Economic Snapshot for Central & Eastern Europe
June 9, 2020
Central & Eastern Europe growth to lose traction in 2020
The regional economy will be hard hit by the health crisis this year. A marked increase in the jobless rate and weaker wage dynamics will hammer consumer spending, while investment activity will shrink due to vanishing foreign demand, businesses closures, disrupted supply chains and elevated uncertainty ahead. Possible flare-ups of the pandemic cloud the outlook.
CEE Monetary & Financial Sector News
Regional inflation slumped from 3.4% in March to 2.5% in April, on falling energy prices. This year, inflation is set to cool considerably from 2020 on the back of wider output gaps, lower global oil prices and subdued wage pressures. That said, disrupted supply chains, rising food prices and extremely loose fiscal and monetary policy stances could deliver upside surprises.
At its latest meeting, the National Bank of Poland cut rates to a new all-time low and reaffirmed its quantitative easing program. Meanwhile, the Central Bank of Romania slashed rates and confirmed liquidity measures, while Hungary’s Central Bank stayed put on rising optimism about the recovery. This year, policy stances will remain firmly expansionary.
Over the last few weeks, most local currencies have gained considerable ground against the EUR. Investors’ risk appetite strengthened on vaccine hopes and as easing lockdown measures fueled expectations that the worst of the fallout from Covid-19 may have passed. Going forward, regional currencies should hover around current levels.
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5 years of Central & Eastern Europe economic forecasts for more than 30 economic indicators.
Central & Eastern Europe Economic News
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Lithuania: Inflation rises in June
July 10, 2020
Consumer prices rose 0.51% from the last month in June, contrasting the 0.48% drop logged in May.
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Slovenia: Industrial output falls in May
July 10, 2020
Industrial production slid 16.9% year-on-year in May (April: -22.8% yoy).
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Bulgaria: Industrial activity falls at sharpest rate since September 2009 in May
July 9, 2020
Industrial output dived 16.1% in year-on-year terms in May, which was a larger contraction than April's 15.9% plunge.
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Hungary: Inflation rises in June
July 8, 2020
Consumer prices increased 0.40% in June over the previous month, matching May’s result.
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Czech Republic: Industrial activity crashes again in May
July 7, 2020
Industrial output plummeted 25.7% year-on-year in working-day adjusted terms in May, which followed April's 33.7% record-breaking collapse.
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