Growth components: reviving consumption, rocketing fixed capital formation

T140604_GDP_részletes_2_ENhe second estimate of the CSO confirmed that (unadjusted) GDP grew by 3.5% year-on-year in the first quarter of 2014, and it was up 1.1% against the previous quarter.

On the production side, this relatively buoyant growth was supported by all main components except for agriculture, which slipped by almost 6% year-on-year in Q1, following the steep growth in 2013. The growth was driven most visibly by the dynamic y-o-y rise of value added of industry (6.7%) and construction (25.2%). It should be noted, however, that although services grew less conspiciously (by 1.5%), their contribution to GDP growth was as much as 0.9%, due to the immense share of services within the overall output.

140604_GDP_részletes_1_ENOn the expenditure side, private consumption growth accelerated to 1.6% from 0.7% in Q4 2013, roughly in line with expectations. The growth rate of fixed capital formation exceeded 13% – as a result, its contribution to growth was higher than that of private (and overall) consumption, in spite of its relatively modest share in the final use of GDP. Nex exports contributed to growth positively in Q1, a welcome news. But the export of goods and services grew at a somewhat lower rate than import (7.5% versus 7.6%), and this slight negative gap is likely to widen in the coming quarters. In 2014 as a whole – as well as in 2015 – the contribution of net exports to growth probably will be rather neutral than positive.