Published on: 5 December 2017

GDP rises by 3.9%

The volume of gross domestic product was 3.9% higher in Hungary in the 3rd quarter of 2017 than in the corresponding period of the previous year. The primary contributor to the growth was market-based services. According to seasonally and calendar adjusted and reconciled data the performance of the economy was up by 4.1% compared to the corresponding quarter of the previous year and by 0.9% compared to the previous quarter. The volume of GDP grew by 3.8% in the 1st–3rd quarters of 2017 compared to a year earlier.

In the 3rd quarter of 2017 compared to the corresponding period of the previous year:

The volume of GDP was up by 3.9%. Compared with the 3rd-quarter figure issued in the flash estimate, the second estimate shows a 0.3 percentage point higher volume increase, which was mainly due to the performance of market services being more favourable than expected.

Production approach:

The value added of industry grew by 3.7%, within which that of manufacturing by 4.9% compared to the same period of the previous year. Within manufacturing, all of the branches with relatively large weight increased with the exception of the manufacture of transport equipment.

The performance of construction rose by 28%. The highest increase within the branch was recorded for civil engineering.

The value added of agriculture decreased by 11% compared to the high base a year earlier.

The gross value added of services was up by 3.8% in total. The total value added of professional, scientific, technical and administrative activities grew by 8.1%, within which it was the increase of administrative and support service activities that was substantial. The value added of information and communication became 8.2% higher. The value added of wholesale and retail trade as well as accommodation and food service activities rose by 6.8%. The performance of transportation and storage grew by 4.7%. The performance of financial and insurance activities became 0.6% higher, namely, fees and commissions were up due to the growth of the stocks of loans and deposits. The total performance of public administration, education and health was down by 1.5%.

Services contributed by 2.0 percentage points, industry by 0.8 percentage point and construction by 1.0 percentage point to the 3.9% growth of gross domestic product in the 3rd quarter of 2017. Within services it was the contribution of wholesale and retail trade and accommodation and food service activities and the total contribution of professional, scientific and technical activities as well as administrative and support service activities (0.7 percentage point and 0.6 percentage point respectively) that were the most significant ones. Agriculture lowered the GDP growth rate by 0.6 percentage point, while public administration, education and health by 0.2 percentage point.

Table 1: Volume indices of production of gross domestic product (GDP)

(corresponding period of previous year=100.0%)

NACE Industries 2016 2017
quarter
III IV I II III
AAgriculture, forestry and fishing110.9111.294.687.288.7
B–EManufacturing, mining and quarrying and other industry101.199.4106.7102.9103.7
COf which: manufacturing100.099.0107.9103.7104.9
FConstruction95.694.3124.7128.6128.3
G–TServices, total, of which:103.0103.4103.0102.9103.8
G+IWholesale and retail trade and accommodation and food service activities100.9100.2105.3105.9106.8
HTransportation and storage105.9106.0102.3102.7104.7
JInformation and communication104.0105.7103.2106.5108.2
KFinancial and insurance activities100.9100.3100.5101.4100.6
LReal estate activities103.1103.4101.5101.6103.5
M–NProfessional, scientific, technical and administrative activities107.4107.5106.5106.7108.1
O–QPublic administration, education and health and social work activities101.2102.9100.998.898.5
R–TArts, entertainment and other services102.6102.5103.8104.2106.2
GDP, total (at purchasers' prices)102.5101.9104.3103.3103.9R

R: Revised data.

Expenditure approach:

The actual final consumption of households was up by 4.8% 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, grew by 4.7%, within which volume increases were measured in almost all the groups of expenditure. Out of the groups of expenditure, the volume rose at rates exceeding the average in the case of furnishings and households equipment, food, restaurants and hotels as well as other services. The (domestic) consumption expenditure of households realised on the territory of Hungary increased by 4.3%.

The volume of social transfers in kind from the government grew by 3.4% and that of the actual final consumption of the government by 2.5%. The volume of social transfers in kind from non-profit institutions serving households (NPISHs) became 15% higher.

As a result of the above trends, actual final consumption rose by 4.4%.

Gross fixed capital formation was substantially, 20% higher than the low base in the same period of the previous year. The volume of investments in construction and in machinery and equipment both went up significantly. The growth of investment activity was marked in the majority of industries and in all of the industries having relatively large weight.

Gross capital formation increased by 19% compared to one year earlier.

Domestic use as a whole rose by 8.0% in the 3rd quarter.

Table 2: Volume indices of final use of gross domestic product (GDP)

(corresponding period of previous year=100.0%)

Items of use 2016 2017
quarter
III IV I II III
Household final consumption expenditure103.8104.3103.4104.8104.7
Social transfers in kind from government99.899.498.397.6103.4
Social transfers in kind from NPISHs110.3108.7104.7101.5114.9
Actual final consumption of households103.3103.6102.6103.5104.8
Actual final consumption of government97.795.791.897.3102.5
Actual final consumption, total102.5102.5101.0102.6104.4
Gross fixed capital formation95.385.0121.6126.1120.3
Changes in inventoriesa)xxxxx
Acquisitions less disposals of valuablesa)xxxxx
Gross capital formation, total99.0100.7129.0112.4119.0
Domestic use, total101.6102.0105.9104.6108.0
Exports, of which:103.599.8109.1106.0104.5
Exports of goods102.498.6109.4108.2105.3
Exports of services107.1104.5107.997.9102.0
Imports, of which:102.699.8111.6107.8109.3
Imports of goods102.7101.6112.6109.0109.9
Imports of services101.991.7106.4101.9106.4
External trade balance of goods and servicesa)xxxxx
Gross domestic product (GDP), total102.5101.9104.3103.3103.9R

a) For these items the volume index is not applicable.
R: Revised data.

In the external trade of the national economy a surplus of 686 billion forints was generated at current prices. Exports were up by 4.5% and imports by 9.3%. In trade in goods, exports grew by 5.3% and imports by 9.9%. Within the external trade of the national economy, the exports of services (including tourism) went up by 2.0% and their imports by 6.4% compared to a year earlier.

Actual final consumption contributed by 3.0 percentage points and gross capital formation by 4.1 percentage points to the 3.9% growth of gross domestic product in the 3rd quarter of 2017. The balance of external trade as a whole slowed down the growth of economic performance by 3.2 percentage points.

In the 3rd quarter of 2017 compared to the previous quarter:

According to seasonally and calendar adjusted and reconciled data the performance of the economy increased by 0.9%. (Comparison to the previous quarter is always based on seasonally and calendar adjusted and reconciled data.)

From the production approach, gross value added grew by 6.7% in construction, by 1.4% in services and by 0.1% in agriculture and lessened by 0.9% in industry.

From the expenditure approach, the actual final consumption of the government was up by 1.1%, household final consumption expenditure by 1.0% and social transfers in kind from the government increased by 0.6% out of the components of actual final consumption. Gross fixed capital formation became 4.3% higher. In external trade, exports were down by 1.1%, while imports went up by 1.2%.