中欧与中亚周报：焦点转向央行决策与通胀数据

Poland and Turkey will announce monetary policy decisions next week, while Hungary and the Czech Republic will release key inflation and activity data

While National Bank of Poland Governor Adam Glapiński was surprisingly dovish at the July press conference – even raising the suggestion of a rate cut after the summer holiday – the rest of the Monetary Policy Council was more cautious about the room for monetary easing. Given uncertainties regarding the inflation outlook and the fact that, according to the August flash estimate, it rose towards the upper bound of acceptable deviations from the central bank target, we expect the main policy rate to remain unchanged at 3.75% not only this Wednesday but also for the rest of the year.

Following a disappointing performance in June, we expect a rebound in industrial production in Monday's release, which is in line with the jigsaw pattern of monthly performance that has recently emerged. A good start to the third quarter will be crucial for avoiding a quarterly drop in GDP, as the heatwave and the related energy crisis will definitely bring a significant decrease in industrial production volumes in August due to voluntary production reduction.

Tuesday brings the release of August inflation. The latest increase in fuel prices will not go unnoticed this time, as the government phased out price caps in late June and the timing of data collection was favourable in July. We estimate that fuel prices will add roughly 0.10-0.15ppt to the monthly inflation rate in August. Additionally, the weakening of the forint since mid-June may also have an impact, primarily on processed food and durables. However, some seasonal factors will counterbalance this, with an expected 0.2% monthly inflation reading pushing up the headline figure after months of disinflation. In our view, the 1.4% figure itself won’t make the Monetary Council stop cutting interest rates. Still, rising yields, higher energy prices and a weaker HUF make the picture more complex.

Industrial output growth likely remained robust in July, as the Czech industrial base has found solid ground and is propelled by a solid inflow of new orders. The trade balance is set to have flipped into a slight deficit in the same month. The unemployment rate is expected to have remained unchanged in August despite the renewed hiring in manufacturing, as it will take a bit of time before it gains tangible strength. The August headline inflation reading is set to be confirmed in the refined release, while the focus will be on imputed rents and regulated energy prices, which we expect to have firmed up.

Towards the end of August, the Central Bank of Turkey took a step to normalise liquidity and started weekly repo auctions. Accordingly, the effective cost of funding and TLREF dropped directly to the level of the policy rate at 37% from 40%. The CBT is likely to remain on hold in the September meeting this Thursday after this liquidity move. We see two 100bp cuts to 35% in the last quarter given the weaker-than-expected 2Q GDP data and further gradual cooling of inflation, though any further escalation in the Gulf conflict would add to upside risks. We see the policy rate at 35% by the end of 2026.