Outlook for Central and Eastern Europe 09/2010

Czech Republic
According to the first estimate the Czech economy grew by 2.1% in the second quarter. The industry as well as exports
recorded strong growth, while domestic demand remained subdued. Inflation is closer to the target of the CNB but the
central bank may not rush to raise its rates.

Hungary
Macro data in August confirmed the consensus view about a gradual recovery amid improving external balance and low
inflation. The next key event could be the 2011 budget proposal due early October, which may show the new directions of
fiscal policy.

Poland
Polish consumption and domestic investments surprised on the upside in the second quarter. It is pretty comfortable to
see that domestic demand continues to play a powerful role in current growth. On the other hand it only magnifies the
risks associated with public finances.

Slovakia
The Slovak economy grew by 4.7% in H1 2010. The foreign demand is the main engine of growth. The government prepares
the austerity package for 2011 in the amount of roughly 2.5% of GDP.