Industrial production increased 4.8% year-on-year in June, up from May’s 3.4% rise, according to preliminary data published by the Central Statistics Office (KSH). 

Hungary’s industrial production grew on both a monthly and annual basis, despite the impact of the war in Ukraine and rising energy prices.

The unadjusted data revealed a 1.5% rise, a slowdown from 9.4% in May, BNE reports. The Central Statistics Office added that the manufacturing output of transport equipment and also electronics also increased, yet there was higher growth in food and drink production.

During the first six months of the year, output declined 5.1% year-on-year.

Industrial production in Hungary returned to levels seen at the start of the year, indicating manufacturers were able to cope with supply disruptions stemming from the war in Ukraine, according to ING Bank’s Peter Virovacz.

However, ING Bank is not as optimistic about the industrial outlook and the economy overall as there are indications of weakening economic activity. 

Industrial production decelerated in Q2 following strong growth in Q1, and was sluggish compared to the previous quarter. Magyar Banholding analyst Gergely Suppan stated: “The Hungarian economy could benefit significantly in the medium term from investments by BMW and Mercedes and from the build-up of defence industrial capacity, as military spending is expected to increase significantly in the coming years.”

In addition, the country’s industrial production in June rose 71.1% from the low registered in April 2020, a 25.4% increase from the 2015 average, the BNE report goes on to add, and 53.3% over the average figure.