My subscription
...
Filters
My Subscription All Publications

CEE inflation broadening out

Central and Eastern European economies are experiencing their worst bout of inflation since the late-1990s as surging food and energy prices have added to strong core price pressures across a broad range of goods and services. Monetary tightening cycles are likely to continue with interest rates rising to 8% or so over the next few months and we think that rates will remain above neutral for several years. World with Higher Rates - Drop-In (21st June, 10:00 ET/15:00 BST): Does monetary policy tightening automatically mean recession? Are EMs vulnerable? How will financial market returns be affected? Join our special 20-minute briefing to find out what higher rates mean for macro and markets. Register now  
Liam Peach Emerging Markets Economist
Continue reading

More from Emerging Europe

Emerging Europe Economics Update

Russian sovereign default more symbolic at this stage

Russia’s government has now reportedly defaulted on its foreign-currency denominated debt for the first time since 1918, but this is a largely symbolic event that is unlikely to have an additional macroeconomic impact. Sanctions have already done the damage and locked Russia out of global capital markets.

27 June 2022

Emerging Europe Economics Weekly

Governments collapse, Russia set to default

Governments in Israel and Bulgaria collapsed this week which may delay support to households over the cost of living. The threat to Bulgaria’s economy is probably greater, as political instability also puts EU fund inflows and the ability to secure gas supplies at risk. Elsewhere, a 30-day grace period for Russia’s government to make interest payments on Eurobonds ends on Sunday. While Russia has signalled that it is willing to make the payments in rubles, this would be a breach of the contract and could mark Russia’s first default on foreign currency debt since the Bolshevik revolution.

24 June 2022

Emerging Europe Economics Update

CBRT: knock knock, anybody there?

High inflation, falls in the lira and aggressive monetary tightening elsewhere are clearly not enough to persuade Turkey’s central bank to lift interest rates, as it left its policy rate at 14.00% today. Disorderly falls in the lira are a major risk, which would probably be met with capital controls rather than rate hikes.

23 June 2022

More from Liam Peach

Emerging Europe Economics Weekly

Hawkish Fed adds to growing external risks

The 75bp interest rate hike by the US Fed this week and expectations for further large hikes in the coming months will have ripple effects across the region. It is likely that Hungary's central bank will be forced to raise rates to defend the forint again and we now expect the Turkish lira to end the year at 24/$. Elsewhere, the risk that gas flows from Russia to Europe are cut off has increased. The gas deal agreed between the EU, Egypt and Israel this week will boost Israel's exports, but it's likely to take many years before Israel becomes a major gas exporter. World with Higher Rates - Drop-In (21st June, 10:00 ET/15:00 BST): Does monetary policy tightening automatically mean recession? Are EMs vulnerable? How will financial market returns be affected? Join our special 20-minute briefing to find out what higher rates mean for macro and markets. Register now

17 June 2022

Emerging Europe Economics Update

Israel’s tight labour market to push up wages soon

Israel’s labour market has tightened significantly in recent months and while there is so far little sign of a burst of wage pressure coming through, this is likely to be in the pipeline and feed through into stronger core inflation next year. Alongside a more hawkish shift by the US Fed, we think the Bank of Israel will raise interest rates by 50bp in July and August and push rates from 0.75% now to 3.00% by early 2023.

14 June 2022

Emerging Europe Economics Update

CBR lowers interest rates back to pre-war levels

The Russian central bank (CBR) delivered a 150bp interest rate cut to 9.50% today as its focus continued to shift away from inflation risks towards supporting the economy. We think further reductions are likely to be more gradual, with rates ending this year at 7.50%.

10 June 2022
↑ Back to top