Central European Daily

Yesterday, the Czech koruna extended its losses and eased to the weakest values since March 2009. Nevertheless, today’s data might help the koruna to recover partly. According to the Czech statistical office the economic downturn was not as huge as preliminary data showed. Instead of the quarterly fall of 0.5 %, the GDP fell by 0.1 % q/q in the 3Q 2013. On annual basis the Czech economy fell by 1.3 %. On the other hand, although the above outcome is better than preliminary data signalled, in comparison with the rest of Europe it is not a good result. The domestic demand as well as foreign trade is still stagnating and investments fall. Thus, the only components of GDP which revealed growth were government consumption and inventories. The subdued domestic demand is not very surprising given the fact that real wage growth grew in Q3 2013 by only 0.1 %.