Page 7 - bne_Magazine_September_2018

bne September 2018 The Month That Was I 7
Economics
Eastern Europe
Russia’s GDP expanded by 1.8% in the second quarter, a bit weaker than analysts were expecting but up from 1.3% in the first quarter and continuing in the right direction, economists said on August 12.
Russia Inc will be in profit this year with a budget surplus of between 1.5%-2% of GDP, Russian First Deputy Prime Minister and Minister of Finance Anton Siluanov said on August 13.
Russia’s industrial production unex- pectedly improved in July, rising to 3.9% y/y after taking a hit a month earlier when it fell back to 2.2% in June, Rosstat reports. In particular manufacturing grew 4.6% y/y in July versus a more modest 2.2% y/y the previous month and that added up to a 4.1% y/y gain in 7m18.
Economic sentiment in Ukraine improved in the third quarter of
2018, up to 109.6% compared with 104% and 108.8% respectively in the second and first quarters of this year, the State Statistics Service said on August 15. Three out of the five indicators of business confidence improved.
Ukraine's GDP grew by 3.6% year-on- year in April-June, following a 3.1% y/y growth in January-March, the Ukrstat state statistics service reported making 10 months of continuous growth.
Central Europe
Hungary's state debt manager
AKK sold a combined HUF61.5bn (€187mn) of bonds at auctions on August 16, HUF6.5bn more than planned but at higher costs as yields moved up from the last auction two weeks ago. Jitters over Turkey's falling currency have weighted on bond prices and local currencies across Central Europe. The forint weakened to 325 versus the euro on this week and bond prices were also on a rollercoaster.
Hungary's biggest lender, OTP, reported an after-tax profit of HUF89.5bn (€277.4mn) in Q2, up 11% y/y as business volume grew and its foreign subsidiaries beat expectations, the bank said. Earnings outperformed the HUF81.3bn estimate by Hungarian analysts. Earnings per share (EPS) came to HUF342 for the period.
The Czech koruna has weakened against both dollar and euro on the back of the Turkish crisis fears. On August 16, the koruna dropped by nine halers to 25.81 against euro and by 21 halers to 22.82 against the dollar.
Czech banks are experiencing a very successful year driven mostly by households’ demand for mortgages. In the first half of 2018, banks made
a profit of CZK43.30bn (€1.7bn),
which was CZK600mn more annually, according to Czech National Bank (CNB) – the second highest in Czech history.
Lithuania’s current account showed
a surplus of €86.5mn in June, the Bank of Lithuania reported on August 13. The surplus occurs after a deficit of €85mn was recorded the preceding month. In annual terms, the surplus fell 31.1%.
Southeast Europe
Annual home price growth in Turkey edged down from a revised 10.61% in May to 10.12% in June and has been below the CPI inflation rate since last September. Home price growth is at the lowest level recorded since March 2011. Homes sales in Turkey rose by 7% y/y to 123,878 units in July following
on from the 22% y/y growth registered in June.
Turkey’s calendar-adjusted industrial production index gained 3.2% y/y
in June, marking the lowest annual growth rate registered since December 2016, according to official statistics. Econ- omists had been expecting a 5% growth.
Turkey's unemployment rate edged up from 9.6% in April to 9.7% in May, national statistics institute TUIK announced on August 15. The rate was recorded at 10.8% in January but fell across the following three months. It stood at 10.2% in May 2017.
The Turkish government’s budget surplus grew 22% y/y to TRY1.13bn (€146mn) in July after posting deficit growth of 89% y/y to TRY25.6bn in June. In January-July the budget deficit has expanded by 85% y/y to TRY45bn.
Eurasia
Trade is up between Kazakhstan
and its partners Russia, Belarus, Kyrgyzstan and Armenia – all members of the Eurasian Economic Union (EEU) – expanding by 6.3% y/y to $8.87bn
in January-July according to latest
data published by the State Statistics Committee. Exports rose by 11.3% y/y to $2.84mn, while imports increased by 4.1% y/y to $6.03bn.
Kazakh retail sales were up by 5.6% y/y in January-July, reaching KZT4.4tn (€1.07bn), according to the State Statistics Committee. The gain reflects an ongoing household consumption recovery driven by refreshed economic growth, which stood at 4% in 2017,
up from the 1% recorded in 2016. Kazakh GDP grew 4% y/y in January- July of this year, the official website of the Prime Minister of Kazakhstan stated on August 14.
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