Czech Republic: Economic sentiment rises in August
August 26, 2013
The economic sentiment index published by the Czech Statistical Office (CSO) rose to 84.8 points in August, up from 83.6 points in July. The increase reflects a notable improvement in consumer confidence, while business sentiment remained virtually unchanged compared to July.
Consumer confidence rose to its highest level in two and a half years, reflecting consumers' less pessimistic view of the general economic situation in the coming year. Households were also more optimistic regarding developments in the labor market, which caused a shift in their willingness to save money for purchasing major goods. Analysts polled by FocusEconomics expect private consumption to show zero growth in 2013, which is unchanged from last month's projection. For 2014, the panel sees private consumption growing 1.2%.
Business confidence inched up to 84.8 points in August (July: 84.0 points). The rise reflected the fact that firms were more optimistic about their business prospects in services and trade, and offset increased pessimism regarding industry and in construction. FocusEconomics panellists see fixed investment falling 2.1% this year, which is down 0.2 percentage points from last month's projection. For 2014, panellists expect investment to rebound and expand 2.2%.
Author: Ricardo Aceves, Senior Economist