Annual growth in economic activity comes in slightly below CNB forecast
According to the CZSO’s estimate released today, GDP adjusted for price, seasonal and calendar effects rose by 1.5% year on year in 2014 Q4. In quarter-on-quarter terms, economic activity increased by 0.4%. Compared to the CNB forecast, the reported increase in economic activity in 2014 Q4 is 0.3 percentage point lower in year-on-year terms and 0.1 percentage point lower in quarter-on-quarter terms. This difference in the year-on-year and quarter-on-quarter deviations from the CNB forecast is due to a revision of the GDP time series for the previous quarters of 2014. In 2014 as a whole, GDP increased by 2% year on year.
A minor downward deviation of annual GDP growth from the CNB forecast in 2014 Q4 was due to lower-than-expected additions to inventories. As a result, growth in overall gross capital formation was lower than in the forecast. Conversely, growth in fixed investment was faster than expected by the CNB, offsetting partly the deviation in the forecast for total investment. Growth in household consumption and government consumption also exceeded the CNB’s expectations. The growth rates of exports and imports of goods and services were slightly higher than the forecast. The annual decrease in total net exports was somewhat smaller than expected by the forecast.
Overall, the CNB’s expectations that the economy would grow at a slightly lower pace in 2014 Q4 than in previous quarters were confirmed. Following declines in 2012 and 2013, the domestic economy grew significantly last year, owing to higher external demand, a recovery in government investment and last but not least to the easy domestic monetary conditions in the form of a weakened exchange rate. According to the CNB forecast, the Czech economy will continue to grow this year. Owing to accelerating external demand, low oil prices, easy domestic monetary conditions and expansionary fiscal policy, GDP will grow by 2.6% this year. Domestic economic growth will accelerate to 3% next year despite falling government investment, thanks chiefly to a further pick-up in external demand growth.
Petr Král, Director, Monetary Policy and Fiscal Analyses Division
The CNB comments on the GDP figures for 2014 Q4
Annual growth in economic activity comes in slightly below CNB forecast
According to the CZSO’s estimate released today, GDP adjusted for price, seasonal and calendar effects rose by 1.5% year on year in 2014 Q4. In quarter-on-quarter terms, economic activity increased by 0.4%. Compared to the CNB forecast, the reported increase in economic activity in 2014 Q4 is 0.3 percentage point lower in year-on-year terms and 0.1 percentage point lower in quarter-on-quarter terms. This difference in the year-on-year and quarter-on-quarter deviations from the CNB forecast is due to a revision of the GDP time series for the previous quarters of 2014. In 2014 as a whole, GDP increased by 2% year on year.
A minor downward deviation of annual GDP growth from the CNB forecast in 2014 Q4 was due to lower-than-expected additions to inventories. As a result, growth in overall gross capital formation was lower than in the forecast. Conversely, growth in fixed investment was faster than expected by the CNB, offsetting partly the deviation in the forecast for total investment. Growth in household consumption and government consumption also exceeded the CNB’s expectations. The growth rates of exports and imports of goods and services were slightly higher than the forecast. The annual decrease in total net exports was somewhat smaller than expected by the forecast.
Overall, the CNB’s expectations that the economy would grow at a slightly lower pace in 2014 Q4 than in previous quarters were confirmed. Following declines in 2012 and 2013, the domestic economy grew significantly last year, owing to higher external demand, a recovery in government investment and last but not least to the easy domestic monetary conditions in the form of a weakened exchange rate. According to the CNB forecast, the Czech economy will continue to grow this year. Owing to accelerating external demand, low oil prices, easy domestic monetary conditions and expansionary fiscal policy, GDP will grow by 2.6% this year. Domestic economic growth will accelerate to 3% next year despite falling government investment, thanks chiefly to a further pick-up in external demand growth.
Petr Král, Director, Monetary Policy and Fiscal Analyses Division