East-Europeans started to feel the effects of the war in Ukraine later than the major Western economies, due to 2-digit salary increases and generous subsidies. Now however, they have to reduce their expenses in order to make ends meet, reads a Reuters analysis, according to which the 2-digit inflation, the over 15% rise in foodstuff prices and the growing energy costs are affecting the spending power of people in Eastern Europe. In Poland, people are shortening their holidays, Czechs are saving by eating out less and looking for a second job, while in Hungary people are buying less food and a lot fewer durable goods. According to analysts, the risk of 2-digit inflation extending into 2023, as well as the new revised estimates regarding the Eurozone point to a risk of recession.
