The latest round of data coming out of Hungary, whilst it is still along way from being alarming, is certainly preoccupying. The construction data is a good case in point. Little encouragement at all can be drawn from the numbers we are seeing here:
The latest construction industry statistics in Hungary show a slight recovery after disastrous figures in April (-6.4%), with production up 3.5% month-on-month in May. Even so, the spring of 2007 was rather unsatisfactory on the whole, and future prospects are even more disappointing.
At least, the slightly improved May figures brought the 12-month index back into positive growth, with the workday-adjusted figure currently standing at 5.2%.
Building construction was the only sector within the industry with a positive growth figure in the first 5 months of the year, while all other construction activities stagnated. Unless the coming months bring an upsurge, the years of 2006 and 2007 will go down in history as one of the weakest two-year periods in the industry.
As mentioned above, the future outlook is not particularly promising. At the end of May, builders reported a 32.9% decline in the volume of orders compared with May 2006. Within these, orders for building construction fell 8.9%, whereas demand for other structures almost halved (-45%). The only indicator that could be interpreted as light at the end of the tunnel is that the volume of new contracts signed by construction companies in May was 15.9% higher than a year earlier. Unfortunately, this is simply due to the unusually low figure in May 2006 which serves as the basis for comparison.
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