The Dutch economy slipped into recession in the second quarter of this year after consumer consumption as well as exports failed, according to signal data sent on Wednesday by their Bureau of Statistics.

recessionPhoto: Yurii Panyukov / Alamy / Profimedia

The eurozone’s fifth-largest economy (behind Germany, France, Italy and Spain) shrank 0.3% in the second quarter after shrinking 0.4% in the first three months of the year.

Hungary’s economy shrank 0.3 percent from April to June from the previous three months, the fourth straight quarterly contraction, beating analysts’ expectations in a Bloomberg survey for a 0.2 percent rise that would signal an exit from recession. According to the statistical office on Wednesday, the economy shrank by 2.4% compared to a year earlier. This is the longest period of economic decline since 1995.

Experts cited by Reuters say the recession has dragged on because of high inflation, which has affected people’s purchasing power and stalled consumption.

Hungary’s economy shrank 2.4% year-on-year in the second quarter, based on unadjusted preliminary data, below analysts’ forecasts for a 1.2% contraction. Quarterly GDP fell for the fourth quarter in a row.

According to data from the Central Bureau of Statistics, manufacturing and market services would have contributed to the weak economic performance, while good performance in the agricultural sector cushioned the setback.

Households in Central Europe have come under pressure from high inflation, driven mainly by rising food and energy prices. Inflation in Hungary peaked at more than 25% year-on-year in the first quarter before slowing to 17.6% year-on-year in July.

The National Bank of Hungary was the first in Central Europe to lower the key interest rate from 18% to 15% in August. However, these high interest rates practically paralyzed lending, and the government’s estimates (which predicted GDP growth of 1.5%) turned out to be dust.

In a statement following the Hungarian statistics report, the economy and finance ministers said the economy will emerge from recession in the coming quarters