After difficulties in 2023 and 2024, Hungarian GDP is again on the rise. The volume of gross domestic product was 0.5% higher in Q4 2024 than in Q3 2024, and 0.4% higher than in Q4 2023. The increase might seem small, but it indicates a turn after a lengthy period of challenges.
2024 data now available
The Hungarian Central Statistical Office (KSH) has recently published its calculations for Q4 2024, and with it, for the entire year of 2024. The 0.4% increase from Q4 2023 to Q4 2024 is based on the raw data; seasonally and calendar adjusted growth is in fact 0.1%. At the same time, the 0.5% growth from Q3 to Q4 2024 is already adjusted seasonally. If we look at data yearly, raw data suggest a total 0.5% growth between 2023 and 2024, while seasonally and calendar adjusted data indicate a 0.6% growth.
Production: Industry vs. services from Q4 2023 to 2024
The growth is due to the superior performance of the service industry, as traditional industries are still producing a loss, by 1.6% in total, while manufacturing was reduced by 3.5%. Within manufacturing, the manufacture of motor vehicles and electrical equipment decreased the most, while the manufacture of coke and refined petroleum slowed the fall in industry the most. Construction shrank by 3.1%, by and agriculture by 13.5%.
At the same time, the gross value added by services increased by 2.1% in total. Growth was greatest in accommodation and food services (6.4%), followed by arts and recreation (4.4%), then by a draw of financial and investment services and professional, scientific, technical and administrative services (2.9%). These are closely followed by wholesale and retail trade (2.8%), human health and social work (2.7%), and information and communication (2.5%). Somewhat behind come transportation and storage (1.4%), education (1.2%), and public administration (1.1%). The last one in the line is real estate activities, but even that produced some growth, even if only a meager one (0.1%).
| Industry total | -1.6% |
| Manufacturing | -3.5% |
| Construction | -3.1% |
| Agriculture | -13.5% |
| Services total | 2.1% |
| Accommodation and food | 6.4% |
| Arts and Recreation | 4.4% |
| Finances and investment | 2.9% |
| Professional, scientific, technical and administrative activities | 2.9% |
| Wholesale and retail trade | 2.8% |
| Human health and social work | 2.7% |
| Information and communication | 2.5% |
| Transportation and storage | 1.4% |
| Education | 1.2% |
| Public administration | 1.1% |
| Real estate activities | 0.1% |
In Q4 2024, the biggest contributors to economic growth were wholesale and retail trade alongside professional, scientific, technical and administrative services. With that, Services grew by 1.3 percentage points, while Construction lost 0.2, and both Industry and Agriculture lost 0.4.
Expenditure in 2024
The actual final consumption of households shows a 4.3% increase from Q4 2023 to Q4 2024, while household final consumption expenditure went up by 5.4%. This included all durability groups: durable goods (12%), semi-durable goods (1.8%), non-durable goods (4.6%) and services (4.6%). At the same time, gross fixed capital formation fell by 10.8%, while gross capital formation decreased by 2.2%. As a result, domestic use grew by 1.2%.
Regarding external trade, the volume of both exports and imports decreased (by 2% and 1.3%). Since goods make up about 80% of external trade, it is worth taking a look at the numbers there: again we see a decrease, but by 3.3% and 2.3% respectively. In line with this, the export and import of services increased by 2.3% and 3.3.%, respectively.
2024 summed up compared to 2023
According to the first estimate, Hungarian GDP in 2024 was HUF 81,148 billion. This means an increase of 0.5%, while calendar adjusted data indicate a .06% growth. The performance of Services contributed most to this, although the reduction of Industry and Construction slowed down in Q4 2024.
As confirmed by analysts, Hungary seems out of the recession for now. However, as long as Industry and Construction are producing negative results, GDP growth will not accelerate significantly. Meaningful increase is expected from large development projects that are close to completion, and will hopefully start production still in 2025 (CATL, BYD, BMW), although adverse external environment and US trade policies may impact exports negatively. Meanwhile, the continued increase of real wages will probably also contribute to household expenditure.
Official government communication predicts a 3.4% GDP increase in 2025, which would require an increase of 1.3-1.4% in each quarter. In better years, Hungary achieved a 4% increase, but due to recessive periods, the average yearly increase has been around 2% since joining the European Union in 2004. To reach that average outcome, a quarterly growth of 0.8% would be required.
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