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Impact of US vote on CE/SEE very limited, risk of US/FED outlook looms - RBA

Impact of US vote on CE/SEE very limited, risk of US/FED outlook looms - RBA Author: RBI. Licence: All Rights Reserved.

ZAGREB (Croatia), November 11 (SeeNews) - The impact of the US election results on the region of Central and Southeastern Europe (CE/SEE) is currently very limited given the limited gearing of these economies to the US, but risks could arise from the US/Fed outlook, the Croatian unit of Raiffeisen Bank International said on Friday. 

"More inflationary US policies could add to a market take that the Fed is significantly behind the curve. A more sustained downward trend on global and EM FI/FX markets would also spill-over to CE/SEE, possibly offering more attractive entry levels," the analysts of Zagreb-based Raiffeisenbank Austria (RBA) said in a weekly outlook.

Furthermore, any fears about more US-led global protectionism, possibly against the EU, may dent the sentiment for very internationalised economies, be it for smaller, open CE/SEE economies or the important regional trade hub of Germany, RBA noted.

Secondly, worries about a further rise of populism in CE/SEE as well as inside the EU/euro area as a whole are likely to increase going forward, it cautioned.

In terms of a change in the US-Russian relations, the bank analysts are skeptical this will occur in the near term, as Donald Trump, the US president elect, is expected to focus more on domestic political agenda.

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