GDP comes in slightly below the CNB forecast in 2022 Q4
The CNB comments on the GDP figures for 2022 Q4
According to the CZSO’s estimate released today, gross domestic product adjusted for price, seasonal and calendar effects rose by 0.2% year on year in 2022 Q4. In quarter-on-quarter terms, the economy declined by 0.4%. Domestic economic activity increased by 2.4% in 2022 as a whole. By comparison with the CNB’s winter forecast, GDP grew slightly less year on year in Q4 and its quarterly decline was somewhat deeper than forecasted.
The data released on economic activity confirm that the Czech economy switched to a shallow recession in the second half of 2022. Household consumption, which is being affected by the sharp fall in real income and worse sentiment, decreased more significantly in Q4 than expected by the CNB. The contribution of net exports was also lower than forecasted, with exports and especially imports rising faster than projected. Conversely, gross capital formation rose above expectations. This was due to surprisingly high year-on-year growth in fixed investment, which was largely caused by a historical revision. General government consumption recorded moderate year-on-year growth, whereas the CNB had expected a partial drop. The deviations of the individual demand components from the forecast virtually offset each other overall.
2022 Q4
year-on-year in %
MPR Winter 2023
actual figure
Gross domestic product
0.5
0.2
Household consumption
-3.3
-5.5
Government consumption
-1.0
0.9
Gross capital formation
0.2
2.6
Exports of goods and services
8.6
9.7
Imports of goods and services
5.7
7.6
constant prices, seasonally adjusted
According to the CNB’s winter forecast, the domestic economy will drop slightly overall this year and will be below its potential. The economic downturn will occur mainly in the first half of the year, as output will be adversely affected by a deteriorating financial situation of households, slower growth in external demand and lingering problems in global logistics. Economic activity will return to growth in the second half of the year. An unwinding of the problems with supplies of materials and components for production during the year will gradually support export activity, with net exports significantly aiding the economic recovery. Private consumption will also rebound in late 2023 and early 2024, thanks to a fade-out of the high inflation and renewed real wage growth. Likewise, growth in private fixed investment will recover on the back of stronger external demand and in connection with a switch to alternative energy sources amid a long-term shift towards automation, robotisation and digitisation. In 2024, economic activity will grow by more than 2%.
Petr Král, Executive Director, Monetary Department
GDP comes in slightly below the CNB forecast in 2022 Q4
The CNB comments on the GDP figures for 2022 Q4
According to the CZSO’s estimate released today, gross domestic product adjusted for price, seasonal and calendar effects rose by 0.2% year on year in 2022 Q4. In quarter-on-quarter terms, the economy declined by 0.4%. Domestic economic activity increased by 2.4% in 2022 as a whole. By comparison with the CNB’s winter forecast, GDP grew slightly less year on year in Q4 and its quarterly decline was somewhat deeper than forecasted.
The data released on economic activity confirm that the Czech economy switched to a shallow recession in the second half of 2022. Household consumption, which is being affected by the sharp fall in real income and worse sentiment, decreased more significantly in Q4 than expected by the CNB. The contribution of net exports was also lower than forecasted, with exports and especially imports rising faster than projected. Conversely, gross capital formation rose above expectations. This was due to surprisingly high year-on-year growth in fixed investment, which was largely caused by a historical revision. General government consumption recorded moderate year-on-year growth, whereas the CNB had expected a partial drop. The deviations of the individual demand components from the forecast virtually offset each other overall.
constant prices, seasonally adjusted
According to the CNB’s winter forecast, the domestic economy will drop slightly overall this year and will be below its potential. The economic downturn will occur mainly in the first half of the year, as output will be adversely affected by a deteriorating financial situation of households, slower growth in external demand and lingering problems in global logistics. Economic activity will return to growth in the second half of the year. An unwinding of the problems with supplies of materials and components for production during the year will gradually support export activity, with net exports significantly aiding the economic recovery. Private consumption will also rebound in late 2023 and early 2024, thanks to a fade-out of the high inflation and renewed real wage growth. Likewise, growth in private fixed investment will recover on the back of stronger external demand and in connection with a switch to alternative energy sources amid a long-term shift towards automation, robotisation and digitisation. In 2024, economic activity will grow by more than 2%.
Petr Král, Executive Director, Monetary Department