(Bloomberg) -- Hungary’s industrial production dropped for a sixth consecutive month, raising concern that the economy may be on the edge of another recession.
Output fell an annual 4.1% in August, according to workday-adjusted data from the statistics office published on Friday. That was more than the 2.8% median estimate of economists in a Bloomberg survey.
Hungary’s economy contracted in the second quarter and has since seen little in the way of positive economic data. While there were scant details in the preliminary industry estimate, in previous months the drop in car and battery production had fueled the downturn.
The outlook remains bleak for those sectors, which are key for a Hungarian economy that’s heavily reliant on German automakers and Chinese battery producers. The European Union is slated to vote on Friday on imposing additional tariffs on Chinese electric vehicles.
In a state radio interview on Friday, Prime Minister Viktor Orban said on the EU may he heading into an “economic cold war,” posing a “huge threat” to Hungary’s economic model.
The Hungarian currency, which had already been under pressure due to concerns about fiscal and monetary policy, was hammered this week on rising tensions in the Middle East. It’s trading near a 1.5 year-low against the euro after seven consecutive days of losses.
The government is trying to create as much economic room as possible to kickstart economic growth, Orban said, while mindful of public finances that have forced the cabinet to raise taxes and slash spending to meet an already upwardly revised budget deficit target.
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