Downward forecast revisions have persisted across Central and Eastern Europe, dragging the regional GDP growth average for 2013 down. Growth will exceed paltry activity in Western Europe, but more vibrant estimates for Asia Pacific and, to a lesser extent, Latin America put its performance in the shade.
The legacy of the uncontrolled boom in credit and external debt will take time to unwind, limiting the near-term growth potential of most countries. The Czech Republic, Slovenia and Ukraine bore the brunt of the latest round of forecast downgrades.
Vulnerable to a withdrawal of finance from euro zone banks and erratic swings in sentiment, the outlook for private consumption and investment remains sluggish. A run on emerging market assets occured last month, on speculation that the US will scale back its rate of quantitative easing.
Growth forecasts for Turkey have not changed much despite a recent spread of anti-government protests. However, despite signs of improvement in crude oil, our panellists have become less optimistic about the expansion in Russia after it stalled in Q1.
You can download a sample of Eastern Europe Consensus Forecasts at www.consensuseconomics.com.