EME Macro/Strategy: macro all-in-one (31 July-6 August)

The Czech Central Bank has opened the door to the easing cycle, pointing out that the inflation outlook is now compatible with its 2% target and it makes sense to avoid a sharp rise in the real policy rates. We see the Czech Republic as a good template for what we expect to see in the economies across Europe in the coming year. In Poland, the election campaign is continuing. A local opinion poll highlights the risk of further moderate votes leaving PiS for Confederation. Turkey’s July inflation jumped and we expect another big leap in August. Romania is approaching the finalisation of the budget measures; beware of probable tax changes in real estate and capital gains. Greece is returning to normality, after the tragic wildfires in July, and the Prime Minister has begun to highlight measures to counter the effects on tourism. Georgia has delivered mild monetary easing, as expected; while Egypt has raised interest rates again, but is not making any progress on allowing the currency to float.