The Czech economy falls by 11% YoY in 2Q

Revised GDP figures were very close to their flash reading signaling an 11% YoY fall in the Czech economy in the second quarter of this year. Weaker foreign demand and household consumption are the main drivers.

The structure of Czech GDP in the second quarter revealed that foreign demand, in particular, contributed to the economic downturn, with exports falling by a record 21% quarter-on-quarter (QoQ) and -23.3% year-on-year (YoY), and imports by 17.6% QoQ (-18%YoY). Weaker household consumption, down by 6% QoQ and 7.6% YoY, was the next big driver, while it only stagnated in year-on-year terms in the first quarter.

Investments including inventories also fell at a double-digit rate, although fixed investment itself grew slightly quarter on quarter and its YoY fall remained around 5%. However, only investment in infrastructure projects grew, while in transport or machinery equipment their year-on-year decline intensified. Investment in housing also fell slightly year on year, while it was still growing by 7% in the first quarter.