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23 Jan 2015
ECB’s bond buying to benefit CEE – BAML
FXStreet (Barcelona) - Analysts at Bank of America-Merrill Lynch, argue that ECB’s bond buying will boost growth in CEE, further anticipating Hungarian and Polish GDP to grow to 3.9% and 3.5% respectively in 2015.
Key Quotes
“CEE growth prospects have improved as a result of the ECB’s bold asset purchase program and low commodity prices. These two factors will have positive repercussions for private sector confidence and improve the trade balance outlook.”
“We thus lift our GDP forecast projections by c.a. 0.3p.p. for this year and next, taking Hungarian real GDP growth to 3.9% this year and 2.9% in 2016; and Polish growth to 3.5% this year and 3.7% in 2016.”
“Inflation will struggle to return to the central banks’ target due to persistent low commodity prices. We thus reiterate the case for lower interest rates in Poland and see Hungary on hold at 2.10% through the end of 2016.”
Key Quotes
“CEE growth prospects have improved as a result of the ECB’s bold asset purchase program and low commodity prices. These two factors will have positive repercussions for private sector confidence and improve the trade balance outlook.”
“We thus lift our GDP forecast projections by c.a. 0.3p.p. for this year and next, taking Hungarian real GDP growth to 3.9% this year and 2.9% in 2016; and Polish growth to 3.5% this year and 3.7% in 2016.”
“Inflation will struggle to return to the central banks’ target due to persistent low commodity prices. We thus reiterate the case for lower interest rates in Poland and see Hungary on hold at 2.10% through the end of 2016.”