Central Banks across the region are turning hawkish, despite the fact that their counterparts in the West are adopting an increasingly dovish stance in the face of a global economic slowdown. The problem for policymakers in Emerging Europe is that inflation pressures have continued to mount as spare capacity dwindles. The National Bank of Poland is likely to follow up last month’s 25bps hike in interest rates with further tightening. Interest rates also have further to rise in the Czech Republic. Meanwhile, a recent bout of currency weakness is likely to prompt a pause in the easing cycle in Turkey, while similar concerns look set to prompt a rate hike in Hungary.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services