Czech Republic’s GDP will grow in 4.3% in 2017 and 3.2% in 2018, driven by faster recovery and investments and stronger household consumption. Consumption will benefit from high employment and wage growth exceeding 6%, which, together with inflation totalling 2.5%, gives extensive room for higher household spending.
This stems from the prediction of the Czech Banking Association (ČBA). The main driving force in 2018 will again be domestic demand, spready evenly between consumption and investments. Inflation is expected around 2% of central bank’s target and the real purchasing power of wages will thus increase by more than 4%.