Following a very strong start in the first quarter of this year, GDP growth in most economies in New Europe appears to have slowed down slightly in Q2. While domestic inflation rates appear to have already reached a cyclical peak, worries over the deepening euro area debt crisis remain a major cause of concern. Equity, fixed income and currency markets came under renewed pressure in recent weeks. We expect investor sentiment towards the region to remain cautious in the short term, with markets awaiting further concrete measures by euro area authorities.
Lingering euro area debt crisis weighs on regional markets
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