Record breaking second quarter

After the 3.7-percent GDP growth in the first half of the year GKI Economic Research Zrt. changed its annual growth forecast from 2.5-percent to 3 percent. GKI still expects slowing down in the second half of the year. Business and consumer expectations are positive in both the European Union and Hungary if compared with recent years, but they have been worsening from month to month. Despite Hungary’s so-called ‘opening towards the East’ economic policy, in the first five months of 2014 the EU’s share in our export increased, while the value of Hungarian export to Asia decreased. It is good news that domestic industrial sales have finally improved. Retail turnover has been more dynamic than in previous years but in May-June a sudden slowdown occurred. In Q2 2014 the level of investment rose by 20 percent from Q2 2013. In Q1 2014 the employment level bettered by 2.5 percent (by 5.5 percent if public workers are also included). In May-July 2014 the unemployment level was 7.9 percent, down 2.2 percentage points from May-July 2013. In the first half of the year gross average wages were up 5.7 percent (or 3 percent – calculating with public workers too). This year real wages are expected to increase by 3 percent and consumption will probably improve by 2 percent.