Czech Republic’s economic confidence deteriorates again moderately

The economic sentiment in the Czech Republic has again deteriorated moderately following a slight rebound. However, the economic mood in the country continues to be at a similarly high level as 2015. Thus, the acute sense of positivity that was registered at the end of 2015 was just for a brief period of time.

Even if the economic sentiment might not show the uncertainties emerging from the Brexit vote of the UK, it implies that the Czech economic growth rate has begun slowing. Business moods in the country shows development of employment and also business orders in individual sectors, said KBC Market Research in a research note.

Therefore, it is not a surprise to have witnessed a decent growth in industry, carrying the wave of increasing demand for cars from Europe on one hand, while construction being negatively affected by lack of new projects on the other hand.

The consumer’s positive mood has also eased from its highs in the country as households are even more concerned of a likely decline of the Czech economy’s position in the coming year. Meanwhile, the consumers are not worried about unemployment or other likely negative affect from subdued economic growth on their budgets.

“We consider the current moderate mood deterioration to be nothing dramatic; we see it as just a reflection of the actually ongoing and, moreover, anticipated deceleration of the CR’s economic growth to 2.5 percent”, added KBC Market Research.