Economic growth in Russia and Poland will slow in the coming quarters as euro-area banks cut lending to meet stricter capital requirements, Bank of America Corp. said.
Russia’s expansion probably decelerated to 4.6 percent in the first quarter from 4.8 percent in the previous three months, while Poland’s slowed to 3.6 percent from 4.3 percent, David Hauner, Bank of America Merrill Lynch’s London-based head of economics for emerging Europe, the Middle East and Africa, wrote today in an e-mailed note.
“With stalling activity in the quarters ahead, emerging Europe, the Middle East and Africa is likely to underperform the global cycle,” Hauner wrote. The reason is “the region’s exposure to euro-zone deleveraging. We remain negative on foreign-exchange and local debt markets in the months ahead.”
The International Monetary Fund this week raised its 2012 global growth forecast to 3.5 percent from 3.3 percent in January. Still, recent manufacturing surveys suggest slower growth in Russia and Poland, according to Hauner.
Poland’s Purchasing Managers’ Index, compiled by HSBC Holding Plc and Markit Economics, fell to 50.1 points in March from 52.2 in January. Russia’s index was unchanged from January at 50.8, with HSBC calling manufacturing expansion “sub-par.”