Erste Bank Research Team
Erste Bank
On the radar
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In Poland, industrial output growth declined by -0.3% y/y in September. Producer prices went down by -6.3% y/y. Employment dropped by -0.5% y/y while wages increased by 10.3% y/y
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Producer prices in Slovenia declined by -0.9% y/y in September.
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In Croatia, September’s unemployment rate declined to 4.6% while August’s real wage grew by 11.9% y/y.
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In Hungary, real wage growth arrived at 9.4% y/y.
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Today, there is Hungarian central bank meeting, and we expect no change in key policy rate.
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In Poland, real retail sales will be published for September at 10 AM CET.
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Slovenia will publish real wage growth for August.
Economic developments
In September 2024, new EU car registrations continued their downward trajectory (-6.1%) with negative results across three of the region’s four major markets: France (-11.1%) and Italy (-10.7%), with the German market declining by 7%. Year-to-date performance remains marginally positive in the EU. As far as the region is concerned, the growth was negative in three countries in September 2024. Hungary had a slight decline (-0.5%), while Romania and Slovakia experienced the greatest slumps (-14.9% y/y and -7.8% y/y respectively). Other countries saw positive growth dynamics in September 2024. Year-to-date, new car registrations are higher in all countries. Croatia and Poland have so far outperformed their peers with double-digit growth dynamics. Hungary and Slovenia have also shown solid year-to-date performance.
Market developments
CEE currencies weakened against the euro at the beginning of the week, while long-term yields edged slightly up apart from Croatia and Romania. Today, the Hungarian central bank holds a rate-setting meeting, and we expect no change in the key policy rate due to the weakness of the Hungarian forint. Deputy Governor Virag suggested such a scenario, indicating a break in monetary easing. Furthermore, it seems that the break may last for a "sustained period" if the external environment and inflation outlook justify a cautious approach. It will be interesting to hear the statement and comments from the central bank after the decision. Romania held a successful bond auction of 2029 government papers, selling more than planned (RON 990.1 million).
This document is intended as an additional information source, aimed towards our customers. It is based on the best resources available to the authors at press time. The information and data sources utilised are deemed reliable, however, Erste Bank Sparkassen (CR) and affiliates do not take any responsibility for accuracy nor completeness of the information contained herein. This document is neither an offer nor an invitation to buy or sell any securities.
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