Survey finds economic outlook for emerging Europe improves

By bne IntelliNews July 7, 2009

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A survey of financial experts released July 2 shows that optimism over the economic outlook for Central and Southeast Europe has continued to improve.

In its latest monthly survey of 66 financial market experts conducted between May 28 and June 15, the Centre for European Economic Research in Mannheim (ZEW) and Erste Bank found that the economic outlook for the region, as measured by their economic sentiment indicator, had improved by 14.4 points to 20.4 points. "For the first time since the beginning of the survey, positive expectations (40.8%) outweighed the neutral forecasts (38.8%)," the authors of the accompanying report noted.

Although the economic expectations for emerging Europe in general have improved, the survey found that forecasts for some of the individual countries have worsened in the current survey, even if they remain positive in most countries. Notwithstanding the 5.0-point decrease to 19.1 points in the survey, the Czech sentiment indicator kept its leading position in comparison to other countries. The outlook for Hungary was judged to be the worst of the bunch.

The current economic environment is, however, assessed more cautiously by the experts and remains well in the red. The indicator of current conditions for the CEE region dropped slightly by 0.9 points to minus 61.3 points in June.

With regard to inflation rate expectations, clearly more experts polled anticipate a growing inflation risk to accompany the cyclical recovery in the region. Even so, the majority of survey participants foresee disinflation in the region continuing overall.

The analysts' expectations for the stock markets in the next six months also improved in June, with the indicator for the stock index NTX in the region increasing by 5.1 points to 25.5 points.


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