30/07/2025 13:27
Impact
of US tariffs to turn from positive to negative While stockpiling by US companies and
households ahead of the tariffs supported Czech economic growth at the
beginning of the year, this effect will fade over the rest of the year. In line
with this, we expect the economy to grow by 1.9% this year, before slowing
again to 1.1% next year. Although export and industrial performance will
decline, household consumption and real wages should continue to recover. Despite
its current elevated level, inflation should head back down towards the target We estimate that inflation will
average 2.4% in 2025, before falling to 1.9% in 2026. Rapid growth in prices of
services, houses and food will keep inflation elevated this year. However, the
effects of tight monetary policy, lower energy and fuel prices, and economic
and labour market slowdowns should be felt fully next year. We expect wage
growth to cool on the back of higher unemployment.