Bloomberg News

Hungary April GKI Confidence Index Falls to 5-Month Low

April 21, 2013

Hungary’s economic-sentiment index deteriorated to its weakest level in five months in April, driven by a plunge in business confidence.

The index fell to minus 21.7, the worst since November, from minus 18.5 in March, the GKI research institute in Budapest said in an e-mailed statement. The consumer-confidence gauge declined to minus 38.9 from minus 37.3, while business confidence dropped to minus 15.6, the worst since September, from minus 11.9.

Hungary’s economy is in its second recession in four years after the euro-area crisis cut export demand and domestic consumption declined. The government raised taxes on energy, retail, telecommunication companies and levied the highest bank tax in Europe, curbing lending and investment.

“The biggest deterioration in sentiment was among manufacturing companies, a similar degree of pessimism in the sector was last seen in autumn 2009,” GKI said.

Gross domestic product will fall 0.1 percent this year after shrinking 1.7 percent in 2012, the European Commission said Feb. 22. The government lowered its growth forecast for this year to 0.7 percent from 0.9 percent previously.

GKI’s indexes are calculated as a balance of positive and negative answers to questions about the outlook for the economy.

To contact the reporter on this story: Edith Balazs in Budapest at ebalazs1@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net


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