Vaccine offers hope, but challenges still lie ahead

Daily new COVID-19 infections have levelled off or fallen in most parts of Central Europe and there are signs that activity has started to rebound. But the fresh rise in new cases this month in Slovakia and the Czech Republic underlines the challenges facing the region and policymakers will probably keep virus restrictions tight until a vaccine is distributed next year. Outbreaks are much worse in Turkey and Russia. In Turkey, policymakers have responded by announcing a full lockdown in January which threatens what has so far been a very strong recovery. Activity in Russia’s economy has held up well so far in Q4 and policymakers seem unwilling to tighten measures further given that vaccine distribution is round the corner.
William Jackson Chief Emerging Markets Economist
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