The GKI economic sentiment index has not increased for the second month

After August, the GKI economic sentiment index decreased also in September, within the statistical margin of error. This is due to some deterioration in consumer expectations, as business expectations stagnated. After a shock-like fall in the outlook for domestic econom-ic participants in April, there was a significant positive correction in May and June and a more modest one in July. Thus, the GKI economic sentiment index eliminated more than half of its April fall. By September, the extent of this elimination decreased to only half of the April fall.

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You can reach the archive of survey summaries here.

The rise in GKI’s economic sentiment index stopped in August

Only half of the April decline in GKI’s economic sentiment index resulting from the panic caused by the pandemic has been eliminated during the past four months. Moreover, according to the empirical survey conducted by GKI (www.gki.hu) with the support of the EU, consumer expecta-tions even deteriorated slightly and business expectations remained unchanged.

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You can reach the archive of survey summaries here.

Housing market is over the fright caused by the epidemic, GKI residential indices show a little upturn – GKI residential market survey results for July 2020

The outlooks of housing companies has been deteriorating since mid-2019. In April, the epidemic exacerbated the negative process. According to the results of the joint survey of GKI and Masterplast conducted in July, there was some rebound, a slight but positive correction both in the national average and in the capital compared to the previous quarter. Housing market players, especially in the capital, are beyond the shock of the epidemic and look a little more optimistic about the future, but their prospects are still not really optimistic in annual terms. At the same time, the market for home renovations picked up during the epidemic, and the turnover of building material stores increased significantly year-on-year. In the next year, the price of flats in Budapest may fall by an average of 5% and in the countryside by 8-13%.

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Only the outlook for consumers and business services improved in July

After a shock-like fall in the outlook for domestic economic agents in April, there was a significant positive correction in May and June. GKI’s economic sentiment index rose only slightly in July, by 2 points, as a combined result of improving expectations of consumers and business services, and stagnant expectations of other sectors. The consumer confi-dence index rose by 6 points this month and the business one by just 1 point compared to June.

You can download the report from here.

You can reach the archive of survey summaries here.

Forecast for 2020

GKI currently expects the Hungarian economy to decline by 5-7 per cent in 2020 (assuming no second wave of the pandemic this year). In March, shortly after the announcement of the coronavirus emergency, GKI forecast two scenarios: one with a 3 per cent and another with a 7 per cent decline in GDP this year. Interestingly, in recent months the Hungarian government and the IMF published forecasts close to GKI’s less pessimistic figure, whereas the EU and the OECD published forecasts with the more pessimistic variant.

You can download the forecast from here.

The archive of earlier forecasts is available here.