Bi-Weekly Report 10-23 October 2017


Lending activity (FX-adjusted) rose sharply in 9M:17, largely benefiting from the Government's credit guarantees and relax​ed macro-prudential measures

Customer deposits (FX-adjusted) accelerated in 9M:17, supported by dissipating uncertainty after the mid-April referendum and more attractive remuneration rates

The seasonally-adjusted unemployment rate receded by 0.4 pps q-o-q to 11.2% in Q2:17



Headline inflation rose to a 4-year high of 1.8% y-o-y in September from -0.5% at end-2016, on the back of stronger domestic demand and higher food prices

Credit activity picked up rapidly in 9M:17, sustaining economic activity



Headline inflation rose sharply to 2.1% y-o-y in September from 0.1% at end-2016, mainly due to higher energy prices

Credit expansion strengthened in 9M:17, underpinning the economic recovery

Customer deposits gained momentum in 9M:17, due to solid economic growth



Inflationary pressures heightened in 9Μ:17, but remained well anchored

NBS to keep its key rate on hold until the initiation of a new cycle of monetary policy tightening in Q3:18



The ruling coalition is set to secure a landslide victory in the local elections, strengthening its hand to proceed with ambitious reforms

Customer deposit growth maintained momentum in 9M:17

Credit to the private sector picked up in 9M:17



Electricity generation declined markedly in H1:17, due to adverse weather conditions

Headline inflation has eased since the beginning of the year due to softer food inflation (excluding fruit and vegetables)



Banking sector bottom line deteriorated markedly in H1:17 due to a sharp rise in NPL provisions



Headline inflation eased for a 2nd consecutive month in September – down to 31.6% y-o-y from a 3-decade high of 33.0% y-o-y in July

A sharp decline in inflation during the next two months to strengthen the CBE's hand to initiate a new cycle of monetary policy loosening in January



Bi-Weekly Report 10-23 October 2017