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Central Europe to lead the way, Russia & Turkey to disappoint

The recovery in Emerging Europe has moved onto a firmer footing in recent months and we expect growth to accelerate over the coming quarters. However, the recovery is likely to be patchy and uneven. The economies of Central Europe - notably Poland - will lead the way. By contrast, the outlook for the region's two largest economies - Russia and Turkey - is more challenging. All told, we expect GDP in Emerging Europe to grow by 2.0% in 2014 and 2.5% in 2015, up from 1.8% in 2013. In most countries, inflation is likely to be subdued, allowing monetary policy to remain loose in order to support the recovery. However, Russia and Turkey are important exceptions.

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