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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Croatia: Consumer prices fall for the fifth-consecutive month in annual terms in August
September 16, 2020
Consumer prices dropped 0.10% over the previous month in August, a weaker decline than July’s 0.49% drop.
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Bulgaria: Inflation remains stable in August
September 15, 2020
Consumer prices rose 0.04% over the previous month in August, moderating from July's 0.47% rise.
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Poland: Inflation eases in August
September 15, 2020
Consumer prices dropped 0.10% from the previous month in August, following July’s 0.20% drop.
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Romania: Decline in Industrial output softens in July
September 14, 2020
Industrial production declined 9.9% on a working-day and seasonally-adjusted year-on-year basis in July, a smaller contraction than June’s 14.3% drop.
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Hungary: Second estimate confirms decline in industrial activity softened in July
September 12, 2020
According to a second estimate by the Statistical Institute, industrial output declined 7.7% in year-on-year, working-day adjusted terms in July, which was markedly softer than June's 12.2% dive and matched the first estimate. The softer drop was mainly driven by a weaker contraction in manufacturing production, although it still continued to shrink at a marked pace.
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