Czech Republic: Economic sentiment rises to two-year high
October 24, 2013
The economic sentiment indicator developed by the Czech Statistical Office (CSO) jumped to 88.9 points in October, up from 87.5 points in September. The indicator now sits at its highest point since October 2011 and primarily reflects notable improvements in both business and consumer confidence.
Business confidence rose to the highest point in 18 months, reflecting higher confidence levels in industry, construction and services. Conversely, business sentiment regarding trade waned to a certain extent. FocusEconomics panelists see fixed investment falling 3.1% this year, which is down 0.7 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.
Consumer confidence also improved in October, rising to its highest level in more than two years. According to the CSO, consumers are less pessimistic about the country's overall economic situation for the next 12 months and are more optimistic about their future financial situation. However, respondents to the October survey were more pessimistic regarding future job prospects.
Forecasters surveyed by FocusEconomics expect private consumption to expand 0.4% in 2013, which is up 0.2 percentage points from last month's projection. For 2014, the panel sees private consumption growing 1.2%, which is unchanged over the previous month's Consensus.
Author: Ricardo Aceves, Senior Economist