Czech Republic: Economic sentiment plunges to lowest level in nearly three years
July 24, 2012
The economic sentiment index published by the Czech Statistical Office fell to 83.2 points in July from 84.6 points in June, driving the index to levels last seen in November 2009. As a result of the monthly decline, the index is now 7.6 points below the level observed in the same month last year. The monthly drop mainly reflected a further deterioration in business confidence, with the corresponding sub-indicator falling to its lowest level since January 2010. According to the statistical institute, a majority of firms in the industrial and services sectors showed a more pessimistic assessment of their business prospects in the next six months. Meanwhile, after plunging to a record-low in May, the consumer confidence index improved for a second consecutive month. Respondents to the July survey showed somewhat less concern about the general economic situation in the next 12 months. As a result, a majority of consumers showed a less pessimistic assessment about their own financial situation as well. In addition, the number of consumers expecting unemployment to increase compared to the previous month remained broadly unchanged.
Author: Ricardo Aceves, Senior Economist