Hungarian industrial output plunged by an annual 36.8 percent in April, largely on the back of the fallout of the coronavirus epidemic, the Central Statistical Office (KSH) said on Friday, quoting its first estimate.
The fall was heaviest in vehicle production, while production of computers, electronics, optical products and food, beverages and tobacco declined to a lesser extent, the KSH said. The output of pharmaceuticals, however, increased.
Working day-adjusted data showed April output falling by 36.6 percent year on year.
Month on month, output dropped by 30.5 percent in April, based on seasonally and working day-adjusted data.
In the first four months of the year, output was 9.2 percent lower than in the same period last year.
Commenting on the data, the Innovation and Technology Ministry said that the pandemic has resulted in serious losses both on the demand and supply side on the global market.
Coronavirus: Hungary Industrial Output Down 5.6 % in March
As regards Hungary, industrial output reached its lowest point in April and a gradual increase was expected from May.
The ministry expected a recovery to begin in the second half of 2020 with the sector’s output returning to pre-epidemic levels as early as next year, it said.
Hungary, it added, is home to the world’s second most high-tech-intensive industrial sector after Denmark’s, “with flexible and high value-added capacities created across the country. This has helped the country immensely to adjust to the situation created by the pandemic.”
It said the government’s economic protection measures had also helped to preserve and create jobs, providing financial resources to businesses and support for efficiency-boosting investments while banning hostile takeovers.
ING Bank analyst Péter Virovácz said that even the most pessimistic analysts had been surprised by the April data. April saw a record fall in output, he said, adding that a double-digit monthly drop for two consecutive months had been unprecedented.
Takarékbank analyst Gergely Suppan said coronavirus-related restrictions had resulted an unprecedented drop in industrial output in April. He saw a possibility for the sector to pick up sharply in May. He said demand might pick up gradually due to soaring unemployment, wage cuts and cautious consumer spending.
Dávid Németh of K and H Bank noted that with April’s sharp drop, industrial performance was 73 percent of 2015 levels. April is seen in the current outlook as the lowest point, but a second wave of the pandemic, if one emerges, could change that, he said.
Featured photo by Tamás Kovács /MTI