Food prices add to headline inflation

Current accounts’ deficits across the region. In September, Czechia, Poland and Serbia posted negative current account balances while in Romania year-to-date number was also negative.
Flash 3Q24 GDP growth in Romania landed at 0% q/q and 1.1% y/y.
In Slovakia flash 3Q24 GDP is scheduled at 9 AM CET.
At 10 AM CET, Poland will publish 3Q24 GDP data, while Slovenia is due 10.30 AM CET.

Erste Bank Research Team Erste Bank

Economic developments

We will summarize incoming flash estimates of 3Q24 on Friday, while today we focus on inflation numbers. In October, headline inflation increased in all the CEE countries but Slovenia. The energy and food prices are behind such development. In some of the countries such as Czechia or Poland, headline inflation footprints were expected to rise toward the end of 2024. In other such as Slovakia, where we have seen HICP flash estimate but we expect local release to confirm the upward trend, the increase in food prices was particularly high, driving the October’s inflation up and actually, unexpectedly high. In Romania, inflation surprised to the upside as well but it is at the lowest levels in three years. While in Slovakia local factor may play a role, in general, the development of World Food Price Index suggest that food prices are likely to increase and contribute positively to the headline inflation numbers in the short-term. The World Food Price Index rose to 127.4 in October that is the highest in year and a half.

Download the Full Report!

Author

Erste Bank Research Team

Erste Bank

At Erste Group we greatly value transparency. Our Investor Relations team strives to provide comprehensive information with frequent updates to ensure that the details on these pages are always current.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.