GDP in Czech Republic
Czech Republic - GDP
Economy jumps in Q1 on the back of resilient household spending and a vibrant external sector
The Czech economy gained considerable steam in the first quarter of 2017, following a not-so-brilliant Q4. Growth in Q1 came on the back of robust private consumption and a strongly supportive external sector. Moreover, the previous quarter’s sharp fall in fixed investment gave way to a strong turnaround on the back of higher EU fund absorption. GDP growth strengthened from 1.9% year-on-year (yoy) in Q4 to 2.9% in the first quarter of this year. On a quarter-on-quarter base, the economy grew 1.3% in Q1, more than triple Q4’s 0.4% expansion.
The Czech economy continues to be supported by robust private consumption, which contributed 1.0 percentage point to growth in Q1. The enduring expansion in private consumption—which grew 2.8% in Q1, marginally down from Q4’s 2.9% increase—has been supported by rising wages and a buoyant labor market. Moreover, investment contracted a milder 0.6% in Q1 after plummeting 6.9% in Q4 due to the lower absorption of aid from the European Structural and Investment Fund. Moreover, government consumption accelerated considerably in Q1, expanding 2.4% after the 0.2% growth recorded in Q4.
Meanwhile, the external sector added 1.7 percentage points to growth. Imports of goods and services accelerated from a 0.5% increase in Q4 to a 3.9% rise in Q1, reflecting stronger demand for investment goods, particularly car parts. Export growth jumped from Q4’s 1.8% to 5.4% in the first quarter of this year, benefiting from a firm recovery in the automotive industry.
The economy is forecast to accelerate this year as a tight labor market prompts further wage growth, underpinning household spending, and stronger external demand supports exports. Nevertheless, a slower-than-expected implementation of EU-financed investment projects could restrain the scope of the expansion.
The Czech National Bank expects the economy to expand 2.9% in 2017 and 2.8% 2018. FocusEconomics Consensus Forecast panelists expect the economy to expand 2.6% in 2017, which is unchanged from last month’s projection. For 2018, the panel also sees GDP increasing 2.6%.
Czech Republic - GDP Data
|Economic Growth (GDP, annual variation in %)||2.0||-0.7||-0.5||2.7||5.4|
5 years of economic forecasts for more than 30 economic indicators.
Czech Republic GDP Chart
Source: Czech Statistical Office and FocusEconomics calculations.
Czech Republic Facts
|Bond Yield||0.90||-5.98 %||Jul 26|
|Exchange Rate||22.37||0.54 %||Jul 26|
|Stock Market||1,012||-0.32 %||Jul 26|
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July 24, 2017
The economic sentiment indicator published by the Czech Statistics Office (CSO) improved in July.
July 12, 2017
In June, consumer prices were unchanged compared to the previous month, down from May’s 0.2% increase.
July 3, 2017
The Manufacturing Purchasing Managers’ Index (PMI) produced by IHS Markit In June remained unchanged at May’s 56.4.
June 29, 2017
At its 29 June meeting, the Czech National Bank (CNB) decided unanimously to leave the two-week repo rate unchanged at its “technical zero” of 0.05%, meeting market expectations.
June 26, 2017
The economic sentiment indicator published by the Czech Statistics Office (CSO) remained largely unchanged in June.