Central, Eastern and Southeastern Europe on the Road to Recovery from the COVID-19 Crisis

The economies of the Central, Eastern and Southeastern European countries (CESEE) proved resilient to the strong wave of the COVID-19 pandemic in early 2021, and the expected fourth wave is also unlikely to cause as much economic damage as the two waves in 2020. GDP is expected to grow by 4.2 percent in this group of countries in 2021, which would more than offset the decline in 2020 (–2.3 percent). However, inflation has also risen sharply recently, much more strongly than in the euro area. Although inflation is mainly due to energy and food prices, six CESEE countries have already tightened their monetary policy. Other countries in the region are likely to follow soon.