GDP growth comes in higher than expected, with no surprises in structure
According to figures released today, GDP in the Czech Republic rose by 4.3% year on year in the
final quarter of last year. This figure is higher than predicted in the CNB´s January forecast,
which had foreseen annual growth of around 3.5%. This better-than-expected result was due mainly to
favourable net exports, as signalled by the trade balance data for the final months of last year.
In addition to continuing growth in exports, this result was supported by a slowdown in imports
generated by lower growth in domestic investment and consumer demand. The slowdown in domestic
demand growth acted downwards on GDP growth, but was not strong enough to prevail over the positive
foreign trade results.
The upward revision of the GDP growth figures for the previous part of 2004 is also worthy of
note. In the light of this revision, the rapid annual growth recorded at the end of last year seems
less surprising. GDP growth fluctuated around 4% throughout last year and did not deviate from this
level in the final quarter. This view is supported by the quarter-on-quarter GDP growth rate, which
according to CZSO information was 1%. The deviation of the quarter-on-quarter growth rate from the
CNB forecast is considerably smaller than that of the year-on-year growth rate.
Tomáš Holub Executive Director, Monetary and Statistics Department
The CNB comments on the GDP figures for 2004 Q4
GDP growth comes in higher than expected, with no surprises in structure
According to figures released today, GDP in the Czech Republic rose by 4.3% year on year in the final quarter of last year. This figure is higher than predicted in the CNB´s January forecast, which had foreseen annual growth of around 3.5%. This better-than-expected result was due mainly to favourable net exports, as signalled by the trade balance data for the final months of last year. In addition to continuing growth in exports, this result was supported by a slowdown in imports generated by lower growth in domestic investment and consumer demand. The slowdown in domestic demand growth acted downwards on GDP growth, but was not strong enough to prevail over the positive foreign trade results.
The upward revision of the GDP growth figures for the previous part of 2004 is also worthy of note. In the light of this revision, the rapid annual growth recorded at the end of last year seems less surprising. GDP growth fluctuated around 4% throughout last year and did not deviate from this level in the final quarter. This view is supported by the quarter-on-quarter GDP growth rate, which according to CZSO information was 1%. The deviation of the quarter-on-quarter growth rate from the CNB forecast is considerably smaller than that of the year-on-year growth rate.
Tomáš Holub
Executive Director, Monetary and Statistics Department