Eastern European economies have relied on domestic consumption as a lifeline to stay afloat as Germany, the region’s main trading partner, is struggling to avoid recession. The prognosis could worsen if US President-elect Donald Trump follows through on pledges to raise tariffs. The trend was evident elsewhere. While the Czech Republic managed to grow in the third quarter, Hungary unexpectedly slipped into a recession, as domestic consumption failed to make up for a deep downturn in industrial production, according to data released over the last month.

“Households, despite the improving financial situation and favorable labor market, choose not to increase spending and prefer instead to save in uncertain times,”

“The tariff regime that Trump promised is expected to hit the German economy very hard, and an even weaker German growth dynamic would have a whiplash effect in Hungary,” Savos said at an event in Budapest Thursday. “It is a major risk.”