The Czech Republic
The growth of the Czech economy will slow down in 2018 but it will remain strong and above the Eurozone and EU average. The Czech economy will be even more afflicted by the lack of employees, which may lead to a faster salary growth. However, the labour and real estate markets are increasingly showing signs of overheating. These are the results of the Czech Economic Outlook for 2018 prepared by Deloitte’s analytics team.
“We expect GDP growth to slow down to 2.9 percent in 2018. The key factors include GDP growth in the Eurozone of 1.6 percent, continuing increase in interest rates and a slightly negative impact of the fiscal policy,” says David Marek, Deloitte’s Chief economist.
Facts & figures
|Population:||10.6 mil||10.6 mil|
|GDP per capita (EUR):||16,726||18,193|
|GDP (EUR bn):||177||192|
|Economic growth (GDP annual variation):||2.5%||4.6%|
|Inflation (CPI, annual variation, eop):||2.0%||2.4%|
Outlook for 2019 The economy is expected to maintain a broadly stable and solid pace of expansion this year. Private consumption should continue to expand, although at a somewhat slower rate compared to last year, supported by extremely tight labor market conditions and rising wages.
A preliminary reading of national accounts data showed that economic growth in the third quarter slowed markedly on weakening domestic demand, partly due to a high base effect. Data for the fourth quarter, meanwhile, has been largely positive.
Facts & figures
|Population:||17.0 mil||17.1 mil|
|GDP per capita (EUR):||41,259||42,926|
|GDP (EUR bn):||703||733|
|Economic growth (GDP annual variation in %):||2.2||3.2|
|Inflation (HICP, annual variation, eop):||0.7%||1.2%|
Outlook for 2019 The FocusEconomics Consensus Forecast panel also expects economic growth to decelerate next year, estimating the economy to grow 2.0%, which is down 0.1 percentage points from last month’s forecast. Uncertainty over Brexit and global trade tensions remain the key downside risks to the outlook. On the other hand, a tight labor market should support private consumption and the economy is expected to be further buttressed by solid export and fixed investment growth. For 2020, the panel projects 1.7% growth.
Published in January 2019.