Hungary’s retail sales data positively surprised in April with a calendar-adjusted increase of 5% year on year, the strongest growth in over a year and above consensus. Unadjusted data showed a 6.8% (chart) rise, while the monthly growth was 2.0%, driven by the Easter holiday sales.

The figures point to a continued recovery in household consumption, supported by improving income conditions and government measures.

Despite the targeted intervention in food prices with the 10% cap on profit margins for retailers, it was not grocery stores but non-food retailers and online platforms that led the recovery.

Internet and mail-order retail volumes jumped 9.1% y/y, underscoring a shift in consumer preferences and suggesting households are reallocating spending towards durable and discretionary items.

Adjusted food sales rose by 3.7%, non-food sales were up 4.0%, and fuel sales increased by 2.4%. On a monthly basis, retail turnover climbed 2.0%, adjusted for seasonal and calendar effects.

In absolute terms, April retail sales amounted to HUF1.7 trillion (€4.2bn). Food products accounted for 50% of the total, non-food items for 35%, and fuel sales for 15%.

In the first four months, retail sales rose 3.4% adjusted and 2.7% unadjusted compared to the same period of 2024. Adjusted food sales increased by 3.3%, non-food sales by 5.1%, and fuel sales by 1.2%.

Following the release of the data, the National Economy Ministry highlighted the "dynamic growth" in retail activity and reiterated the government’s commitment to curbing "unjustified price increases". The 10% cap on markups for basic food items had led to a 19.5% average price cut, while a similar 15% cap on household items had brought prices down by 26.6%, it added.

"With investment activity sluggish and export capacity expansions delayed, consumer spending could remain the main growth engine in 2025," National Economy Minister Marton Nagy added.

Pensioners will receive HUF30,000 food vouchers in the coming weeks and talks are ongoing with pharmaceutical companies on voluntary price controls, the ministry added.  

These unorthodox measures are seen as early manoeuvres ahead of the April 2026 parliamentary election. Economists note that while these may provide short-term relief and support consumption, they risk distorting market competition and having negative fallouts in the long run.

Retail association OKSZ warned of mass store closures in the countryside if the measure is extended beyond the end of August deadline.

Analysts expect retail growth to continue in the coming months as real wages rise in tandem with easing inflation. Additional stimulus is anticipated in the second half of the year, as expanded family support measures take effect, including income tax exemptions for parents.

According to the central bank’s latest household survey, nearly half of the beneficiaries intend to use these funds for daily expenses, potentially boosting near-term consumption.