Czech Republic Economic Sentiment July 2017

Czech Republic

Czech Republic: Economic sentiment improves in July

July 24, 2017

The economic sentiment indicator published by the Czech Statistics Office (CSO) improved in July. It rose by 0.6 points from the previous month’s result to 97.7 points. While there was a deterioration in consumer confidence, business confidence improved from the previous month.

The business confidence sub-indicator rose from June’s 95.2 points to a six-month high of 96.1 points in July. The reading reflected improvements in sentiment in two out of the four sectors covered by the index: industry and trade. Meanwhile, confidence in the services and the construction sectors dipped from the previous month. Confidence in industry increased the most, with more upbeat expectations about the development of production activity, while expectations of the economic situation over the next three months were unchanged and expectations of the economic situation over the next six months decreased slightly. The trade sector recorded unchanged expectations for the economic situation in the next three months and slightly higher expectations for the economic situation in the next six months. On the other hand, in the construction sector, businesses’ expectations regarding production activity and employment for the next three months deteriorated. Lastly, the services recorded almost unchanged assessments of the current economic situation.

Consumer confidence in July fell for the second consecutive month to an almost one-year low of 105.7 points from June’s 106.2 points. According to the survey, households were most concerned about a deterioration in the overall economic situation in the next 12 months. As for fears of an increase in unemployment, future rises in prices and their financial standing, consumers’ sentiment was almost unchanged. The share of households that intend to save money in July remained stable compared to June.

FocusEconomics panelists expect private consumption to expand 2.9% in 2017, which is unchanged from last month’s projection. For 2018, the panel sees private consumption growing 2.7%. Panelists see fixed investment increasing 2.8% in 2017, which is unchanged from last month’s projection. For 2018, panelists expect fixed investment to expand 3.6%.

Author: Massimo Bassetti, Economist

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Czech Republic Economic Sentiment Chart

CzechRepublic Economic Sentiment July 2017

Note: The Economic Sentiment Indicator is in compliance with the EU methodology presented as a weighted average of confidence indicators in industry, construction, trade, selected services and the consumer confidence indicator. Average of 2005 = 100.
Source: Czech Statistical Office (CSO).

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