Next week will be quite interesting in terms of macroeconomic data out of the region. Of particular interest will be Q1 GDP numbers for Poland, Hungary, the Czech Republic and Romania. Overall, much of the data points to a continued albeit overall weak recovery in all four countries.
A continued recovery in the global economy and particularly an improvement in overall European growth is spilling over positively to central and eastern Europe. However, the overall picture is one of a not-too-impressive recovery. Things are getting better, but the CEE economies are hardly booming.
Besides the preliminary Q1 GDP numbers, inflation numbers for April across the CEE region are due to be released. The outcome will be very similar in all four countries - inflation will remain very low and well below the central banks' inflation targets. In the Czech Republic, the latest inflation readings were below the Czech central bank's forecast, which means that the koruna cap exit is likely to be delayed beyond Q1 15, despite the continued recovery in the economy. We still expect monetary policy easing in Hungary, while the Polish central bank stated this week that it will keep interest rates on hold for some time to come.
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