Fiscal stimulus on its way

Developments this month suggest that governments in parts of the region are embarking on fiscal stimulus to boost growth and prop up popular support. Recent policy announcements in Russia and Turkey look small, although the Polish government looks set to undertake more significant fiscal loosening – potentially up to 2% of GDP. We don’t think that fiscal support will offset the impact on the region from slower global growth. But unlike in 2012 – the last major downturn in the region – governments do now have room to loosen the purse strings to soften the blow.