Central & Eastern Europe Economic Outlook
CEE’s GDP growth will strengthen from 2024’s forecast in 2025 on a surge in investment, industrial output and exports. However, household spending will decelerate, capped by still-high inflation, interest and unemployment rates. Prolonged weakness in EU demand due to higher U.S. tariffs under Trump and heavier-than-expected fallout from Storm Boris are downside risks.
Central & Eastern Europe Inflation
In October, regional inflation hit a nine-month high as price pressures intensified across CEE. Our panelists see 2025’s inflation near 2024’s projection as lower interest rates broadly offset lower global energy and food prices. Higher U.S. tariffs, unexpected currency depreciation and supply-chain shocks due to Storm Boris are upside risks.
This chart displays Economic Growth (Real GDP, ann. var. %) for Central & Eastern Europe from 2010 to 2023.
| 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|
| Economic Growth (Real GDP, ann. var. %) | 4.0 | -3.3 | 6.5 | 4.1 | 0.7 |
| 3.5 | -3.5 | 6.4 | 4.3 | -0.3 | |
| 8.8 | -3.3 | 3.8 | 3.2 | 9.0 | |
| Industrial Production (ann. var. %) | 1.6 | -4.6 | 11.0 | 5.6 | -2.5 |
| Unemployment (% of active population, aop) | 4.6 | 5.8 | 5.3 | 4.8 | 4.8 |
| Fiscal Balance (% of GDP) | -1.0 | -6.8 | -4.1 | -3.7 | -4.7 |
| Public Debt (% of GDP) | 43.0 | 53.7 | 52.5 | 49.8 | 49.8 |
| Inflation (CPI, ann. var. %, aop) | 2.7 | 2.6 | 4.4 | 14.3 | 11.2 |
| Policy Interest Rate (%, eop) | 1.25 | 0.26 | 1.65 | 6.38 | 6.24 |