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A Central Statistics Office (KSH) can basically be filtered out of the data, that the financial situation of households improved significantly compared to the last quarter, however this has not yet brought about the consumption revolution.
The main reason for this is that households prefer to save their extra income, i.e. they do not spend it, but create reserves – he said in response to Economx’s inquiry Krisztián Talabér, a Viewpoint Institute Consumer Barometer of his latest survey highlighting its main conclusion.
Is there a problem! Worrying figures were published about the Hungarians
Although the macroeconomic figures would suggest that the population sees the future more cheerfully, we are still a long way from that. We looked at the latest issues of the Századvég Konjunktúrakutató Zrt. and the Nézőpont Institute. Learn more about the Barometer IN THIS ARTICLE!
According to the expert, this is an understandable reaction to the economic events of the past year and a half, because the security needs of the Hungarian people are high due to historical reasons.
Nézöpont asked if households had extra income, they would rather spend it or save it. The political scientist-economist said that four-fifths of the respondents would rather save their extra income than spend it, and from this, according to him, it follows that
the revival of consumption is not primarily a financial issue.
The effect of the war in Ukraine on the economy is obvious to people, and the uncertainty can be resolved with peace, since the feeling of uncertainty was created by the war itself.
Over time, of course, the uncertainty may ease, but it cannot disappear. The European economy, including the Hungarian one, will really enter a period of economic growth again when the Russian-Ukrainian war ends. The complete restoration of consumer confidence also depends on this. The falling interest rate path, the increasing real wage, and adaptation to the existing situation can bring partial results, but this can only improve the situation, it cannot solve it
Krisztián Talabér said.
According to the Consumer Barometer, the average income of households In March 2024, the net amount was 551.5 thousand forints, which is an increase of almost 10 thousand forints compared to December 2023, and 50 thousand forints more compared to September of the previous year. The amount of money that can actually be used for consumption is HUF 548.5 thousand net on average.
Image: Economx.hu
In March 2024, household expenses for basic consumption (food, non-alcoholic beverages, apartment maintenance or transport) reached HUF 260,000 net on average, which is only HUF 5,000 more than the December figure.
An average household can spend HUF 288.5 thousand net on consumption beyond basic consumption, which is 53 percent of the monthly amount of money that can be spent.Delving a little further into the details, we can see that in March 2024 households on average
- HUF 143.5 thousand were spent on food and non-alcoholic drinks,
- an average of HUF 80,000 for home maintenance and household energy,
- while 36.5 thousand HUF for transport.
About half of households (45 percent) spend HUF 100,000 or less per month on food.
43 percent of households spend 50,000 or less per month on housing maintenance and utilities, while 59 percent of households spend 30,000 or less on transportation.
Hungarian households can spend HUF 288.5 thousand on other consumption beyond basic consumption. At the level of the national economy, a net amount of HUF 1,041 billion can be allocated to basic consumption, while a net amount of HUF 1,155 billion can be allocated to consumption beyond basic consumption.Image: Economx.hu
At the same time, it is also striking that 45 percent of households spend less than HUF 100,000 on food, which even with an average of 2.5 people, it means that a maximum of 1,333 is spent on food in these households per day. About one and a half kilograms of bread is enough for half the country.
In this regard, Krisztián Talabér pointed out that households spent slightly (3 percent) more on food in March compared to December, which confirms the fact of slowing inflation. In December, the proportion of households that spent less than HUF 100,000 on food was roughly the same.
During the questionnaire research, those households that spend less than HUF 100,000 on food often answered the 50, 60 and 80 thousand forintsbut it is important to add to this information the number of households in question
explained the political scientist-economist.
Image: Economx.hu
According to the analyst of the Nézőpont Institute, smaller households tend to spend less on food. Since the consumption of food is considered basic consumption, the change in this type of consumption is extremely inflexible, since it is not possible to save on food purchases. In the case of consumption beyond basic consumption, the difference between income quintiles is really significant, explained the analyst.
