
The surface may cool down, but instability burns underneath
Estonia should build on the competitive advantages of an efficient business environment and wide digital experience to escape stagflation.
Estonia should build on the competitive advantages of an efficient business environment and wide digital experience to escape stagflation.
Despite the wage gains in the region and retail sales up to 3%, Polish households remain cautious when making purchasing decisions.
In a deteriorating context, NBP faces the pro-inflationary impact of fiscal easing, regulatory decisions, and the uncertain economic outlook.
Market expectations of rapid disinflation remain, but underlying risks come from commodity costs, monetary supply, and trade protectionism.
The core inflation is persistently higher than headline, while expansionary fiscal policy increases the pressure and weaken the competitiveness.
The current decline in Estonia’s exports is more a reflection of the weakness in foreign markets and the problems with competitiveness.
CEE inflation remains markedly higher than in the West, and is unlikely to get back on track till late-2025.
GDP growth to be close to 2% YoY in 4Q23 and around 0.4% for the whole year, but the level of core prices stands still (8%).
The transparency in public finance is key for better controlling public spending: with 5.5-6% of GDP Warsaw has the highest deficit in the EU.
CBDC aren’t necessary, digitalization and ease are already here. What’s missing is a competitive free market transmission mechanism.