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Fiscal austerity bites in Hungary and the Czech Republic

Today’s Q2 GDP data paint a picture of weakening growth, with Hungary joining the Czech Republic in recession. For now, the drop in output in both countries seems to have been driven as much by domestic austerity as by weaker export demand from Europe. But with external headwinds likely to build over the second half of this year and into 2013, the growth prospects for the entire region are pretty grim.

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