The coronavirus infection will cause a drop in GDP of around 8% in 2020. The economy will return to growth in 2021 and reach prepandemic levels at the end of 2022. As part of the Inflation Report, the Czech National Bank (ČNB) announced that reduced foreign demand, a sharp rise in unemployment and worsened unemployment would have an adverse effect in the coming months, together with deteriorated perception of the situation by companies and households. The decline in GDP will be mainly due to the decline in private investment. Their recovery will be dampened by a deep decline in foreign demand, which will also affect exports. Wage dynamism will fall sharply and will recover in 2021.
Source: ČIA NEWS, August 10th, 2020
Compiled by the team of CzechTrade office in Riga.