Czech Rep. Economic Outlook
February 5, 2019The economy appeared to gain some momentum in the final quarter of 2018, following a modest showing in the third quarter which was buttressed by upbeat domestic demand. Industrial output slowed in November but nevertheless remained solid on the back of strong car production, which also translated into buoyant growth of sales abroad. Furthermore, although the unemployment rate edged up in December, this was mainly due to seasonal factors and the labor market remains extremely tight. Coupled with the multi-year high wage growth that has been logged in recent months, this indicates robust household spending at year-end. The strong retail sales’ figures in October and November—particularly in the core sectors which exclude fuel, food and cars—reinforce this trend. It seems, however, that the economy entered 2019 on softer footing: The PMI dipped to a six-year low in January due to a fall in output and new orders amid weaker external demand.
Czech Republic Economic GrowthGrowth is expected to slow a tad but remain solid this year. An overly tight job market and buoyant wage dynamics should continue propelling private consumption ahead. Meanwhile, despite losing some strength, capital expenditure should continue expanding at a healthy clip, in part supported by increased infrastructure investments. On the downside, ongoing global trade tensions and a faster-than-expected slowdown in activity in the EU could weigh on the external sector’s contribution to growth. Met the why particular Consensus Forecast panelists see GDP growing 2.7% in 2019, which is down 0.2 percentage points from last month’s projection, and 2.6% in 2020.
Czech Republic Economy Data
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Czech Republic Facts
|Bond Yield||1.81||-1.85 %||Feb 14|
|Exchange Rate||22.89||-0.66 %||Feb 14|
|Stock Market||1,049||-0.11 %||Feb 14|
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Czech Republic Economic News
February 15, 2019
Annual GDP growth accelerated from 2.4% in the third quarter to 2.9% in the fourth quarter of 2018 in seasonally- and price-adjusted terms, according to preliminary data released by the Czech Statistical Office (CSO) on 15 February.
February 13, 2019
Consumer prices rose 1.0% from the previous month in January, accelerating notably from December’s 0.1% increase.
February 7, 2019
At its first meeting of the year on 7 February, the Bank Board of the Czech National Bank (CNB) kept the two-week repo rate unchanged at 1.75%, marking the second consecutive “hold”.
February 6, 2019
Industrial production declined 1.4% year-on-year in December, contrasting November’s strong 4.8% increase.
February 1, 2019
The manufacturing Purchasing Managers’ Index (PMI) produced by IHS Markit dipped from 49.7 in December to 49.0 in January, marking the second consecutive monthly contraction of the all-important sector and hitting a six-year low.