In August, sentiment in the Czech economy showed a divided picture. While entrepreneurs in several sectors signalled greater confidence, consumers looked more pessimistic about the future.
Entrepreneurs’ confidence in the economy increased in August in selected service sectors (+5.9 points), in construction (+1.2 points), and in retail (+1.1 points). In manufacturing, it remained unchanged, staying at the July level.
“The favourable development in business confidence is primarily due to improved conditions in certain service sectors, where expected demand, especially in the financial sector, has risen significantly. The services confidence indicator thus reached its highest level since April 2008,” explained Jiří Obst, head of the Business Survey Division at the Czech Statistical Office (ČSÚ).
Consumer confidence, on the other hand, declined in August. The indicator fell by 5.1 points to 99.0. Compared with July, the proportion of consumers expecting a deterioration in the general economic situation in the Czech Republic, as well as their own financial situation, over the next twelve months increased. Furthermore, the number of households assessing their current financial situation as worse than in the past twelve months rose. The proportion of respondents not planning any major purchases in the next twelve months remained almost unchanged.
“In August, consumer confidence fell slightly below its long-term average after three months. Compared with the previous month, respondents expressed greater concerns about a deterioration in the economic situation in the Czech Republic and also assessed their current financial situation less favourably than in the past twelve months. Moreover, in August, after two months, the proportion of households expecting a deterioration in their financial situation over the next twelve months once again predominated,” said Anastasija Neradová from the Business Survey Division of the ČSÚ.
