The Czech economy grew by 2.6 percent year-on-year in the second quarter of this year, and by 0.5 percent compared to the previous three months, the Czech Statistical Office (ČSÚ) reported on Friday. The figures are stronger than its initial estimate at the end of July, which projected GDP growth of 2.4 percent year-on-year and 0.2 percent quarter-on-quarter.

“The revised estimate confirmed the continued growth of the Czech economy,” the ČSÚ stated. Year-on-year GDP growth was the fastest in the past three years. It was supported by higher final consumption expenditure and changes in inventory levels. On the negative side, gross fixed capital formation and a lower trade surplus compared to last year weighed on growth.

Final consumption expenditure rose by 1.1 percent quarter-on-quarter and 3.1 percent year-on-year. Household spending increased by 3.4 percent compared to last year, while government spending rose by 2.2 percent. “Changes in inventories amounted to plus 36.7 billion crowns, which was 27.2 billion more than in the same quarter of the previous year,” the ČSÚ noted.

Gross fixed capital formation increased by 0.5 percent quarter-on-quarter but fell by 0.2 percent year-on-year. “The year-on-year decline was mainly due to lower investment in housing and in other machinery and equipment, while investment in other buildings, construction projects, and transport equipment grew,” the ČSÚ pointed out. The foreign trade surplus in goods and services at current prices decreased by 11 billion crowns to 118.8 billion crowns compared to last year’s second quarter.

Gross value added rose by 0.5 percent quarter-on-quarter and by 2.8 percent year-on-year in the second quarter. Growth was driven by trade, transport, accommodation, and food services, with industry and construction also making a positive contribution. On the other hand, financial and insurance activities had a negative impact.

Source: e15
Prepared by the team of foreign office CzechTrade South Korea (Seoul)