Rate cut in Serbia and four rating decisions

This week will feature several important macroeconomic data releases and announcements. September inflation data will be published for Czechia, Hungary, Romania and Serbia. We expect annual inflation to ease in September compared to August by 0.1-0.5 percentage points in all countries except Czechia, mainly due to lower fuel prices and a favorable base effect in Romania. In Czechia, lower fuel prices will only slow down the inflation increase, driven by a low base from a year ago. Industrial production likely contracted in August in Czechia and Slovakia, while Slovenia might report a mild recovery. August retail sales should maintain strong dynamics in Romania (7.7% y/y), but are expected to grow significantly more slowly in Hungary and Slovakia (2.5-2.8% y/y), lagging behind the brisk real wage growth. On Thursday, Romanias statistical office will publish revised GDP time-series since 2022. Any significant data revisions could impact our GDP forecasts, due to changes in dynamics or composition. We expect the National Bank of Serbia to lower its key rate by 25 basis points to 5.5% on Thursday. On Friday, after the market close, there will be a series of rating decisions. S&P is set to review the ratings of Czechia and Romania, and we do not expect any changes in either ratings or outlooks, which are currently stable. Slovenias rating will be assessed by Fitch and Moodys. We expect both Fitch and Moody's to remain on hold i.e. affirm their ratings at 'A' and 'A3', respectively, with stable outlook.