Macro Analysis /
Czech Republic

Czech Republic: FinMin upgrades GDP forecasts, lowers budget deficit projections in 2021-2022

    24 August 2021
    • Improvement of GDP forecast in 2021 is due to stronger household spending and investment
    • Inflation projections were upped as a result
    • General government budget deficit seen slightly lower, but structural deficits to remain above 4% of GDP at least until 2024
    • Same goes for government debt, which will be above 51% of GDP by end-2024
    • Downside risks to forecast include pandemic and automotive industry; upside risks are deferred household consumption, investment and wage hikes
    • We would add political uncertainty after general election on Oct 8-9 as a downside risk