trade in goods, accounting for almost 80% of external trade, exports became 3.4% and imports 1.5% lower. Within the external trade of the economy, the exports of services (including tourism) increased by 2.1% and their imports by 0.9% compared to the same period of the previous year.

Gross capital formation contributed by 2.1 and the balance of external trade as a whole by 0.9 percentage point to the 0.8% decrease in gross domestic product in the 3rd quarter of 2024. Actual final consumption slowed the decrease in the economic performance by 2.1 percentage points.

In the 3rd quarter 2024 compared to previous quarter, according to seasonally and calendar adjusted and reconciled data, the performance of the economy lessened by 0.7%.

From the production approach, the performance of industry went up by 0.3% and that of services by 0.1%. The performance of construction decreased by 4.2% and that of agriculture by 4.5%.

From the expenditure approach, the volume of household final consumption expenditure became 0.8%, that of social transfers in kind from the government 1.1% and that of the actual final consumption of the government 0.5% higher out of the components of actual final consumption. Gross fixed capital formation fell by 3.2%. In external trade, the volumes of imports and exports as a whole increased (by 1.9% and 0.3%, respectively).