HUNGARY
Analyst
Istvan Racz
Former Director, Central BankDatabanks
Recent Country Insights
No policy change at today's Monetary Council, as expected
HUNGARY · In Brief · 27 May 2025
The base rate remains at 6.5%, and the interest rate corridor has also been left at 5.5-7.5%. The Council expect headline CPI-inflation close to (meaning not a lot above) the target range. They continue to aim at maintaining the stability of financial markets (in our reading this primarily means ...
Good news, bad news: a brief update to last week's monthly report
HUNGARY · In Brief · 26 May 2025
Our latest monthly report was released on May 20. Here follows a list of the most important items, which have shown up since then.1. In the report, we wrote of the decelerating trend of nominal wage growth, which is good news for inflation but bad news for growth. We referred to the fact that by ...
Improving price stability but no good prospects for GDP
HUNGARY · Report · 20 May 2025
Energy prices remain favorable for importers such as Hungary, especially regarding crude oil. We still consider the occasionally repeated US threat of retaliatory tariffs on those who buy Russian energy as unlikely to materialize. However, an alternative plan by the EU to end all purchases of Rus...
Disappointing CPI data for April: cap on retail margins did not work quite as suggested previously
HUNGARY · In Brief · 09 May 2025
The headline rate was 0.2% mom, 4.2% yoy, the latter down from 4.7% yoy in March, core inflation was 0.1% mom, 5% yoy, also down from 5.7% yoy in the previous month: So, it looks like the spike seen in the first two months of this year has been overcome, both headline and core fell neatly, and th...
April CPI out tomorrow: prepare for the headline rate deeply below 4%
HUNGARY · In Brief · 08 May 2025 · 1 response
The headline rate went up to 5.6% yoy in February, from where it came down to 4.7% yoy in March. Against that, a further drop to below 4% in April may look extraordinary. But circumstances are extraordinary, too. For one thing, fuel prices (7.3% of the CPI basket) dropped substantially again in A...
US, EU trade policy measures work against economic growth in Hungary
HUNGARY · In Brief · 07 May 2025
Well, this looks like a series of unfavourable news now. Here is a list of what we mean: 1. A few days ago, Mr. Trump's 25% tariffs on the imports of car components took effect, following a similar measure on the imports of complete cars, implemented one month earlier. Naturally, these moves affe...
Administrative price regulation will most likely be extended and broadened after end-May
HUNGARY · In Brief · 03 May 2025
Economy Minister Nagy has made a considerable number of public appearances on the existing administrative price regulation applied to the retail prices of certain food items recently. The summary of his statements must be as follows, we think: - The limitation of the retail price margins used at ...
Negative GDP growth reported for Q1
HUNGARY · In Brief · 30 Apr 2025
Preliminary, seasonally and day-adjusted GDP data shows -0.2% qoq, -0.4% yoy real growth for Q1, as reported this morning. This came after +0.6% qoq, +0.1% yoy in Q4, and 0.5% growth in full-year 2024. In an unusually brief statement, KSH only said that Q1 growth was supported by services but hel...
Fiscal cost of election campaign spending increases
HUNGARY · In Brief · 29 Apr 2025
The other day, Economy Minister Nagy confirmed that the members of armed services (soldiers, policemen, etc., about 100k people) will be entitled to another one-time bonus payment, equal to 6-month worth of salaries, in February next year, and that the government are going to earmark some HUF450b...