In May, confidence in the Czech economy was the highest in a year and a half, increasing from 94.7 points in April to 99.7 points, according to the Czech Statistical Office (CZSO).
Statistics from the office report the reason for growing confidence is tied to the loosening of anti-coronavirus measures. Consumer confidence rose by 8.9 points to 102.8 points, while confidence among entrepreneurs rose by 4.3 points to 99.1 points.
“During May, the announced and partially implemented relaxation of measures against the spread of coronavirus significantly contributed to the growth of the business confidence indicator, especially in trade and selected service segments. Respondents from these sectors rated their current economic situation much better than in previous months and relatively optimistic. These are also their expectations for the coming months,” said Jiří Obst from the CZSO.
Statisticians collected data from May 1 to May 18.
The value of 100 points in the index expresses the long-term average from 2003 to 2020. The aggregate indicator was last over 100 in September 2019. Last May, during the first wave of the coronavirus pandemic, it was 75.7 points.
Among consumers, confidence in the economy has risen sharply for the second time in a row. It was 84 points in March, 93.9 points in April, and rose to 102.8 points in May.
“People are significantly less worried than in previous months about the deterioration of the overall economic situation and job losses. However, expectations of consumer price inflation have not changed month-on-month, so they remain well above their long-term average in May,” said Silvie Vyplašilová of the CZSO.
Compared to April, traders’ confidence increased by 4.4 points to 99.3, year-on-year it is higher by 13.8 points. Compared to April, the share of entrepreneurs who assessed the overall economic situation as good increased significantly. The share of entrepreneurs expecting an improvement in their economic situation in the next three months also increased. The stock of goods in warehouses did not change month-on-month.
For the second month in a row, business confidence in services also increased significantly. It reached 92.7 points in May, 85.4 points in April, and was 76.8 points in March. In May, for the first time since last October, the share of entrepreneurs who positively assess current demand prevailed. However, the share of entrepreneurs who expect an improvement in demand within three months did not change month-on-month.
In industry, confidence increased by 1.3 points compared to April to 103.6, which is the highest value in three and a half years. For the first time since January 2018, the number of industrialists evaluating demand as more than satisfactory prevailed. The share of entrepreneurs expecting a growth rate of production within three months decreased compared to April’s significant growth.
Confidence among builders rose by 4.3 points to 115.2 points compared to April. The share of builders assessing demand as insufficient decreased, and at the same time, the share of those who expect an increase in the number of employees within three months increased slightly.
Title image:A woman walks out of a shop in Prague, Czech Republic, Monday, May 10, 2021. The Czech Republic is massively relaxing its coronavirus restrictions as the hard-hit nation pay respect to nearly 30,000 dead. Monday’s wave of easing came after the new infections fell to the levels unseen from August when the government failed to react in time to an opposite trend, the growing numbers of infected which later contributed to record numbers of deaths. (AP Photo/Petr David Josek)