The economic outlook has deteriorated We expect the Czech economy to grow by 1.7% this year, accelerating to 2.3% next year. This is lower than in our previous forecast due to a weaker first half of the year and the ongoing conflict in the Middle East. Nevertheless, economic growth should remain resilient, particularly thanks to domestic demand.

Inflation is set to rise to 3% next year Following the 2.1% we forecast for this year, we expect a significant acceleration in inflation in 2027. This is mainly due to higher energy, fuel and food prices resulting from the conflict in the Middle East and lower agricultural yields. Although core inflation should remain elevated, we forecast a slowdown, from 2.9% this year to 2.7% in 2027.