Hungary PMI in November: slight expansion
Hungary’s seasonally-adjusted Purchasing Managers Index (PMI) stood at 50.3 points in November, climbing from 47.9 points in October, the Hungarian Association of Logistics, Purchasing and Inventory Management (Halpim) said on Monday.
The PMI edged over the 50-point threshold that signals expansion in the manufacturing sector, Halpim said.
Among the PMI sub-indices, the new orders index rose and was over the 50-point mark.
The production volume index increased and indicated expansion.
The employment index fell and continued to show a contraction.
The delivery times index fell.
The gauge of purchased inventories rose but was still under the 50-point mark.
The forint is 2bp shy of 415 per euro as I type down about 1.5% over the past month and down almost 10% over the past year. It helps exports but the inputs into production can become more expensive be that any input materials that are imported or wages that need to be raised for workers due to the decline in their purchasing power. The worst effects of currency decline will be higher inflation and declining capital inflows into Hungary. Currency instability is a negative for foreign investment and it continues to cause capital flight from Hungary. Chinese direct investment is a political deal from China that is being done to gain entry into the European market and does not reflect the realities of investment in Hungary for anyone else. Hungary took on a lot of debt that they now owe to China to set up these factories and it increasingly looks like a bad gamble that does not have the best odds of paying out.