Central & Eastern Europe Economic Outlook
Our panelists expect CEE’s GDP growth to exceed 2024’s level in 2025 as interest rate cuts and stronger EU demand should support fixed investment, industrial production and exports. That said, private and public spending growth will likely wane in most CEE countries. Weaker-than-expected EU demand is a downside risk, while EU funds absorption is key to watch.
Central & Eastern Europe Inflation
In June, regional inflation rose from May’s level, marking the second consecutive increase, but remaining around the past-decade average. Our panelists forecast average inflation in CEE to exceed 2024’s level in 2025 as a whole due to stronger GDP growth and interest rate cuts. Commodity price spikes are an upside risk.
This chart displays Economic Growth (Real GDP, ann. var. %) for Central & Eastern Europe from 2010 to 2024.
| 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|
| Economic Growth (Real GDP, ann. var. %) | -3.3 | 6.5 | 4.1 | 0.8 | 1.9 |
| Private Consumption (annual variation in %) | -3.5 | 6.4 | 4.3 | -0.3 | 3.6 |
| Investment (annual variation in %) | -2.6 | 3.6 | 3.5 | 8.1 | -2.2 |
| Industrial Production (ann. var. %) | -4.6 | 11.0 | 5.5 | -2.4 | -0.6 |
| Unemployment (% of active population, aop) | 5.8 | 5.3 | 4.8 | 4.8 | 4.8 |
| Fiscal Balance (% of GDP) | -6.8 | -4.1 | -3.7 | -4.7 | -5.3 |
| Public Debt (% of GDP) | 53.5 | 52.3 | 49.7 | 49.7 | 53.1 |
| Inflation (CPI, ann. var. %, aop) | 2.6 | 4.4 | 14.3 | 11.2 | 3.5 |
| Policy Interest Rate (%, eop) | 0.26 | 1.65 | 6.38 | 6.24 | 5.12 |