Prolonged containment measures mean that activity in Emerging Europe will remain depressed for longer than we had previously expected. But the region is well-placed to access and distribute vaccines, which should allow activity to recover more quickly than in most other EM regions. The outlook is brightest in Central Europe, while Russia’s recovery will be held back by a tighter fiscal stance. Turkey’s central bank will keep monetary conditions tight, which will help it to claw back its battered credibility, although it will take the steam out of the economy. Inflation should ease sharply this year in Russia and Central Europe, and we think that interest rates will be kept low for longer than investors and most analysts currently expect.
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