Czech GDP Contracts 3.6% In First Quarter

In the first quarter of this year, the Czech economy fell by 2.2 percent year-on-year, and by 3.6 percent quarter on quarter, the Czech Statistical Office reports. The decline is the greatest since the economic crisis in 2009. The results were significantly affected by the global coronavirus pandemic and the associated restrictive measures.

Data on the economic downturn is in line with the expectations of the Czech National Bank and the entire market, said CNB Governor Jiří Rusnok. The data has not changed CNB’s outlook, Rusnok said.

The negative y-o-y GDP development was due to a decrease in foreign demand and by lower capital formation. Increasing expenditure of the general government sector had a positive influence. The decrease of the gross value added formation was influenced the most by the development in manufacturing and in a group of economic activities of trade, transportation, and accommodation and food service activities, CZSO reports.