Hungarian GDP Growth Slowed in Second Quarter as Imports Rose

Hungary’s economic growth slowed in the second quarter as imports outpaced exports, raising pressure on Prime Minister Viktor Orban to boost expansion after a recession last year and before elections in 2014.

Gross domestic product advanced 0.1 percent from the previous three months after rising 0.6 percent in the first quarter, the Budapest-based statistics office said today. GDP expanded 0.5 percent from a year earlier in the second quarter. The revised data matched preliminary estimates.

Hungary’s growth slowed even as the euro area snapped six quarters of contraction in the three months ended June. Germany, Europe’s largest economy and Hungary’s biggest export market, expanded 0.7 percent from the first quarter.

“The contribution of” net “exports to growth was lower compared with earlier periods” as rising investments and consumption fueled imports, statistician Pal Pozsonyi told reporters today.

The forint gained 0.4 percent to 301.17 per euro by 10:34 a.m. in Budapest. It’s weakened 3.3 percent this year, the ninth-best performance among emerging-market currencies tracked by Bloomberg.

Imports rose 2.7 percent from the first quarter compared with a 2.1 percent increase in exports. Agricultural output dropped 2.6 percent after a 22.4 percent advance. Government investments in roads, railroads and stadium-building contributed to a 1.1 percent increase in fixed-capital formation. Household consumption rose 0.4 percent.

Agriculture production jumped 17.2 percent from a year earlier, while construction output rose 6.9 percent. Industrial production dropped 0.8 percent. Household consumption rose 0.3 percent, the first expansion since 2011.

To contact the reporter on this story: Zoltan Simon in Budapest at zsimon@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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