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Eastern Europe

Thanks to a mild winter, EU gas stores are expected to finish the heating season at 50% full versus a five-year average of 34% - a positive factor in terms of easing the ongoing energy crisis. Energy costs coming off their peaks also softened worries about global recession, along with expectations of a strong performance from China following the easing of its COVID policy.

Economic forecasts for 2023 are cautious in this region. In February, the annual inflation rate in Poland was 18.4% - the highest since July 1996 - and this will weigh on economic growth in the coming quarters; GDP, meanwhile, is expected to climb 0.4% this year. Even despite the milder-than-expected energy crisis, many businesses have temporarily closed for the winter and bankruptcy declarations are at their highest levels since data collection began in 2015. Ukraine’s GDP is expected to grow 1% this year while a contraction of 2% is anticipated for Russia.

On the metals markets, there is not much new to report. The recent LME plunge has slightly slowed scrap flows into yards, although this has been partially balanced in Poland by a stronger zloty.