CEE economies are bracing themselves for a slow recovery. But as unemployment is set to rise and high inflation isn't an issue any longer, more monetary easing is on the way. In FX, RUB prospects remain bright while CZK remains our favourite CEE low yielder. Poland central bank's aggressive steps should translate into a further steepening of PLN swap curve.

The government is proposing a further increase in the state budget deficit to CZK500bn. The main reason is the rise in spending to support the economy at this time of crisis. In our opinion, however, the government will continue to have problems implementing expenditure plans, which will lead to a deficit of only CZK400bn. This also implies less additional CZGB issuance, further reduced by using state financial assets and the drawdown of EUR loan programs. In our view, the MinFin has only CZK56.7bn left to issue by the end of the year, which shouldn’t be a problem to place.

Many protective measures have been set up at Václav Havel Airport Prague in co-operation with public health authorities for several months. Departures and arrivals take place under strict hygienic conditions, which are to ensure the health and safety of passengers. All passengers and visitors must wear face masks in all areas of the airport, keep a safe distance from other people, wash their hands frequently and thoroughly and use hand sanitizers. Thank you for protecting yourselves and those around you.

We recommend all passengers also check protective measures of their airline and confirm the current conditions for entering the country to which they are travelling from Prague.

Governments allocated $10 trillion for economic stimulus in just two months—and for some countries, their response as a percentage of GDP was nearly ten times what it was in the financial crisis of 2008–09.