Hungary

Macro Monitor – August 2024

According to the September 2024 survey of Századvég Konjunktúrakutató, household economic sentiment improved by 1.5 index points, while business economic expectations fell by 0.5 index points from the previous month. Thus, the household index, measured on a scale of -100 to +100, strengthened to -16.9, while the business index weakened to -16.1. In the September survey, the most positive change in household sentiment was regarding larger purchases in the next year. From August to September, the biggest change for business is that they expect their export activities to increase in volume in the future.

While the weight of the Hungarian digital economy in terms of value added (GVA) has stagnated at around 18% of the GVA in the national economy in recent years, its weight in employment has increased by more than a quarter since the previous survey. In total, the digital economy provided direct or indirect livelihoods for around 935,000 employees in 2022, representing 19.9% of the Hungarian workforce in that year. A technology-driven development path could provide a further powerful boost to the Hungarian digital economy, increasing its GVA generation capacity by nearly HUF 1,500 billion by 2030, which would put Hungary among the most technologically advanced countries in the European Union—finds the research conducted in cooperation between Századvég and IVSZ on behalf of the Ministry for National Economy in the summer of 2024.

Századvég Konjunktúrakutató estimates that the Hungarian economy will grow by 1.7% in 2024, 3.8% in 2025 and 3.2% in 2026. However, the conditions for growth are fragile, with both downside and upside risks in the Hungarian economy, so caution is warranted when making forecasts. In the global context, external disinflationary developments are working towards lower domestic inflation, but the geopolitical situation may continue to be a key factor. In terms of internal factors, the predominant factors for the Hungarian economy this year are the cautiousness of the household sector, low investment activity and the subdued performance of domestic exports in light of the weakening German manufacturing sector. However, in the period ahead, exports could pick up again as international demand—especially German demand—strengthens, which, combined with improving investment activity, could lead to dynamic GDP growth in 2025 and 2026.

According to the August 2024 survey of Századvég Konjunktúrakutató, household economic sentiment deteriorated by 3.7 index points, while business economic expectations fell by 0.3 index points from the previous month. Thus, the household index, measured on a scale of -100 to +100, weakened to -18.3, while the business index to -15.6. The August survey showed that household sentiment changed most as regards the negative changes in Hungary’s economic situation over the next year. In August, the largest month-on-month change for companies was related to more moderate price changes for their products in the past.

According to the July 2024 survey of Századvég Konjunktúrakutató, household economic sentiment deteriorated by 2.7 index points, while business economic expectations fell by 3.0 index points from the previous month. Thus, the household index, measured on a scale of -100 to +100, weakened to -14.6, while the business index to -15.3. In the July survey, the main change in households’ perceptions was related to the change in unemployment in Hungary over the past year. In July, the biggest negative change for businesses in one month was related to the future outlook for the Hungarian economy.

According to the June 2024 survey of Századvég Konjunktúrakutató, household economic sentiment improved significantly, by 2.7 index points, while business economic expectations improved by 1.2 index points from the previous month. Thus, the household index, measured on a scale of -100 to +100, strengthened to -11.9, while the business index strengthened to -12.4. In the June survey, households were particularly positive about the economic outlook for the country over the next year. As regards businesses, the biggest positive change from May to June was in their profit outlook for the next year.

Macro Monitor - May 2024

According to the May 2024 survey of Századvég Konjunktúrakutató, household economic sentiment improved by 1.9 index points, while business economic expectations deteriorated by 1.3 index points from the previous month. Thus, the household index, measured on a scale of -100 to +100, strengthened to -14.5, while the business index weakened to -13.5. The May survey shows that households’ perception of their own financial situation has improved significantly. Meanwhile, the largest positive change from April to May was measured in terms of the reduction in the price increases of businesses over the past year.

Századvég has been conducting international public opinion surveys since 2016 to examine the views of European citizens on the issues that most affect the future of the EU. The aim of the 2024 survey of the unique Project Europe survey series was to map public attitudes on the most important public issues affecting our continent. The main topics of research are issues related to the Russia-Ukraine war and the armed conflict between Israel and Hamas. Topics will also include, among others, the sense of prosperity in society, perceptions of the European Union’s activities, energy price developments and energy policy, media, religious affiliation and attitudes to migration. The results of the survey were presented on 7 May 2024 at the Europe in the Shadow of War conference, held in the Várkert Bazár with the participation of several renowned professionals and public figures.

Macro Monitor - April 2024

According to the April 2024 survey of Századvég Konjunktúrakutató, household economic sentiment deteriorated by 1.6 index points, while business economic expectations improved by 0.7 index points from the previous month. Thus, the household index, measured on a scale of -100 to +100, weakened to -16.4, while the business index strengthened to -12.2. A marked positive change in the April survey is that households’ inflation perceptions are steadily converging towards the actual rate, which is now within the central bank’s inflation target range. For businesses, the biggest positive change from March to April was in profits over the past year.

86% of Hungarians are against European or NATO soldiers fighting in Ukraine, according to a March opinion poll by Századvég. Following recent calls by several leading European politicians, echoing the war rhetoric of French President Emmanuel Macron, for European countries to send troops to support Ukraine against Russia, Századvég has examined the Hungarian public’s views on certain issues related to the armed conflict between Russia and Ukraine.

Prime Minister Viktor Orbán will pay a visit to the United States for several days, during which he will meet former US President Donald Trump, now the only Republican presidential candidate, on 8 March. Trump, just like Hungary, is for peace and calls for an early end to the armed conflict between Russia and Ukraine to avoid more people dying in the war. As one of the main political divides between Joe Biden and Donald Trump in the US presidential election in November is expected to be the continuation of the war or the promotion of peace, Századvég has mapped out what Hungarians think about the current and former US president in this regard.

No European country has majority support for sending troops to Ukraine, according to the Századvég Europe Project research. The analysis, based on the survey, explored European public opinion on the issue of military engagement in Ukraine, following several statements by French President Emmanuel Macron suggesting the need for military intervention by European countries in the war in Ukraine.

An overwhelming majority (87%) of Hungarian consumers think that it is fundamentally positive when a product is Hungarian: they prefer Hungarian goods, and this is encouraging news for Hungarian businesses. Detailed data in the October 2023 survey by Századvég Konjunktúrakutató show that Hungarian consumers have a significantly higher preference for domestic products when buying food than when buying other products.

Századvég’s Sovereignty Conference attracted great interest, with its focus on the efforts of Hungarian conservatives to preserve Hungary’s sovereignty and the presentation of the latest results of the Project Europe research. The event also commemorated the 30th anniversary of Századvég. The event featured high-profile politicians, public figures and Századvég colleagues who shared their thoughts and plans with the participants.