Emerging Europe Economics Is it time to worry about Romania’s current account? The widening of Romania’s current account deficit to a 10-year high partly reflects a rise in foreign firms’ reinvested earnings which is not a concern. But the trade balance has also worsened and the... 3rd August 2021 · 3 mins read
Emerging Europe Economics Update MNB steps up front-loaded tightening cycle The larger-than-expected 30bp interest rate hike by Hungary’s central bank (MNB) today was accompanied by hawkish comments that send a strong message about its intention to bring inflation back to its... 27th July 2021 · 3 mins read
Emerging Europe Economics CBR hikes rates sharply, but cycle nearing an end Russia’s central bank (CBR) opted for a larger 100bp interest rate hike, to 6.50%, at today’s meeting and the accompanying communications provided clear guidance that the tightening cycle is nearing... 23rd July 2021 · 3 mins read
Emerging Europe Economics Update Israel and the Delta variant: what we know so far A rise in virus cases in Israel has prompted the government to re-impose restrictions on activity, including mask mandates and vaccine certification for large events. There are signs that the Pfizer... 23rd July 2021 · 5 mins read
Emerging Europe Economics Update Russia: surging inflation to prompt more rate hikes Russian inflation shows no sign of letting up and looks set to remain above the central bank’s 4% target until at least the end of next year. With households’ inflation expectations also rising, we... 19th July 2021 · 5 mins read
Emerging Europe Economics Update NBP in no rush to tighten policy Poland’s central bank left interest rates on hold today and, while it revised up its GDP growth and inflation forecasts, there was little sign in the accompanying press statement that the balance on... 8th July 2021 · 3 mins read
Emerging Europe Economics Update Turkey’s inflation risks mount, CBRT to delay rate cuts Turkish inflation hit a two-year high in June and recent domestic energy price hikes will cause it to rise even further over the next couple of months. High inflation and signs of a quick recovery... 7th July 2021 · 4 mins read
Emerging Europe Economics Update BoI withdraws support, but no sign of tightening Israel’s strong economic recovery prompted the central bank to phase out one of its emergency support programmes at today’s meeting and Governor Yaron’s comments suggest that the next step towards... 5th July 2021 · 3 mins read
Emerging Europe Economics Update Russian ruble may hold onto some of this year’s gains The Russian ruble appreciated to a one-year high against the dollar recently but we think the rally will fade as oil prices fall back and US Treasury yields rise further. That said, the central bank’s... 2nd July 2021 · 3 mins read
Emerging Europe Economics Update Russia: a strong recovery in Q2, but risks ahead Another strong batch of activity data for May suggest that Russia’s economy may have returned to just shy of its pre-pandemic level in Q2. The foundations are in place for the recovery to continue in... 1st July 2021 · 2 mins read
Emerging Europe Economics Update CNB starts lift-off, aggressive tightening cycle in store The Czech National Bank (CNB) raised its two-week repo rate by 25bp to 0.50% at today’s meeting and the accompanying communications support our view that this marks the start of what will be the most... 23rd June 2021 · 3 mins read
Emerging Europe Economics Update Hungary: a short, sharp tightening cycle takes hold Hungary’s central bank (MNB) raised interest rates by 30bp today and with inflation set to remain above the MNB’s 4% upper tolerance level well into 2022, we expect an additional 60bp of tightening at... 22nd June 2021 · 3 mins read
Emerging Europe Economics Update Poland: Hawks to remain in the minority … for now While policymakers in Hungary and Czechia look set to lift interest rates from their pandemic lows later this week, we doubt that Poland’s central bank will follow suit this year. That said, with... 21st June 2021 · 6 mins read
Emerging Europe Economics Update CBRT still treading cautiously The statement accompanying today’s decision by the Turkish central bank (CBRT) to leave its policy rate at 19.00% suggests that policymakers are (for now) standing up to political pressure to lower... 17th June 2021 · 3 mins read
Emerging Europe Economics Update Gas sector expansion to boost the Israeli Shekel A further expansion of gas production is likely to boost Israel’s current account surplus by an additional 0.4% of GDP per annum by 2025. This will put upwards pressure on the real exchange rate, but... 16th June 2021 · 5 mins read
Emerging Europe Economics Update Russia: consumer spending recovery has further to run Russian household spending looks set to rebound strongly this year as “excess” savings are drawn down, credit continues to expand, government support boosts incomes, and the labour market recovers... 15th June 2021 · 5 mins read
