Hungary: Double-Dip Avoided

2021. február 17.

ING Think

Defying all expectations, the Hungarian economy was able to grow in the fourth quarter. This gives a significant boost to the 2021 outlook. While expectations hadn't been particularly high for fourth quarter economic activity in 2020, some positive momentum had emerged in recent weeks following speeches by Prime Minister Viktor Orbán, who suggested the economy could contract by 5.1% to 5.2% in 2020 as a whole, meaning borderline growth in the fourth quarter on a quarterly basis. 

As we now know from the first estimate of fourth quarter GDP growth, the Hungarian economy far surpassed this. GDP growth came in at 1.1% QoQ. With that, a double dip has been avoided and Hungary performed much better than the EU (-0.4%) and the eurozone (-0.6%), continuing the catch-up even in a recession year.