Macro Newsletter
November/December 2025
Domestic News
Inflation Steady Amid Key Rate Stability
• The National Bank of Hungary maintained its key interest rate at 6.50% for the 14th consecutive meeting on November 18, in line with market expectations Headline inflation held steady at 4.3% for the fourth month in a row in October, remaining above the central bank’s 2–4% target range. Governmentimposed price caps and delayed service sector price adjustments could trigger a post-election rebound in inflation, posing risks for 2026.
• Inflation increased for services (6.7%), tobacco products (7.5%), and electricity, gas, and other fuels (10.7%), while easing for food, clothing, and consumer durables. Core inflation rose to 4.2%, marking its highest level in four months.
• Average gross earnings grew by 9.5% in September, while net earnings increased by 10.0%, and real earnings were up 5.5% year-onyear The higher growth in net earnings reflected the expanded family tax benefit introduced on 1 July 2025. Median gross earnings rose by 10.4%, with median net earnings up 11.1% compared with the same period last year
Base rate evolution in Hungary, %
Domestic News
Hungary’s Industrial and Retail Activity Rebounds, EUR/HUF Rate Correction Continues
• Industrial production in Hungary rose by 1.3% year-on-year in September 2025, rebounding from a 7.3% decline in the previous month and in line with preliminary estimates. This was the first growth since March, supported by higher output in key manufacturing sub-sectors such as computers, electronics, optical products, and wood, paper, and printing products Production fell, however, in vehicle manufacturing and electrical equipment. On a seasonally adjusted monthly basis, industrial activity increased by 1.3%. For the January–September period, industrial output remained 3.4% lower than the same period a year earlier
• Retail sales grew 3.0% year-on-year in September, up from 2.4% in August, marking the strongest growth in retail activity since June. Sales of food and beverages rose faster, while trade growth for non-food products slowed to 3 5% from 4.9%, driven by weaker sales in books, computer equipment and specialized stores, second-hand goods, and textiles, clothing, and footwear.
• In financial markets, the forint traded around 382 per euro on November 25, supported by the central bank’s stable policy stance. Hungary’s 10-year government bond yield stood at 7.12%, reflecting steady but cautious investor sentiment.
EUR/HUF ex. rate (2020-2025)
Source: MNB
Energy market
European Energy Prices Decline on Hopes for Ukrainian Peace Deal
• European natural gas futures fell to €29.4/MWh on 26 November, their lowest level since May 2024, following reports that Ukraine had agreed to terms of a revised peace plan aimed at ending the conflict with Russia. A potential resolution could reshape global energy flows just as new LNG capacity comes online next year. Europe’s gas market is adjusting as Russian supply now accounts for only around 10% of imports Recent inflows of LNG and Norwegian pipeline gas, combined with forecasts of milder early December temperatures, eased concerns about low inventories and strengthened Europe’s winter supply position.
• Brent crude oil futures traded near $62 5 per barrel on 26 November, close to a five-week low. Markets were pressured by signs that a Ukrainian peace agreement could lift sanctions on Russian crude, potentially increasing supply. Global production continues to outpace consumption, raising concerns of oversupply and further downward pressure on oil prices.
Eurozone
ECB Holds Rates Steady as Eurozone Inflation Eases; Germany’s Industrial Output Rebounds
• The European Central Bank (ECB) kept interest rates unchanged for a third consecutive meeting in October 2025, signaling confidence in a resilient eurozone economy and easing inflation pressures The main refinancing rate remained at 2.15%, while the deposit facility rate stayed at 2.0%. The ECB noted that inflation remains close to its 2% medium-term target, and its assessment of the inflation outlook is broadly unchanged.
• Eurozone inflation held at 2.1% in October, just above the ECB’s 2% target and slightly down from September’s 2.2%. Food, alcohol, and tobacco price growth slowed to 2.5%, while energy costs declined by 0.9%. Inflation for non-energy goods eased, but services inflation rose to 3 4%, its highest since April Core inflation remained steady at 2 4%
Among major economies, Germany, Italy, and France saw declining inflation, while Spain experienced a modest increase to 3.2%.
• Germany’s industrial production rebounded 1.3% month-on-month in September, recovering from August’s 3 7% decline but falling short of forecasts The rebound was driven by a 12 3% surge in automotive output following factory holidays, along with gains in electronics and optical products. Mechanical engineering slipped, while energy production increased and construction declined. Excluding energy and construction, output rose 1.9%, led by capital goods. Despite the monthly improvement, production was still down by 1 6% year-on-year
Forecast- Hungary
Source: Colliers
Colliers Hungary BEM Center, Bem József u. 1/B., Budapest, 1027 Hungary Colliers | Budapest