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Significance

Impacts

Emerging Europe's local bond and equity markets are likely to perform strongly as QE gets under way.

The outlook for currencies is less certain, given the strong dollar and the fragility of sentiment towards emerging markets generally.

However, Emerging Europe's improving economic outlook may help buoy the region's currencies against the dollar's strength.

The biggest threat to investor sentiment towards Emerging Europe remains a sudden, sharp change in expectations of US monetary tightening.

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