Emerging Europe Economics Update Turkey’s external vulnerabilities back under the microscope Turkey’s recent diplomatic spat with the US – and the subsequent sell-off in financial markets – has refocussed attention on the economy’s external vulnerabilities. We have two areas of concern: the... 11th October 2017 · 1 min read
Emerging Europe Economics Update Poland’s MPC stays dovish, but rate hikes on the cards in 2018 Poland’s MPC left interest rates unchanged today and the press statement and conference that followed struck a dovish tone. While headline inflation is likely to edge down in the final months of this... 4th October 2017 · 1 min read
Emerging Europe Economics Update Romanian MPC begins aggressive tightening cycle The Romanian MPC’s decision to raise its overnight deposit interest rate represents a move to tighten monetary policy – even though the policy rate was left unchanged. Policymakers struck a fairly... 3rd October 2017 · 1 min read
Emerging Europe Economics Update Taking stock of our forecasts Growth in Emerging Europe has generally surprised on the upside in recent quarters, which is consistent with the above-consensus forecasts we made at the start of this year. We expect further positive... 2nd October 2017 · 1 min read
Emerging Europe Economics Update Czech MPC set to hike in November The Czech MPC’s decision to keep rates on hold today was a very close call and we think that an interest rate hike at the next MPC meeting on 2nd November is highly likely. Following that, our central... 27th September 2017 · 1 min read
Emerging Europe Economics Update Wages, not the forint, the biggest risk facing Hungary’s MPC The move by Hungary’s MPC to loosen monetary policy last week appears to have been aimed at weakening the forint, which looks to us like a step in the wrong direction. The key threat to inflation and... 26th September 2017 · 1 min read
Emerging Europe Economics Update Turkish equities tumble amid Kurdish referendum fears Worries about spillovers from the independence referendum being held today in Iraq’s Kurdish region have led to a sharp drop in Turkey’s stock market over the past week. However, any impact on Turkey... 25th September 2017 · 1 min read
Emerging Europe Economics Update EM inflation picks up from eight-year low Aggregate EM inflation rebounded in August, having fallen to an eight-year low in July. But while we expect fuel and food inflation to edge up over the coming months, easing core price pressures... 25th September 2017 · 1 min read
Emerging Europe Economics Update Hungarian MPC underestimating inflation risks The decision by the Hungarian MPC to ease monetary conditions further today looks like a policy misstep. Mounting capacity constraints and rapid wage growth mean that we think inflation will turn out... 19th September 2017 · 1 min read
Emerging Europe Economics Update How big is the overheating risk in Hungary? There are no clear signs yet that Hungary’s economy is overheating but, by the same token, growing signs that the economy is hitting capacity constraints sit uncomfortably with the MPC’s continued... 18th September 2017 · 1 min read
Emerging Europe Economics Update Russian central bank stays cautious, but more rate cuts loom Russian central bank governor, Elvira Nabiullina, struck a predictably cautious tone at today’s postmeeting press conference. But the large amount of spare capacity in the economy is likely to keep... 15th September 2017 · 1 min read
Emerging Europe Economics Update Turkish MPC takes hawkish line after inflation surprise Last month’s jump in inflation prompted the Turkish MPC to adopt a more hawkish line in the statement accompanying today’s meeting, at which interest rates were left unchanged. Even so, with inflation... 14th September 2017 · 1 min read
Emerging Europe Economics Update CEE: Domestic demand in the driving seat Recently-released GDP breakdowns for the economies of Central and Eastern Europe showed that strengthening consumer spending and investment drove the pick-up in aggregate economic growth to a nine... 7th September 2017 · 1 min read
Emerging Europe Economics Update Polish MPC remains dovish, but tightening likely next year The tone of the press statement and conference that followed today’s MPC meeting in Poland remained dovish. However, there is a hawkish minority on the Council and, as core inflation picks up in the... 6th September 2017 · 1 min read
Emerging Europe Economics Update Assessing the fallout from Russia’s Otkritie bailout The breathless commentary surrounding the recent bailout of Otkritie by Russia’s central bank appears to have missed some of the more salient points about Russia’s banking sector. As we explain in... 6th September 2017 · 1 min read
Emerging Europe Economics Update Poland: Temporary drags on core inflation to fade soon A combination of a strong currency and the fading impact of a previously-introduced levy on the financial sector has kept a lid on Polish core inflation in recent months. These effects should soon... 31st August 2017 · 1 min read
