Erste Group Research

What’s up in CEE? | CEE | Economy

15. September 2022

Winter is coming
Recent economic developments bring growing concerns that part of the region will face technical
recession in the second half of the year and forcing a major downward revision of 2023 GDP
growth as well. Skyrocketing inflation keeps the central banks busy.

Analysts: Major downward revision of 2023 growth

Katarzyna Rzentarzewska
katarzyna.rzentarzewska@erstegroup.com Economic growth in the first half of the year was stronger than expected in
many countries, as domestic demand (especially household consumption)
Katarína Gumanová remained resilient to the high inflation and interest rate environment. As a
katarina.gumanova@erstegroup.com
consequence, we adjust upwards our 2022 growth forecast for Croatia,
Juraj Kotian Czechia, Romania, Serbia and Slovenia. In Hungary, Poland and Slovakia, on
juraj.kotian@erstegroup.com the other hand, growth will be slightly weaker than initially expected. A strong
carryover effect will keep the annual growth rates in positive territory, despite
growing concerns that part of the region will likely face technical recession
(two consecutive quarters with negative growth rates) in the second half of the
year. Poland and Czechia will be a notable exception, as negative y/y growth
at the turn of the year has become our baseline scenario.
Macro Outlooks:
Czechia
Croatia Recent economic developments (weakening external environment, market
Hungary sentiment pointing to contraction in the industry sector, plummeting consumer
Poland confidence to levels last seen during the 2012 recession) forced a major
Romania
Slovakia
downward revision of 2023 GDP growth forecasts across the region, with the
Slovenia CEE8 average growth dropping to 1.3% next year, from the previously
Serbia expected 3%. Distress over the gas supply during the coming winter only adds
to the already high level of uncertainty and concern. Although the level of gas
storage seems reassuring at this point, the price for energy security is high;
there are non-negligible risks of a stagflation scenario in Europe.

2023 GDP growth revised visibly down

Size of revision (percentage point) and GDP growth rates (percent)

CEE Macro & FI Research

Juraj Kotian (Head)

Katarzyna Rzentarzewska
(Chief CEE Macro Analyst)
Katarina Gumanova
(CEE Macro Analyst)
Source: Erste Group Research

Note: Past performance is not necessarily

indicative of future results.
CEE: Croatia, Czechia, Hungary, Poland,
Romania, Slovenia, Slovakia, Serbia
CEE Macro & FI Research
Skyrocketing inflation, with its risks of wider second-round effects and
concerns around de-anchored inflation expectations, have led local central
banks to tighten their monetary stances at a brisk pace. Yet, they are now
walking a finer line, as the attempt to tame soaring inflation needs to be
Page 1

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

weighed against an expected slowdown in economic activity in the quarters

ahead. It seems that monetary tightening has come to an end in Czechia
and Poland. In Romania, tightening will likely continue at a reduced speed,
while in Hungary and Serbia, the central banks stepped up the pace of
interest rate increases. On top of that, the Hungarian central bank decided
to introduce additional measures in order to reduce interbank liquidity and
increase the effectiveness of its transmission mechanism.

Down, down, down, down…

The first half of the year delivered many positive surprises in terms of
economic performance. In Slovenia, GDP growth was above 9% and 8% in
the first and second quarters, respectively. Resilient domestic demand and
strong tourism are paving the way for another strong year in Croatia, with
the economy expanding by 7.4% y/y in the first half of the year. The
Hungarian economy grew at a very similar pace to that of Croatia. Romania
delivered whopping 5.8% y/y growth in the first two quarters. Furthermore, in
Czechia, Slovakia and Serbia, growth remained surprisingly strong. Only
Poland mostly stagnated in the first half of the year, as the dynamic growth
from the beginning of the year (2.5% q/q in 1Q22), driven by inventory
buildup, was practically wiped out in the second quarter (-2.1% q/q).

Downward revision of growth in EZ and Germany PMI vs. GDP growth in Czechia and Poland
(percent) (points, percent)

Source: Erste Group Research Source: S&P Global, Erste Group Research

The outlook is not that rosy, however. First and foremost, the external
environment has been weakening, with next year’s growth expectations
falling visibly. The ECB slashed the 2023 growth forecast for the Eurozone
to 0.9%. Apart from the ECB, we saw three German institutes revising their
forecasts for the German economy downwards. In particular, the IfW
institute in Kiel and Halle's IWH predict contraction in 2023 at magnitudes of
-0.7% and -1.4%, respectively, a U-turn from June forecasts that predicted
growth of 3.3% and 2.0%, respectively. Worsening outlook of the external
environment means deteriorating growth prospects for the region with
technical recession at the turn of 2022/2023 increasingly likely

CEE Macro & FI Research Page 2

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

Furthermore, sentiment indicators keep deteriorating:

• The PMI indices in Czechia and Poland1 are below the threshold of
50. Poland had the lowest manufacturing PMI output index and the
second-lowest score in terms of new export orders in August.
Czechia holds the third-lowest score as far as new exports orders
are concerned. Moreover, the correlation between PMI and GDP
growth unequivocally indicates an upcoming contraction.
• The Economic Sentiment Indicator is in a downward trend and has
been well below the long-term average in CEE for a couple of
months already.
• Consumer confidence plummeted and is as low as when the
pandemic first spread and close to the levels seen during the 2012
recession.
• The evaluation of the financial situation of households is also quite
pessimistic. During the pandemic, government programs helped
households to restore optimism relatively quickly; surging inflation
and costs of living are the major source of concern at the moment.

Sentiment indicators Gas storage has been building up

(points, CEE6 average*) (percent of working gas volume in storage, 2022)

Source: *without Romania and Serbia, EC, Erste Group Research Source: AGSI, Erste Group Research

Winter is coming

Distress over the gas supply during the coming winter only adds to the
already high level of uncertainty and concern. Although the level of gas
storage seems reassuring at this point (storage facilities at least 80% full,
with volume covering between 15% and 40% of annual consumption), the
price for energy security is high; there are non-negligible risks of a
stagflation scenario in Europe. Gas prices have skyrocketed as a
consequence of the combination of a few factors - gas shortages, increased
demand driven by storage buildup, as well as low liquidity on the gas and
power market. Furthermore, the search for substitutes made the prices of
other energy sources (such as coal) go up. Households and businesses will
feel the full impact of increasing costs of energy only in the quarters to
come.

1 We do not refer to the Hungarian PMI Index, due to differing methodology

CEE Macro & FI Research Page 3

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

Fading strength of domestic demand

The growth of private consumption and investment has slowed across the
region. The exceptions are Croatia and Romania, where private
consumption growth accelerated slightly in the second quarter. In the case
of investments, the growth was stronger compared to the beginning of the
year in Poland, Romania and Serbia.

Private consumption suffered the most in Czechia (growth dynamics

dropped from 8.0% y/y in 1Q to a meager 0.2% y/y in 2Q), reflecting
households’ pessimism about the current and future situations. Monetary
tightening and surging inflation, which have pushed the growth of real
wages into negative territory, are yet to take a toll in other countries, as we
expect private consumption growth to drop visibly in the second half of the
year and in 2023.

Private consumption to slow Negative growth of real wages

(HH consumption, % y/y seasonally-adjusted) (percent)

Source: Eurostat, Erste Group Research Source: Eurostat, Erste Group Research

First signs of deterioration on labor market

So far, the labor market has not shown any major deterioration, as CEE
economies began to slow in the second quarter. Actually, the number of
employed people went up in each of the countries in the region except for
Czechia (50tsd fewer employed in 2Q) and Slovakia (1tsd fewer employed
in 2Q), according to the latest Eurostat data. The unemployment rates show
the first signs of worsening in some of the CEE countries, however. In
Hungary and Croatia, the unemployment rate increased in July, while in
Poland and Slovakia, the unemployment rate remained flat. Furthermore,
the number of job vacancies went down in the second quarter in Czechia,
Croatia and Romania.

All in all, the labor market has never been so tight in the region, as:
• the unemployment rate is at very low levels
• labor market slack has been dropping
• the vacancy rate has been growing

CEE Macro & FI Research Page 4

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

In short, the unemployment rate is not expected to increase visibly, despite

recession fears.

Unemployment rate has been dropping Surging electricity and gas prices
(percent) (percent)

Source: Eurostat, Erste Group Research Source: Eurostat, Erste Group Research

Costs of housing to skyrocket without intervention

The inflation rate in August continued to increase in most of the CEE

countries. So far, there have been two exceptions: Czechia and Slovenia. In
Czechia, the annual rate of inflation slowed down to 17.2%, from 17.5% in
July, while in Slovenia, the annual rate of inflation remained at 11% in
August. In Czechia, the lower-than-expected rise of food prices helped the
headline number; however, it seems that pro-inflationary effects stemming
from domestic factors have weakened as well. In other countries headline
CPI went up further, with the most pronounced increase of almost 2
percentage points in Hungary. Compared to the beginning of the year, the
inflation rate is up 5 percentage points in Serbia and as much as 7
percentage points or more in Romania, Czechia and Hungary.

The peak of inflation is still ahead in many CEE countries, however, as costs
of housing are expected to rise substantially, with higher electricity prices
fully reaching households and businesses only over the coming months.

In the meantime, the Croatian government announced an HRK 21bn (4.2%

of GDP) heavy anti-inflation package. The most important measures include
a freezing of household electricity prices, preferential treatment for the
public sector and limits being imposed as far as the corporate sector is
concerned. In Czechia, the government approved caps on electricity and
gas prices. Poland should prolong the anti-inflationary shield in 2023 and
most recently it offered subsidies for heating commodities.

Although the anti-inflationary programs protect the most vulnerable, they

remain pro-inflationary in their nature, wiping off some of the effects of
monetary tightening.

CEE Macro & FI Research Page 5

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

External factors cannot be entirely blamed for inflation

Disruptions in global supply chains have eased visibly, as evidenced by the

dropping of the Global Supply Chain Pressure Index. Furthermore, not only
does the cost of shipping seem to have gone down, but the shipping time.

Headline CPI and core inflation Oil price development

(percent, m/m change) (USD/bbl, percent)

Source: Eurostat, Erste Group Research Source: Bloomberg, Erste Group Research

has also been reduced. We thus expect the producer price pressure to go
down in coming months following the turn of the intermediate goods PPI
Index. Furthermore, food and oil prices have also eased to the level that, if
kept constant, would warrant a negative contribution to the inflation numbers
next year.

Although external factors favor easing inflationary pressure, headline CPI

will remain elevated next year and well above the central bank’s target, as
underlying demand pressure is high as evidenced by constantly increasing
core inflation.

Inflation forecast More tightening to come in CEE (apart from CZ)

percent Key rate, percent

Source: Euostat, Erste Group Research Source: Bloomberg, Erste Group Research

CEE Macro & FI Research Page 6

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

Tightening peaks are still ahead of us in most of CEE

Skyrocketing inflation, with its risks of wider second-round effects and

concerns around de-anchored inflation expectations, have led local central
banks to tighten their monetary stances at a brisk pace. Yet, they are now
walking a finer line, as the attempt to tame soaring inflation needs to be
weighed against an expected slowdown in economic activity in the quarters
ahead.

Whereas the Czech central bank seems to have reached the peak of its
tightening cycle at 7%, and the upcoming economic slowdown and easing
inflationary pressures may open the room for a cut in February 2023 (with a
risk of an earlier, November cut), other central banks are likely to continue
hiking rates in the near term. In Hungary, the key rate and one-week deposit
rate were merged in June and have moved in tandem ever since,
eliminating the duality of the interest rate system. Currently, the key rate
stands at a whopping 11.75%, and we expect it to rise to 13.75% by the end
of 1Q23. Apart from interest rate increases, the MNB decided to introduce
additional measures to reduce interbank liquidity and increase the
effectiveness of its transmission mechanism.

The outlook for rates is different in Poland. Despite surging inflation, the
tightening cycle is coming to an end, and we expect the key rate to sit at 7%
by year-end – up 25bp from its current stance. The NBP will likely turn a
blind eye to inflation increases at the beginning of next year, excusing itself
with the external character of inflation. Governor Glapinski has even
indicated monetary easing at the end of 2023, though we doubt that, due to
the likely persistence of inflation.

In Romania, the NBR turned dovish in August, in line with our expectations,
as it hiked by ‘only’ 75bp vs. the 100bp expected by the market consensus.
It is likely that tightening will continue at a more reduced speed. We expect
two more rate hikes, altogether by 75bp, by year-end, which would bring the
key rate up to 6.25%. The credit facility rate, as the relevant operational
instrument under firm liquidity management, would thus peak at 7.25%. In
Serbia, the NBS stepped up the pace and delivered a 50bp increase in
September. We expect another 100bp in hikes by year-end, with more to
come in 1Q23.

Even the ECB jumped on the rate-hiking bandwagon in July. At the

September meeting, it opted for a large rate hike of 75bp in order to move
quickly to a higher interest rate level. As inflation will not slow down for the
time being, the ECB should continue on this path. At its next meeting, we
therefore expect a further rate hike of 75bp. Subsequent steps in December
and February should be significantly smaller and only amount to 25bp each.

Global developments remain key for local FX

Volatility has been the name of the game for free-floating CEE currencies in
3Q22 as well. Although the movements were not as pronounced as earlier
in the year when the war in Ukraine broke out, the forint and zloty have
weakened by around 14% and 4% compared to the end of June,
respectively. On the other hand, the koruna and leu have seen mild
appreciation – though both have benefitted from central bank interventions,
especially the former. In fact, thanks to CNB interventions, the Czech

CEE Macro & FI Research Page 7

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

koruna remains anchored close to 24.50 vs. the EUR and is unlikely to
diverge from that level anytime soon. The central bank has ample firepower
for interventions, courtesy of the large FX reserves it amassed during the
intervention-floor policy several years ago.

CEE currencies remain volatile Development since war in Ukraine started

Index of CEE currencies (February 1 = 100) (% change, + shows depreciation, - appreciation)

Source: Bloomberg, Erste Group Research Source: Bloomberg, Erste Group Research

The Hungarian forint has been on a weakening streak this year, with brief
periods of respite. Nonetheless, it remains the region’s most battered
currency, as it weakened by a whopping 14% compared to late February.
The sizeable tightening of the local central bank has done little to soothe the
pressure on the forint. The underlying weakness of the Hungarian currency
is predominantly due to the dispute with the EU over rule of law issues and
the threat of cuts or freezes of EU funds, as well as the high dependence of
the country on Russian gas. The widening trade deficit is not helping, either.

Although the zloty has been hit less than the forint, it also remains on a
weaker footing, due to global factors, such as tightening on both sides of the
Atlantic (US, Eurozone) and the stronger US dollar. On top of that, local
factors are also at play. Even though the country reached an agreement
with the EU on unlocking its Recovery and Resilience Facility in June, we
have yet to see the funds start flowing into the economy, as several legal
hurdles remain in place. Moreover, the central bank seems to be nearly
done with its tightening, despite the still soaring inflation. In Romania, the
central bank retains its tight grip on the currency, as it cannot afford a
weaker leu. Even though the RON appreciated somewhat in late August, on
favorable flows into the currency, post-wheat harvest exports and seasonal
remittances from abroad, it reversed course later on and is back to 4.93 vs.
the EUR.

Going forward, external developments will likely dominate and weigh on

CEE currencies in the near term. However, as these subside, the
fundamentals point to a gradual appreciation of most of them. We remain
skeptical on the zloty’s near-term appreciation potential, due to the
unresolved issue with Recovery and Resilience Funds and the possibility
that the NBP may end its hiking cycle prematurely. We thus see it close to

CEE Macro & FI Research Page 8

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

4.68-4.70 during the rest of the year. In the forint’s case, clear positive signs
from the talks with the EC and easing of tensions on energy markets are
needed to mitigate the pressure on the currency. We expect the EURHUF
pair at 390 by year-end. The Czech koruna will likely stay close to 24.50 this
year, with some appreciation potential later on in 2023. On the other hand,
the Romanian leu is likely to weaken towards 5.00 vs. the EUR by late
December.

The Croatian kuna is in its last few weeks as the country’s currency. As of
January 1, 2023, Croatia will become the 20th member of the Euro Area,
with the conversion rate set at 7.5345 against the euro. Meanwhile, the EU’s
single currency has recently been consistently trading very close to parity
against the US dollar. Signals from both the ECB and the Fed point to
further significant interest rate hikes. In addition, gas storage facilities in
Europe are filling up quickly, which means that the risks of energy shortages
are steadily decreasing. We thus see the euro strengthening towards 1.05
vs. the USD by year-end.

Bond market

Although government bond yields on major markets continued to head north

during the summer, on rising expectations of earlier and bolder actions
needed from both the FED and ECB, yields on LCY bonds corrected in all
CEE countries except for Hungary. The main reason behind the correction
was that the bulk of monetary tightening had already been completed in
CEE, while downward risks to the growth outlook and the appearance of the
first cracks in domestic demand started to weigh on considerations of
whether further tightening is needed at all. As a result, yields declined and
the spread on 10Y government bonds in Czechia, Poland and Romania vs.
German Bunds have compressed by 70-130bp since the end of June.
Hungarian bonds have moved in the opposite direction, as the central bank
had to hike rates to double-digit territory in order to support the HUF, which
has lost more than 10% vs. the EUR since the beginning of the year. Given
the uncertainty about future EU fund payments, we see that the Hungarian
government has to pay an extremely high premium to lure investors these
days. With HUF 5Y5Y IRS above 7%, we see potential value and space for
a correction in yields on 10Y HGBs (about -100bp by the end of 1Q23)
currently traded with a yield to maturity above 9%.

10Y government bond yields 5Yx5Y interest rate swaps

percent percent

Source: Bloomberg, Erste Group Research Source: Bloomberg Erste Group Research
CEE Macro & FI Research Page 9

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

Forecasts
Government bond yields
current 2022Q4 2023Q1 2023Q2 2023Q3
Croatia 10Y 3.2 3.5 3.5 3.5 3.4
spread (bps) 144 224 224 216 211
Czechia 10Y 4.5 4.4 4.2 3.9 3.7 FX
spread (bps) 276 311 290 255 238 current 2022Q4 2023Q1 2023Q2 2023Q3
Hungary 10Y 9.3 8.2 8.1 7.3 6.9 EURHRK 7.53 7.53 7.53 7.53 7.53
spread (bps) 752 692 682 601 565
Poland 10Y 6.0 6.0 6.1 5.9 5.8 EURCZK 24.52 24.50 24.36 24.29 24.21
spread (bps) 429 474 484 456 451
Romania10Y 8.1 8.5 8.3 8.0 7.8 EURHUF 407.72 390.00 385.00 380.00 380.00
spread (bps) 636 724 699 666 646
Slovakia 10Y 2.8 3.2 3.3 3.4 3.5 EURPLN 4.73 4.68 4.70 4.66 4.65
spread (bps) 102 194 204 206 221
Slovenia 10Y 2.76 2.70 2.80 2.80 2.80 EURRON 4.92 5.00 5.02 5.05 5.07
spread (bps) 102 144 154 146 151
Serbia 5Y 6.4 6.8 6.9 6.6 6.5 EURRSD 117.30 117.60 117.60 117.60 117.60
spread (bps) 469 554 564 526 521
DE10Y* 1.74 1.26 1.26 1.34 1.29 EURUSD 1.00 1.05 1.10 1.10 1.13
* Spreads based on Bloomberg consensus forecast

3M Money Market Rate Key Interest Rate

current 2022Q4 2023Q1 2023Q2 2023Q3 current 2022Q4 2023Q1 2023Q2 2023Q3
Croatia 0.05 0.05 0.05 0.05 0.05
Czechia 7.24 7.07 6.04 5.27 4.51 Czechia 7.00 7.00 6.00 5.25 4.50
Hungary 12.90 13.95 13.95 10.95 9.95 Hungary 11.75 13.75 13.75 10.75 9.75
Poland 7.15 7.15 7.15 7.15 7.05 Poland 6.75 7.00 7.00 7.00 7.00
Romania 7.90 8.84 8.04 7.54 7.04 Romania 5.50 6.25 6.25 6.25 6.25
Serbia 3.33 4.32 4.89 4.89 4.89 Serbia 3.50 4.50 5.00 5.00 5.00
Eurozone 1.03 1.97 1.97 1.97 1.97 Eurozone 1.25 2.25 2.25 2.25 2.25

Real GDP growth (%) Average inflation (%) Unemployment (%)

2020 2021 2022f 2023f 2020 2021 2022f 2023f 2020 2021 2022f 2023f
Croatia -8.1 10.2 5.5 2.1 Croatia 0.1 2.6 10.5 6.5 Croatia 7.5 7.6 6.3 5.9
Czechia -5.5 3.5 2.3 0.9 Czechia 3.2 3.8 15.8 7.0 Czechia 2.6 2.9 2.6 3.3
Hungary -4.7 7.1 5.0 0.9 Hungary 3.3 5.1 14.3 13.3 Hungary 4.1 4.1 3.5 3.7
Poland -2.2 5.9 3.9 0.7 Poland 3.4 5.1 13.9 10.2 Poland 5.9 5.9 5.1 5.5
Romania -3.7 5.9 6.0 2.7 Romania 2.7 5.0 13.4 10.2 Romania 6.0 5.6 5.6 5.8
Serbia -0.9 7.4 3.5 3.0 Serbia 1.6 4.0 11.4 8.6 Serbia 9.7 11.0 9.5 9.0
Slovakia -4.4 3.0 1.8 1.5 Slovakia 1.9 3.2 12.2 9.5 Slovakia 6.7 6.8 6.3 6.5
Slovenia -4.2 8.1 5.8 1.7 Slovenia 0.0 1.9 9.3 5.5 Slovenia 5.0 4.8 4.3 4.1
CEE8 avg -3.7 5.7 4.1 1.3 CEE8 avg 2.8 4.5 13.7 9.6 CEE8 avg 5.4 5.4 4.9 5.2

Public debt (% of GDP) C/A (%GDP) Budget Balance (%GDP)

2020 2021 2022f 2023f 2020 2021 2022f 2023f 2020 2021 2022f 2023f
Croatia 87.3 79.8 71.0 68.0 Croatia -0.1 3.4 1.5 0.4 Croatia -7.4 -2.9 -2.5 -2.5
Czechia 37.6 42.0 43.3 44.0 Czechia 2.0 -0.8 -2.8 0.3 Czechia -5.8 -5.9 -4.7 -3.7
Hungary 79.6 76.8 73.8 71.4 Hungary -1.1 -3.2 -8.4 -4.9 Hungary -7.8 -6.8 -4.9 -3.5
Poland 57.1 53.8 52.5 51.9 Poland 2.9 -0.6 -1.3 -0.3 Poland -6.9 -1.9 -4.5 -4.4
Romania 47.2 48.8 48.3 49.1 Romania -5.0 -7.0 -9.3 -7.5 Romania -9.3 -7.1 -6.2 -4.4
Serbia 57.0 56.5 54.4 53.3 Serbia -4.1 -4.4 -9.1 -9.1 Serbia -8.0 -4.1 -3.5 -3.0
Slovakia 59.7 63.1 62.4 62.0 Slovakia 0.1 -2.0 -3.2 -2.0 Slovakia -5.5 -6.2 -5.5 -4.0
Slovenia 79.8 74.7 70.7 69.1 Slovenia 7.6 3.8 1.4 2.0 Slovenia -7.8 -5.2 -4.0 -3.0
CEE8 avg 56.9 55.9 54.7 54.0 CEE8 avg 0.7 -1.9 -3.8 -2.2 CEE8 avg -7.2 -4.4 -4.8 -4.0

Source: Bloomberg (prices as of September 15th), Erste Group Research

CEE Macro & FI Research Page 10

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

Appendix

Source: Bloomberg, Erste Group Research

CEE Macro & FI Research Page 11

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

Group Research
Head of Group Research Fixed Income Institutional Sales
Friedrich Mostböck, CEFA® +43 (0)5 0100 11902
Group Securities Markets
CEE Macro/Fixed Income Research Head: Thomas Einramhof +43 (0)50100 84432
Head: Juraj Kotian (Macro/FI) +43 (0)5 0100 17357
Katarzyna Rzentarzewska (Fixed income) +43 (0)5 0100 17356 Institutional Distribution Core
Malgorzata Krzywicka (Fixed income, Poland) +43 (0)5 0100 17338 Head: Jürgen Niemeier +49 (0)30 8105800 5503
Katarina Gumanova +43 (0)5 0100 17336
Institutional Distribution DACH+
Croatia/Serbia Head: Marc Friebertshäuser +49 (0)711 810400 5540
Alen Kovac (Head) +385 72 37 1383 Bernd Bollhof +49 (0)30 8105800 5525
Mate Jelić +385 72 37 1443 Andreas Goll +49 (0)711 810400 5561
Ivana Rogic +385 72 37 2419 Mathias Gindele +49 (0)711 810400 5562
Ulrich Inhofner +43 (0)5 0100 85544
Czech Republic Sven Kienzle +49 (0)711 810400 5541
David Navratil (Head) +420 956 765 439 Rene Klasen +49 (0)30 8105800 5521
Jiri Polansky +420 956 765 192 Christopher Lampe-Traupe +49 (0)30 8105800 5523
Michal Skorepa +420 956 765 172 Karin Rattay +43 (0)5 0100 84118
Michael Schmotz +43 (0)5 0100 85542
Hungary Klaus Vosseler +49 (0)711 810400 5560
Orsolya Nyeste +361 268 4428 Slovakia
János Nagy +361 272 5115 Šarlota Šipulová +421 2 4862 5619
Monika Směliková +421 2 4862 5629
Romania
Ciprian Dascalu (Head) +40 3735 10108 Institutional Distribution CEE & Insti AM CZ
Eugen Sinca +40 3735 10435 Head: Antun Burić +385 (0)7237 2439
Dorina Ilasco +40 3735 10436 Jaromir Malak +43 (0)5 0100 84254
Vlad Nicolae Ionita +40 7867 15618
Czech Republic
Slovakia Head: Ondrej Čech +420 2 2499 5577
Maria Valachyova (Head) +421 2 4862 4185 Milan Bartoš +420 2 2499 5562
Matej Hornak +421 902 213 591 Jan Porvich +420 2 2499 5566

Major Markets & Credit Research Institutional Asset Management Czech Republic
Head: Gudrun Egger, CEFA® +43 (0)5 0100 11909 Head: Petr Holeček +420 956 765 453
Ralf Burchert, CEFA® (Sub-Sovereigns & Agencies) +43 (0)5 0100 16314 Petra Maděrová +420 956 765 178
Hans Engel (Global Equities) +43 (0)5 0100 19835 Martin Peřina +420 956 765 106
Margarita Grushanina (Austria, Quant Analyst) +43 (0)5 0100 11957 David Petráček +420 956 765 809
Peter Kaufmann, CFA® (Corporate Bonds) +43 (0)5 0100 11183 Blanka Weinerová +420 956 765 317
Heiko Langer (Financials & Covered Bonds) +43 (0)5 0100 85509 Petr Valenta +420 956 765 140
Stephan Lingnau (Global Equities) +43 (0)5 0100 16574 Croatia
Carmen Riefler-Kowarsch (Financials & Covered Bonds) +43 (0)5 0100 19632 Head: Antun Burić +385 (0)7237 2439
Rainer Singer (Euro, US) +43 (0)5 0100 17331 Zvonimir Tukač +385 (0)7237 1787
Bernadett Povazsai-Römhild, CEFA® (Corporate Bonds) +43 (0)5 0100 17203 Natalija Zujic +385 (0)7237 1638
Elena Statelov, CIIA® (Corporate Bonds) +43 (0)5 0100 19641 Hungary
Gerald Walek, CFA® (Euro, CHF) +43 (0)5 0100 16360 Head: Peter Csizmadia +36 1 237 8211
Gábor Bálint +36 1 237 8205
CEE Equity Research Ádám Szönyi +36 1 237 8213
Head: Henning Eßkuchen +43 (0)5 0100 19634 Romania and Bulgaria
Daniel Lion, CIIA® (Technology, Ind. Goods&Services) +43 (0)5 0100 17420 Head: Ruxandra Lungu +40 373516562
Michael Marschallinger, CFA® +43 (0)5 0100 17906
Nora Nagy (Telecom) +43 (0)5 0100 17416 Group Institutional Equity Sales
Christoph Schultes, MBA, CIIA® (Real Estate) +43 (0)5 0100 11523 Head: Brigitte Zeitlberger-Schmid +43 (0)50100 83123
Thomas Unger, CFA® (Banks, Insurance) +43 (0)5 0100 17344 Werner Fürst +43 (0)50100 83121
Vladimira Urbankova, MBA (Pharma) +43 (0)5 0100 17343 Josef Kerekes +43 (0)50100 83125
Martina Valenta, MBA +43 (0)5 0100 11913 Cormac Lyden +43 (0)50100 83120
Czech Republic
Croatia/Serbia Head: Michal Řízek +420 224 995 537
Mladen Dodig (Head) +381 11 22 09178 Jiří Fereš +420 224 995 554
Anto Augustinovic +385 72 37 2833 Martin Havlan +420 224 995 551
Magdalena Basic +385 72 37 1407 Pavel Krabička +420 224 995 411
Davor Spoljar, CFA® +385 72 37 2825 Poland
Head: Jacek Jakub Langer +48 22 257 5711
Czech Republic Tomasz Galanciak +48 22 257 5715
Petr Bartek (Head) +420 956 765 227 Wojciech Wysocki +48 22 257 5714
Jan Safranek +420 956 765 218 Przemyslaw Nowosad +48 22 257 5712
Grzegorz Stepien +48 22 257 5713
Hungary Croatia
József Miró (Head) +361 235 5131 Matija Tkalicanac +385 72 37 21 14
András Nagy +361 235 5132 Hungary
Tamás Pletser, CFA® +361 235 5135 Nandori Levente + 36 1 23 55 141
Krisztian Kandik + 36 1 23 55 162
Poland Balasz Zankay + 36 1 23 55 156
Cezary Bernatek (Head) +48 22 257 5751 Romania
Piotr Bogusz +48 22 257 5755 Liviu Avram +40 3735 16569
Łukasz Jańczak +48 22 257 5754
Krzysztof Kawa +48 22 257 5752 Group Fixed Income Securities Markets
Jakub Szkopek +48 22 257 5753 Head: Goran Hoblaj +43 (0)50100 84403

Romania FISM Flow

Caius Rapanu +40 3735 10441 Head: Aleksandar Doric +43 (0)5 0100 87487
Margit Hraschek +43 (0)5 0100 84117
Christian Kienesberger +43 (0)5 0100 84323
Group Markets Ciprian Mitu +43 (0)5 0100 85612
Bernd Thaler +43 (0)5 0100 84119
Head of Group Markets Zsuzsanna Toth +36-1-237 8209
Oswald Huber +43 (0)5 0100 84901 Poland:
Pawel Kielek +48 22 538 6223
Group Markets Retail and Agency Business
Head: Christian Reiss +43 (0)5 0100 84012 Michal Jarmakowicz +43 50100 85611
Markets Retail Sales AT Group Fixed Income Securities Trading
Head: Markus Kaller +43 (0)5 0100 84239 Head: Goran Hoblaj +43 (0)50100 84403
Group Markets Execution Group Equity Trading & Structuring
Head: Kurt Gerhold +43 (0)5 0100 84232 Head: Ronald Nemec +43 (0)50100 83011
Retail & Sparkassen Sales Business Support
Head: Uwe Kolar +43 (0)5 0100 83214 Bettina Mahoric +43 (0)50100 86441
Corporate Treasury Product Distribution AT
Head: Christian Skopek +43 (0)5 0100 84146

CEE Macro & FI Research Page 12

For the exclusive use of Erste Group Client. (Erste Group)

Erste Group Research
What’s up in CEE? | CEE | Economy
15. September 2022

Disclaimer
This publication was prepared by Erste Group Bank AG or any of its consolidated subsidiaries (together with consolidated
subsidiaries "Erste Group") independently and objectively as other information pursuant to the Circular of the Austrian Financial
Market Authority regarding information including marketing communication pursuant to the Austrian Securities Supervision Act.
This publication serves interested investors as additional source of information and provides general information, information
about product features or macroeconomic information without emphasizing product selling marketing statements. This
publication does not constitute marketing communication pursuant to Art. 36 (2) Austrian Securities Supervision Act as no direct
buying incentives were included in this publication, which is of information character. This publication does not constitute
investment research pursuant to § 36 (1) Austrian Securities Supervision Act. It has not been prepared in accordance with legal
requirements designed to promote the independence of investment research and it is not subject to the prohibition on dealing
ahead of the dissemination of investment research. The information only serves as non-binding and additional information and is
based on the level of knowledge of the person in charge of drawing up the information on the respective date of its preparation.
The content of the publication can be changed at any time without notice. This publication does not constitute or form part of,
and should not be construed as, an offer, recommendation or invitation to subscribe for or purchase any securities, and neither
this publication nor anything contained herein shall form the basis of or be relied on in connection with or act as an inducement
to enter into any contract or inclusion of a security or financial product in a trading strategy. Information provided in this
publication are based on publicly available sources which Erste Group considers as reliable, however, without verifying any such
information by independent third persons. While all reasonable care has been taken to ensure that the facts stated herein are
accurate and that the forecasts, opinions and expectations contained herein are fair and reasonable, Erste Group (including its
representatives and employees) neither expressly nor tacitly makes any guarantee as to or assumes any liability for the up-to-
dateness, completeness and correctness of the content of this publication. Erste Group may provide hyperlinks to websites of
entities mentioned in this document, however the inclusion of a link does not imply that Erste Group endorses, recommends or
approves any material on the linked page or accessible from it. Neither a company of Erste Group nor any of its respective
managing directors, supervisory board members, executive board members, directors, officers of other employees shall be in
any way liable for any costs, losses or damages (including subsequent damages, indirect damages and loss of profit) howsoever
arising from the use of or reliance on this publication. Any opinion, estimate or projection expressed in this publication reflects
the current judgment of the author(s) on the date of publication of this document and do not necessarily reflect the opinions of
Erste Group. They are subject to change without prior notice. Erste Group has no obligation to update, modify or amend this
publication or to otherwise notify a reader thereof in the event that any matter stated herein, or any opinion, projection, forecast
or estimate set forth herein, changes or subsequently becomes inaccurate. The past performance of securities or financial
instruments is not indicative for future results. No assurance can be given that any financial instrument or issuer described
herein would yield favorable investment results or that particular price levels may be reached. Forecasts in this publication are
based on assumptions which are supported by objective data. However, the used forecasts are not indicative for future
performance of securities or financial instrument. Erste Group, its affiliates, principals or employees may have a long or short
position or may transact in the financial instrument(s) referred to herein or may trade in such financial instruments with other
customers on a principal basis. Erste Group may act as a market maker in the financial instruments or companies discussed
herein and may also perform or seek to perform investment services for those companies. Erste Group may act upon or use the
information or conclusion contained in this publication before it is distributed to other persons. This publication is subject to the
copyright of Erste Group and may not be copied, distributed or partially or in total provided or transmitted to unauthorized
recipients. By accepting this publication, a recipient hereof agrees to be bound by the foregoing limitations. This document is
only made to or directed at investment professionals (as that term is defined in Article 19(5) of the Financial Services and
Markets Act 2000 (Financial promotion) Order 2005 (“FPO”)) or to persons for whom it would otherwise be lawful to distribute it.
Accordingly, persons who do not have professional experience in matters relating to investments should not rely on this
document.

© Erste Group Bank AG 2022. All rights reserved.

Published by:

Erste Group Bank AG

Group Research
1100 Vienna, Austria, Am Belvedere 1
Head Office: Wien
Commercial Register No: FN 33209m
Commercial Court of Vienna

Erste Group Homepage: www.erstegroup.com

CEE Macro & FI Research Page 13

For the exclusive use of Erste Group Client. (Erste Group)