Prices

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Industrial producer prices were 2.3% lower on average in August 2023 compared to one year earlier. Domestic output prices were up by 8.6% and non-domestic output prices decreased by 7.6%. The large difference was primarily due to domestic output prices in the energy industry – producing goods basically for the domestic market, within which representing a large weight – being higher than a year earlier, while non-domestic output prices there being already substantially lower. The development of industrial producer prices was influenced also by the increase in base material prices and the rise in production costs, as well as the annual strengthening of the forint against the euro. Compared to the previous month, domestic output prices were up by 0.3% and non-domestic output prices by 0.9%, so industrial producer prices as a whole rose by 0.7%.

Agricultural producer prices rose by 6.9% in the 1st half of 2023, within which the price of crop products diminished by 3.0% and that of animals and animal products increased by 32%. The 16% increase in input prices was influenced about to the same extent by the price rises for the components of intermediate consumption and for investments. The price level went up by 16% in the case of the former and by 15% for the latter. The value of the agricultural terms of trade was 92.2%.

Consumer prices were 16.4% higher on average in August 2023 than a year earlier. The prices of electricity, gas and other fuels as well as motor fuels rose significantly over the last twelve months. In one month, consumer prices increased by 0.7% on average, within which clothing and footwear cost 1.6% less for consumers.

The performance of the Hungarian economy lagged behind the one year earlier level by 0.9% in the 1st quarter of 2023. The January – March 2023 natural decrease of the population amounted to 14 thousand people, 27% less than one year earlier. The decrease is mostly due to the lower mortality. The hike of consumer prices was 25% in the first four months, compared to the same period of 2022, the 42% increase in food prices contributed the most to the rise in prices.

Service prices rose at an accelerating rate in Hungary from the 3rd quarter of 2021, and services cost an average 13.5% more in the 1st quarter of 2023 compared to a year earlier. The charges rose for all observed services, out of which the increases in the prices of food and beverage service activities (31.0%), real estate activities (15.6%), land transport and transport via pipelines (15.5%) and warehousing and support activities for transportation (11.3%) had the largest effect on the average change in prices.

The processes taken place in 2022 were mainly determined by the uncertain global environment due to the Russia-Ukraine war and the general and considerable price increases worldwide. Despite these challenges, the Hungarian economy's performance expanded by 4.6% year-on-year, above the EU average. Employment reached a new record high and average earnings rose significantly, but the impact of this was gradually eroded by surging inflation. Population decline continued at a lower pace than in the previous year.

The price of pigs for slaughter in Hungary has started to rise again from February 2023, in April (713 HUF/kilogram) it was more than a fifth higher than in the same period of the previous year. The price of chickens for slaughter has been above HUF 500 since December 2022 and was 27% higher in April than a year earlier. The price of cattle for slaughter is currently at the April 2022 price level. The price of milk has been falling steadily for five months, but in April it was still 26% higher and eggs (48 forints per piece) 61% higher than in the same month of 2022.

The increasingly slow rise in agricultural prices in Hungary since October 2022 turned into a fall in April 2023, with prices 7.2% lower than in the same period of the previous year. Prices of crops and horticultural products fall for the second month in a row - down 19% in April compared with the same period last year - driven by a fall in the prices of cereals and oilseeds. However, the price of live animals and animal products continues to rise, up 23% in April compared to April 2022.

Industrial producer prices in the EU, following a one-and-a half year long decrease, stagnation, began to rise in February 2021. The price hike speeded up, almost evenly, to 33% by August 2022, then the pace of the price increase lessened month by month. Industrial producer prices surpassed in April 2023 the previous year’s level by only 1,7%. Within the EU – just like in the previous five months –Hungary showed the highest industrial production price hike (15%).

Despite the adverse economic effects, GDP volume in 2022 was 4.6% higher than a year earlier, while the employment rate expanded to 74.4%. Fewer deaths followed the end of the pandemic, but the birth rate also fell compared to 2021. In addition to the above data, the tables and graphs in the latest edition of the Statistical Pocketbook of Hungary, published every spring, provide a comprehensive insight into the evolution of social and economic trends in Hungary in 2022.