HU: 4Q24 GDP in line with the flash estimate

This morning, the Statistical Office published the details of the 4Q24 GDP figures. In line with the flash estimate, the economy rose by 0.5% q/q and 0.4% y/y. In FY 2024, GDP grew by 0.5% annually.

On the final use side, households final consumption remained the main growth driver, rising by 4.3% y/y in 4Q24. On the other hand, the performance of investments plummeted by 10.8% y/y. Additionally, external activity remained rather subdued. Exports continued to decline by 2% y/y, with imports dropping by 1.3% y/y. The contribution of net exports to GDP was negative, at -0.5 percentage points.

On the production side, in line with the previous comment of the Statistical Office, only the performance of services contributed positively, rising by 2.1% y/y. Agriculture, industry, and services were drags on growth, dropping by 13.5% y/y, 1.6% y/y, and 3.1% y/y, respectively, in the last quarter of last year.

The economy managed to emerge from a technical recession at the end of last year, and a moderate rebound is set to continue this year. However, recent available economic indicators can be seen as rather mixed; the economy might have remained relatively weak in January but probably started to gain some momentum in February, as some confidence indicators improved. Nevertheless, this years growth outlook is clouded by general global uncertainties caused by the planned US tariffs and geopolitical tensions that could further delay the improvement of industrial exports. However, household consumption, a small pick-up in investment, and an improvement in agricultural performance are set to support a continued slow recovery this year. We see annual GDP growth at 2% in 2025, but risks are tilted to the downside, given permanent uncertainties stemming from the still weak state of the external environment.