Emerging Europe Economics Update Retail spending to remain a soft spot in Russia’s recovery The recent slowdown in Russian retail spending appears to be close to bottoming out. But we doubt that retail sales will grow by any more than 2.0-2.5% y/y over the next twelve months. 4th December 2018 · 1 min read
Emerging Europe Economics Update Lower oil prices shouldn’t derail Russia’s recovery The latest fall in oil prices will reduce Russia’s export revenues, but the budget and current account should remain in surplus and a significant shift in fiscal (or monetary) policy is unlikely. As a... 28th November 2018 · 1 min read
Emerging Europe Economics Update Fiscal support will boost Polish & Czech economies Strong budget positions in Poland and the Czech Republic will allow governments to ramp up spending next year. That’s one key reason why we expect that GDP growth in 2019 in these countries will be... 27th November 2018 · 1 min read
Emerging Europe Economics Update How will Hungary’s National Bank tighten policy? We’ve argued for a long time that the monetary stance of the Hungarian National Bank (MNB) is far too accommodative, and it finally appears that tightening is on the horizon. The complex nature of the... 19th November 2018 · 1 min read
Emerging Europe Economics Update Turkey: weaker lira softening the blow The sharp fall in the Turkish lira since the start of the year has pushed up inflation and caused financial conditions to tighten markedly, tipping the economy into recession. But there are signs that... 13th November 2018 · 1 min read
Emerging Europe Economics Update Has a weaker ruble helped Russia’s economy? There’s little evidence so far to suggest that the fall in the ruble this year has boosted Russia’s economy, but we think the positive effects will begin to materialise in 2019. 9th November 2018 · 1 min read
Emerging Europe Economics Update Car emission tests not the key driver of CEE Q3 slowdown The net impact of a new vehicle emissions testing procedure on Q3 GDP growth appears to have been minimal in Poland and the Czech Republic, but could have knocked up to 0.4%-pts off quarter-on-quarter... 8th November 2018 · 1 min read
Emerging Europe Economics Update Poland: More hawkish tone suggests rate hikes are near The relatively more hawkish tone adopted by the Polish MPC in its post-meeting press conference today suggests that the start of a monetary tightening cycle isn’t too far away. We think that... 7th November 2018 · 1 min read
Emerging Europe Economics Update Czech Republic: Still scope for more tightening in 2019 The forecasts accompanying today’s Czech monetary policy meeting imply that the CNB’s tightening cycle is now finished. Following seven interest hikes, we agree that the bulk of tightening has already... 1st November 2018 · 1 min read
Emerging Europe Economics Update Russian central bank not inclined to tighten further The Russian central bank’s statement accompanying today’s Board meeting reinforces our view that September’s interest rate hike was intended as a one-off. Whereas the financial markets are pricing in... 26th October 2018 · 1 min read
Emerging Europe Economics Update Turkey: further rate hikes unlikely to materialise The Turkish central bank’s decision to leave interest rates unchanged today and the accompanying statement reinforce our view that last month’s aggressive rate hike didn’t represent a shift back to... 25th October 2018 · 1 min read
Emerging Europe Economics Update Ukraine: New IMF deal a positive, but still not in the clear The announcement on Friday that Ukraine has come to an agreement with the IMF to replace its current bailout package should reduce risks posed by the government’s large upcoming FX debt repayments... 22nd October 2018 · 1 min read
Emerging Europe Economics Update Turkey: latest steps to tackle inflation lack real punch The Turkish government’s latest plan to tackle high and rising inflation will probably have a limited impact and it reinforces our view that last month’s aggressive interest rate hike did not herald a... 10th October 2018 · 1 min read
Emerging Europe Economics Update Strength of Romanian leu built on shaky foundations The Romanian central bank’s FX intervention this year has kept the leu artificially strong, causing economic imbalances to build. Unless policymakers change course soon and loosen their grip on the... 10th October 2018 · 1 min read
Emerging Europe Economics Update Polish MPC in dovish mood … for now Poland’s MPC maintained a dovish stance today. On the face of it, low inflation suggests that this position is justified, but we think that policymakers are too sanguine on the outlook for consumer... 3rd October 2018 · 1 min read
Emerging Europe Economics Update Russia’s economy still has some slack Russia’s recovery doesn’t appear to have used up the spare capacity in the economy and we estimate that there is an output gap of about 1% of potential GDP. That means there’s scope for GDP to grow... 2nd October 2018 · 1 min read
