Most economies in Emerging Europe posted positive quarterly growth in Q2 and some countries, notably Russia and Turkey, remain on track for an impressive rebound this year. However, a number of factors suggest that Q2 will mark the high point for growth in the region. For a start we expect global growth to slow over the next year, particularly in key export markets in Western Europe. Commodity prices are likely to fall too, which will act as a brake on the Russian recovery. Moreover, while there are tentative signs that consumer spending in parts of the region is starting to accelerate, a combination of weak labour markets, tight credit conditions and a fiscal squeeze in pretty much every country means that this is unlikely to last. A ‘double dip’ recession should be avoided. But while the region’s economy is likely to expand by close to its potential rate of around 4% this year, a number of years of sub-par growth are then likely to follow.