HUNGARY
Analyst
Istvan Racz
Former Director, Central BankDatabanks
Recent Country Insights
Truly impressive: massive budget surplus reported for July
HUNGARY · In Brief · 10 Aug 2026
Well, this is quite brutal: the Finance Ministry reported a preliminary HUF523bn cash surplus for the central budget for July, bringing the cumulative seven-month deficit down to HUF2858bn or an annualised 5.4% of GDP: Indeed, the central budget had surpluses in each of the three months since Tis...
Lowest inflation for the last ten years, and its policy consequences
HUNGARY · In Brief · 08 Aug 2026
The headline rate of CPI-inflation fell to 1.2% yoy in July, from 1.7% yoy in June, the lowest figure seen since November 2016. This was a great surprise, analysts expected 1.5% yoy. Core inflation decreased by less, to 1.9% yoy from the previous month's 2% yoy, but non-fuel inflation was also do...
June industry, retail sales and trade data not quite as bad as it looks at first glance
HUNGARY · In Brief · 06 Aug 2026
This morning's KSH report of the June industrial output and retail sales data has been assessed as unfavourable by some local analysts. This judgement is based on the fact that industry shrank 1.4% mom and retail turnover fell 0.4% mom, both volume terms and sda basis. But indeed, these figures a...
Paks nuclear power plant is almost fully turned off, but economic impact is likely to be limited
HUNGARY · In Brief · 04 Aug 2026
As we reported a few days ago, Central Europe, and indeed the western part of the continent as well, is suffering from a severe drought, combined with unusually high peak daily air temperatures. Over the last few days, water levels in the Danube river have fallen to about half a meter lower than ...
Q2 GDP falls mildly short of analyst forecasts but it should not create pressure on government and MNB policy
HUNGARY · In Brief · 30 Jul 2026
Preliminary data for GDP growth in Q2 has been reported at 0.4% qoq, 1.6% yoy, following 0.8% qoq, 1.7% yoy in Q1. So, GDP grew by 1.7% yoy in H1 this year.This actual falls short of the average analyst expectation of 0.7% qoq, but the shortfall is not particularly big. The key thing is that the ...
Protected fuel prices are not coming back, PM Magyar said
HUNGARY · In Brief · 26 Jul 2026
Now that the Straits (now in plural, including Hormuz and Bab-el-Mandeb) are closed or semi-closed once again, and Brent is back up close to $100 per barrel, the potential return of protected fuel prices, i.e. the retail price caps on the two basic types of gasoline and diesel for all cars and tr...
The dominoes are falling: the Prosecutor General resigned yesterday
HUNGARY · In Brief · 23 Jul 2026 · 1 response
Gábor Bálint Nagy, Hungary's Prosecutor General resigned yesterday and will be reportedly out of office by August 25. Mr. Nagy is a key name of PM Magyar's list of the 'removables', or as he more often calls them, the 'Fidesz-puppets', those constitutionally independent, in principle politically ...
The MNB base rate fell further, to 5.75% today, just as promised
HUNGARY · In Brief · 21 Jul 2026
At today's regular monthly rate-setting meeting, the Monetary Council reduced the base rate further by 25 bps, to 5.75%. This was no surprise at all; the Governor actually promised this cut a month ago, saying this step would be done, and another one of similar size was coming in August as well, ...
The constitutional amendment went through without legal problems
HUNGARY · In Brief · 19 Jul 2026
Somewhat unexpectedly, President Sulyok signed the Constitution's 17th amendment last night, without turning to the Constitutional Court on the matter, to delay the amendment's taking effect. As a consequence: - His office term will end at midnight, today. Parliament's president, Ágnes Forsthoffe...