Foreign students in CEE come mostly from the EU

On the radar

• In Slovenia average real wage growth reached 5.0% y/y in June and today at 10.30 AM CET unemployment rate is due.
• Today at 10 AM CET, Poland will publish retail sales growth for July.
• In Serbia, real wage growth will be released at noon CET.

Economic developments

As the academic year is slowly approaching, we look at the tertiary education students from abroad, with the latest data according to Eurostat being from 2023. In absolute terms, there were 1.76 million students from abroad undertaking tertiary level studies across the EU. That amounts to 8.4% of all students. Among EU countries, Luxembourg had the highest share of foreign students among tertiary education students (52.3%), followed at distance by Malta (29.6%) and Cyprus (22.3%). Within region, Czechia, Slovakia and Hungary have the highest share of foreign students among tertiary education students (around 15% and slightly more for Czechia). When we look at the origin of the students from abroad, the largest group came from elsewhere in Europe for majority of the EU countries. This share was highest in Slovakia (91.3%), followed by Slovenia (89.4%) and Croatia (89.0%).

Market developments

CEE currencies weakened against the euro at the end of the week. EURCZK moved toward 24.55, EURPLN is at 4.26 and EURHUF increased toward 396 in response to statements from Jackson Hole. This week, Hungarian central bank will be the key event locally. We expect stability of rates and Governor Varga only confirms such view with statement that Hungary’s central bank is focused on a “careful and patient” monetary policy to anchor inflation expectations amid upward price pressures. Moreover, “disciplined” monetary policy is needed to maintain market stability in his view. The Ministry of Finance in Poland is preparing a draft law to increase the corporate income tax for banks to 30% in 2026 and 26% in 2027, before settling at a target rate of 23%; this could reduce banks' net profits by an average of 16% in 2026. The Polish MoF confirmed it is not currently working on a previously considered plan to tax the interest on mandatory reserves held by commercial banks at the NBP.

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