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
Emerging Europe Economics Update Russia: limited market fallout from Otkritie turmoil The uncertainty about how troubles at Otkritie might play out initially pushed up interbank interest rates in Russia, but the Central Bank (CBR) quickly snuffed out the rise using its open market... 30th August 2017 · 1 min read
Emerging Europe Economics Update Russia’s Otkritie bailout highlights risk from previous credit boom The Russian central bank’s decision to bail out struggling Otkritie bank provides the clearest sign yet of the damaging legacy from the sharp run-up in credit seen up to 2014. That said, the strong... 29th August 2017 · 1 min read
Emerging Europe Economics Update EM inflation likely to remain near multi-year lows The big fall in EM inflation is now behind us but it is likely to remain relatively subdued over the coming months. As a result, despite the recent shift in focus towards monetary tightening in... 24th August 2017 · 1 min read
Emerging Europe Economics Update Why Turkey’s strong recovery won’t last Turkey’s economy enjoyed a strong first half of the year, but growth is close to peaking and we think that it will slow in 2018-19, and by more than most expect. What’s more, given the vulnerabilities... 23rd August 2017 · 1 min read
Emerging Europe Economics Update Czech MPC starts gradual tightening cycle The statement accompanying the Czech MPC’s meeting, at which it hiked interest rates for the first time in nine years, was relatively dovish and adds to the impression that this will be a gradual... 3rd August 2017 · 1 min read
