Economic Data and Policy Decisions Across Central and Eastern Europe
Central and eastern Europe faces a dense run of data and policy events, starting with July industrial production figures from the Czech Republic and Hungary. Hungary’s August inflation is forecast to tick up to 1.4% from 1.2% after months of disinflation. The National Bank of Poland is expected to keep its policy rate at 3.75% and the Central Bank of Turkey is also seen holding at 37%. Romania’s August inflation is projected to drop to 6.5% year on year from 8.2%, driven largely by base effects despite faster monthly price growth.
Market Communication and Currency Implications
Attention then turns to communication constraints and market pricing. The CNB enters its blackout period on Thursday, with bank-board commentary expected beforehand. Regional rates rose last week as global conditions eased, yet markets still price around 80bp of tightening in both the Czech Republic and Poland. Further repricing would compress interest-rate differentials and could pressure CEE currencies, with EUR/CZK seen at risk of moving back above 24.250 and EUR/PLN positioned to rise if the NBP retains a dovish stance.
