Economic policy / Macroeconomic Indicators, Economic Growth
This section reports on economic policy initiatives of the Czech government, the EU, and other entities that have a direct impact on the competitiveness of the country. It also includes information on economic priorities of the AmCham and other leading associations.
Show subcategories ▾
Spotlight issue
Inflation accelerates; CNB will fasten interest rate hikes
Inflation in August again surprised significantly upward above all expectations. Services are becoming more expensive, but price increases are running across the consumer basket. Rising inflation may be largely a temporary phenomenon, but fears of rising inflation expectations are likely to force the CNB to tighten monetary policy more quickly. At the end of September, we expect the CNB's key rate to increase 50 basis points to 1.25%.
View more
Twitter
Linkedin
Facebook
Google+
Wage growth was optically raised by comparison base
The average gross monthly wage increase 11.3% in nominal terms in the second quarter, and 8.2% in real terms. It thus exceeded our and market expectations. Conversely, the central bank, which expected nominal wage growth of 12%, may be satisfied with its estimate. However, wage developments were significantly affected by last year's low comparison base. After seasonal adjustment, wage growth reached only 1.2% in a qoq comparison, which can certainly not be considered rapid dynamics. In addition, the payment of extraordinary rewards in healthcare largely contributed. The median wage in the second quarter was CZK32,408.kom
View more
Economy driven by consumption and investments; exports are the brake
According to a revised estimate, the Czech economy grew 1.0% qoq in 2Q21, after declining 0.4% in 1Q. A preliminary estimate showed growth of only 0.6%. In a year-on-year comparison, GDP grew at a rate of 8.2%, while the preliminary estimate showed 7.8%. Let us recall that the original expectations of economic development for the second quarter were significantly higher, the market consensus was around 2.0% quarter-on-quarter growth. So 1% growth is disappointing in light of the economy waking up after COVID-19 closures. However, given the level of uncertainty, such a surprise is understandable.
View more
