Hungary: Current account surplus recorded in Q2
Overview:
For some time now, external account trends in Hungary have been positive. Historically a country that has recorded recurrent, large trade and current account deficits Hungary has recently been enjoying regular monthly trade surpluses. Indeed, a large cumulative trade surplus has even pushed the current account into surplus in Q2. Hungary’s export performance has been impressive in the last few years and even now, with y-o-y export growth negative, imports are falling at a faster pace. Unlike some peers in the region, these improved trade trends seem likely to be permanent not just a temporary feature of the current credit crunch. The improved external account situation and large IMF/EU disbursements have seen FX reserves rise sharply. This extra buffer may well prove necessary as political noise rises.