Economic sentiment keeps deteriorating

While the overall Economic Sentiment Indicator (ESI) deteriorated further in April (the CEE8 average dropped marginally to 97.2 in May from 97.35 in April), consumer confidence shows signs of recovery. Looking across countries, Czechia, Croatia, and Slovenia reported improvements in overall economic sentiment, while pessimism persists in othersmost notably in Hungary, Serbia, and Slovakia. Hungarys economy underperformed in the first quarter of the year, while Slovakia faces the highest effective tariff rate due to its automotive sectors exposure to the U.S. and the 25% tariff rate.Finally, the uptick in consumer confidence is encouraging. If this trend continues, private consumption should continue to support growth in a more meaningful way in the quarters to come.