Czech Republic: Economic sentiment jumps to 30-month high
December 20, 2013
The economic sentiment indicator developed by the Czech Statistical Office (CSO) rose to 91.2 points in December, which was up from the 90.4 points recorded in November. The indicator, which now sits at its highest point since June 2011, primarily reflects an improvement in business confidence.
Business confidence rose to the highest level since March 2012 in December, reflecting higher confidence in trade, as well as in selected services. Business sentiment in industry was unchanged over the previous month, while it decreased for construction. FocusEconomics panelists see fixed investment falling 3.5% in 2013, which is down 0.4 percentage points from last month's projection. For 2014, panelists expect investment to rebound and expand 2.2%, which is unchanged from last month's Consensus.
Conversely, consumer confidence fell slightly in December. According to the CSO, consumers were marginally more pessimistic regarding the country's overall economic situation for the next 12 months. In addition their willingness to purchase big-ticket items decreased compared to the previous month. Meanwhile, households' views of the future conditions in the labor market remained unchanged.
Forecasters surveyed by FocusEconomics expect private consumption to expand 0.3% in 2013, which is unchanged from last month's projection. For 2014, the panel sees private consumption growing 1.3%, which is also unchanged over the previous month's Consensus.
Author: Ricardo Aceves, Senior Economist