CEE growth forecasts close to IMF

On the radar

• Romania's September CPI accelerated to 6.6% y/y.
• In Czechia, headline inflation accelerated to 2.5% y/y in September.
• Slovakia's August wage growth data are to be released today at 09:00 CET.
• In Poland, the final September CPI reading is due today.
• August trade balance data for Poland are also scheduled for today at 14:00 CET.

Economic developments

Following the release of the IMF’s October World Economic Outlook, we compare our GDP forecasts with the Fund’s latest projections for CEE. For emerging and developing Europe, the IMF sees the outlook shaped by higher energy costs, security-related uncertainty and tighter financing conditions. Economies reliant on fossil fuel imports or characterised by energy-intensive industries face weaker growth prospects, although this is expected to be partly offset by higher defence spending. Accordingly, our 2026 forecasts remain close to the IMF’s, with differences of no more than 0.3pp across the seven CEE economies. Both forecasts identify Poland as the fastest-growing economy, at 3.6% in our baseline and 3.4% in the IMF’s, while Romania is the only economy expected to contract, by 0.7% and 0.5%, respectively. In Slovenia, both forecasts are aligned at 3.2%. Differences become more evident in 2027, with our projections exceeding IMF in five of the seven economies. The largest gap is in Czechia, where we forecast growth of 2.5% compared with the IMF’s 1.9%. This also reflects Czechia’s exposure to German demand, with the IMF expecting German growth to slow to 1.1% in 2027 from 1.3% this year. Overall, the IMF’s projections support our outlook, with both pointing to faster growth in five of the seven CEE economies in 2027, although the pace of the recovery will remain contingent on energy prices and external demand.

Market movements

Hungary received a positive signal from the EU after member states approved the release of EUR 4.2bn in previously frozen funds and restored access for Hungarian universities to the Erasmus+ and Horizon Europe programmes. The decision reduces uncertainty around EU-Hungary relations, although the near-term growth impact is likely to remain modest, with GKI estimating an additional 0.1-0.2pp contribution to GDP growth in 2026-27. Markets reacted calmly, as the forint strengthened by around 0.3% d/d to 363.5/EUR, while the 10Y Hungarian government bond yield declined by roughly 6bp to 5.51%. Fiscal risks nevertheless remain in focus after the 2026 deficit target was revised to 7.5% of GDP. In Croatia, PM Plenković said public debt should fall to around 55.5% of GDP by year-end, while the government announced a EUR 260m anti-inflation package.

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