Key events in EMEA next week

We are hopeful in Hungary that after two bad months, industry will be able to rebound somewhat in October, although we know that supply chain issues are still holding back the most important manufacturing sectors (cars & electronics). With export activities under pressure and imports being pushed higher via strong domestic demand, we see the trade balance deteriorating further. The main event comes on Wednesday with the November inflation reading. We see the headline rate moving to 7.3% year-on-year, reaching a level not seen since 2007. As there are widespread price pressures with second-round effects and demand-driven shocks, core inflation is set to move above 5% YoY for the first time since 2008. This could push the central bank to raise the one-week deposit rate again, although the recent strengthening of the forint might give rise to a pause, as the regular monthly rate setting meeting is scheduled on 14 December.