The Czech economy shrank by 0.4 percent year on year, according to updated data.


Illustrated picture
| photo: Ludk Peina, MAFRA

The revised estimate confirmed the modest quarterly growth of the Czech economy, while the quarterly decline occurred in the third quarter. Thus, compared with the preliminary estimates of statistics, the decline is insignificant. The difference in development from GDP is mainly due to the change in the dynamics of product subsidies since the beginning of the year.

The decrease in the second quarter was influenced by the final consumption expenditures of households and apartments according to C them. In contrast, government spending on consumption, gross fixed capital formation, and external demand had a positive effect.

The Czech economy collapsed in the second quarter of last year much less than originally expected. The slow, unforeseen development of the economy has, in particular, a significant impact on foreign trade, which is the so-called crisis of international networks of suppliers-consumers. The reason for this is the Covid pandemic, said Luk Kovanda, chief economist at Trinity Bank.

The economy weakens in the fourth quarter of the year. In the first quarter, median income fell 0.4 percent.

On the demand side, Q2 GDP growth was mainly driven by gross fixed capital formation and external demand. Thus, household income for final consumption, which increased for the first time in six quarters, had a positive effect. On the contrary, the change in the state of resources had a significant negative impact on the quarterly comparison, comments Vladimir Kermiet, editor of the department of domestic TS.

Final consumption expenditure increased by 0.3% qoq, of which household final consumption expenditure increased by 0.2%. Growth occurred in sales for the purchase of short-term consumer goods and services.

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