Industry and retail sales figures for June: no trend change seen, business as usual

HUNGARY - In Brief 06 Aug 2025 by Istvan Racz

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Preliminary industrial output and retail sales data (volume growth on sda basis) for June has been reported this morning. A quick look at the fixed-base chart below (volumes, Dec 2010=100, source: KSH) serves with the easy conclusion that there has not been any change in the long-standing trends, meaning a negative one for industry and a positive one for retail sales: More specifically, industry fell by 1.2% mom, 4.9% yoy, whereas retail sales grew by 0.5% mom, 2.9% yoy in June. More interesting, perhaps, is that in Q2, industrial output shrank by 0.5% qoq, 3.2% yoy. The little consolation for all these negative numbers is fact that in Q2, output actually fell by less in yoy terms than in Q1, which was by 5.3% then. On the contrary, retail sales growth reached 0.9% qoq, 3% yoy, the latter accelerating a bit from the 2.6% recorded in Q1. All this means that both industry and consumer demand, the latter implicitly meaning services must have supported the marginal strengthening of yoy GDP growth, back to the positive territory, in Q2. As one can also see from the foregoing chart, construction must have had a similar supporting impact, whereas agriculture obviously held GDP back significantly in the same period. A somewhat worrying fact, in addition to all other legitimate worries, is that domestic industry seems to have been moving against the European trend of the same sector in recent months (fixed-base chart, Dec 2015=100, source: KSH): The reasons for the fact that Hungarian industry did worse than Europe Area industry is not fully clear yet. A partial explanation may be that the two Korean EV battery producing companies which are present in Hungary are still losing g...