Surprise at surprise

“Hungary delivers economic surprise on the positive side” is becoming a unsurprising headline. The Central Statistical Office (KSH) has revealed today that Hungary’s economy grew by 3.5 percents  in January-March on a year-to-year basis:


Hungary’s GDP

So everybody is very surprised yet again…

The analysts’ expectations two days ago

…  just like everybody was surprised at the -0.1% inflation rate announced a few days ago (0.3% was “the consensus of the market”).


To put this in context, here are the latest data for the CEE countries:


GDP growth in some Central and Eastern European EU-member countries



Besides Hungary’s T-bond yields also plummeted  today:   For example, the average 10-year bond yield dropped  by 56 bps to 4.79%, with a big (4.4) bid-to-cover ration,  from 5.35%  two weeks ago. That’s a new historic low in Hungary!   Practically this means the financial market price Hungary’s bonds in the “investment grade” category  but the credit rating agencies don’t bother: they keep rating Hungary in the “junk” category.


Update: today’s data is that the construction industry output grew by 34.2% on a yearly basis!

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