CEE: First releases of Q1 GDP arriving

On the radar

• 1Q25 GDP in Czechia landed at 2.0% while Hungarian economy stagnated.

• Serbian economy grew by 2.0% y/y (surprise to the downside).

• Inflation rate in Poland eased to 4.2% y/y in April.

• Flash estimates in Slovenia show increased of inflation to 2.3% y/y.

• In Croatia retail sales grew by 3.6% y/y while industry expanded by 3.0% y/y in March.

• In Serbia, retail sector stagnated in March while industry grew 6.9% y/y.

• Manufacturing PMI in Romania arrived at 48.3. PMI indices for April will be published in other CEE as well.

• At 11 AM CET Croatia will release flash estimate of inflation in April.

Economic developments

In the 1Q25, seasonally adjusted GDP increased by 0.4% q/q in the euro area and by 0.3% q/q in the EU, translating into 1.2% y/y growth dynamics in the euro area and 1.4% y/y in the whole EU. Within the region, Czechia, Hungary, and Serbia published their flash estimates of 1Q25 GDP as well. Czechia expanded in line with expectations as the economy grew 0.5% q/q and 2.0% y/y, marking a solid beginning of the year. On the other hand, Hungary underperformed again as the economy fell by 0.2% on a quarterly basis, and in y/y terms, the economy stagnated. The Hungarian economy cannot sustain an improving trajectory, indicating weak underlying processes and structural problems. Furthermore, the Serbian economy also surprised to the downside as it grew by just 2% y/y in the first quarter of 2025, which is well below our expectations (point 1Q25 forecasts at 3% y/y) and Bloomberg consensus at 3.5% y/y. Other countries will publish data on 1Q25 GDP in mid-May only, while the structure of the growth will be released at the end of May and the beginning of June in all CEE countries.

Economic developments

In the 1Q25, seasonally adjusted GDP increased by 0.4% q/q in the euro area and by 0.3% q/q in the EU, translating into 1.2% y/y growth dynamics in the euro area and 1.4% y/y in the whole EU. Within the region, Czechia, Hungary, and Serbia published their flash estimates of 1Q25 GDP as well. Czechia expanded in line with expectations as the economy grew 0.5% q/q and 2.0% y/y, marking a solid beginning of the year. On the other hand, Hungary underperformed again as the economy fell by 0.2% on a quarterly basis, and in y/y terms, the economy stagnated. The Hungarian economy cannot sustain an improving trajectory, indicating weak underlying processes and structural problems. Furthermore, the Serbian economy also surprised to the downside as it grew by just 2% y/y in the first quarter of 2025, which is well below our expectations (point 1Q25 forecasts at 3% y/y) and Bloomberg consensus at 3.5% y/y. Other countries will publish data on 1Q25 GDP in mid-May only, while the structure of the growth will be released at the end of May and the beginning of June in all CEE countries.

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