Further evidence of a Q4 slowdown

Data released over the past month suggest that regional GDP growth slowed from to 2.4% y/y in Q3 to a two-year low of 1.2% y/y in Q4. This was due mostly to the economic slump in Turkey, where activity has collapsed in the aftermath of last year’s lira crisis. But it appears that growth softened throughout Central and Eastern Europe too. Indeed, full-year data GDP data released in Poland imply that growth eased there in Q4. While there are tentative signs that Turkey’s recession is close to a trough, the slowdown in CEE will continue over the course of 2019 as external demand weakens.