Emerging Europe Economics Update Currency effects begin to unwind The effects of sharp falls in EM exchange rates since 2014 – which pushed inflation up to multi-year highs in a number of major economies – are now starting to fade. Assuming there isn’t another big... 26th April 2016 · 1 min read
Emerging Europe Economics Update Turkish inflation to continue easing (for now) The sharp decline in Turkish inflation since January has caught many (ourselves included) by surprise and we think the headline rate is likely to continue to fall over the rest of this year. That... 21st April 2016 · 1 min read
Emerging Europe Economics Update Russia’s central bank can ride the wave of surplus liquidity The Russian government’s use of its oil funds to finance the budget deficit will cause the monetary base to expand and is likely to push the banking sector from having a deficit of liquidity to a... 21st April 2016 · 1 min read
Emerging Europe Economics Update New Turkish central bank governor likely to cut rates further The Turkish MPC’s 50bp cut in the overnight lending rate today, to 10.0%, was pinned on the recent improvement in inflation (although political pressure no doubt played a role) and with the headline... 20th April 2016 · 1 min read
Emerging Europe Economics Update Why Ukraine still needs the IMF At first sight, the sharp fall in Ukraine’s current account deficit over the past few years suggests that the economy’s external vulnerabilities have diminished significantly. But that masks the fact... 19th April 2016 · 1 min read
Emerging Europe Economics Update Has Turkey regained competitiveness? There is some evidence that the fall in the lira in the past few years has led to import substitution in parts of Turkey’s manufacturing sector, suggesting that the economy’s competitiveness has... 12th April 2016 · 1 min read
Emerging Europe Economics Update Resignation of Ukrainian PM reignites concerns over IMF deal The resignation of Ukraine’s prime minister on Sunday, coming alongside waning support for the government, will reignite concerns over the future of the country’s frozen IMF programme. While for now... 11th April 2016 · 1 min read
Emerging Europe Economics Update Polish MPC conference points to rates staying on hold The Polish MPC made it clear once again at this afternoon’s post-meeting press conference that it’s not likely to loosen monetary policy in the near future. Although inflation will remain subdued, so... 6th April 2016 · 1 min read
Emerging Europe Economics Update Next Turkish central bank governor faces unenviable job Uncertainty regarding who will take over at the helm of the Turkish central bank when the current governor’s term expires this month has raised concerns that a government loyalist could be put in... 5th April 2016 · 1 min read
Emerging Europe Economics Update Romanian MPC hints at rate hikes, Czech MPC stays dovish The Romanian MPC’s press conference this afternoon reinforced our view that concerns about loose fiscal policy will prompt a move towards tighter monetary conditions. This might happen as soon as the... 31st March 2016 · 1 min read
Emerging Europe Economics Update Inflation rises in commodity consumers but stays below target Seasonal factors pushed up food inflation in Asia last month, but the underlying picture is that inflation remains below target in commodity-consuming EMs in Asia as well as in Central Europe. In... 29th March 2016 · 1 min read
Emerging Europe Economics Update Ruble rebound leads market rally in Emerging Europe Financial markets across Emerging Europe have recouped some of their earlier losses this month. The Russian ruble has been the region’s star performer, posting the largest gains among all EM... 29th March 2016 · 1 min read
Emerging Europe Economics Update Turkish MPC bows to government pressure The Turkish central bank’s surprise decision to reduce its overnight lending rate by 25bp to 10.5% today was dressed up as a move to simplify the monetary setup, but it appears to be a result of... 24th March 2016 · 1 min read
Emerging Europe Economics Update Hungary’s easing cycle has further to run The weak inflation outlook and prospects for slower growth mean Hungary’s easing cycle, which resumed today, has further to run – we anticipate a few more small rate reductions in the coming months... 22nd March 2016 · 1 min read
Emerging Europe Economics Update What’s behind the slowdown in capital outflows from Russia? Capital outflows from Russia have slowed markedly in recent quarters and the nature of these outflows has changed too – they are now driven by Russian companies repaying their external debts, rather... 22nd March 2016 · 1 min read
Emerging Europe Economics Update Russian central bank continues to strike cautious note The statement by Russia’s central bank following its decision to leave its one-week repo rate unchanged earlier today was decidedly cautious and reinforces our view that any policy easing is only... 18th March 2016 · 1 min read
