According to a preliminary reading, the pace of growth in economic activity decelerated slightly in the first quarter of 2022. GDP expanded 2.1% on a seasonally-adjusted quarter-on-quarter basis in Q1, following Q4’s 2.2% increase. On an annual basis, the pace of expansion sped up to 8.2% in Q1, from 7.1% in Q4.
While a detailed breakdown is not yet available, the press release highlighted that activity in the market services sector and in industry were the main drivers of the quarter-on-quarter expansion.
More detailed GDP data will be released on 1 June.
Peter Virovacz, senior Hungary economist at ING, signaled downside risks to growth ahead:
“The war in Ukraine goes on and it seems this terrible situation will linger. Sanctions on Russian energy imports could remain on the table, which raises the uncertainty regarding the coming quarters. China’s Covid-19 issues are putting further pressure on the already squeezed global value chains, while companies are trying to find new sources to serve still soaring demand.”
FocusEconomics analysts see GDP growing 5.2% in 2022, which is down 0.1 percentage points from last month’s forecast, and 4.3% in 2023.