As the deadline date for Brexit looms ever closer, Czechs are asking themselves what the economic impact of a “hard” Brexit would be. A report published by Česká spořitelna, says that as the country’s fifth largest trading partner, the UK’s exit on WTO rules could cost tens of thousands of Czech jobs and around CZK 55 billion. However, the economic impact would be too small to affect projected economic growth.
Unemployment in the Czech Republic remained at 2.8 percent in November, the
same as the previous month, the Czech Labour Office announced on Monday.
The number of jobless dropped to 215,010, which is the lowest figure since June 1997, while the number of vacancies increased to over 323,500. Last November, unemployment stood at 3.5 percent.
The lowest rate of unemployment, 1.8 percent, is in the Pardubice region, while the highest rate is in region of Moravia-Silesia and Ústí nad Labem with 4.3 percent of people out of work.
Czech industrial production grew by 6.7 percent year on year in October,
after somewhat weaker performance in recent months, data from the Czech
Statistical Office show.
New orders reached double digit growth, suggesting that recent weakness could be related to one-offs.
Manufacturing grew by 7.7 percent, supported by strong automobile production, up 8.8 percent in annual terms after falling in the previous two months.
The Czech Republic had the lowest unemployment rate in the EU in 2017,
according to the Statistical Yearbook, released by the Czech Statistical
office on Thursday.
In 2017, the Czech Republic had an average 2.9 unemployment rate, compared with EU average of 7.6 percent. The Czech Republic was followed by Germany with 3.8 percent, while Greece was placed at the other end of the scale with 21.5 percent.
Financial Administration officials have carried out over 160,000 checks
since the introduction of electronic cash registers, a measure introduced
by former Finance Minister Andrej Babiš to counter the grey economy and
The authorities have issued nearly 13,000 fines to the tune of 128 million crowns. Twenty-eight businesses were forced to close down for failing to follow the rules.
The first phase of the four-stage electronic cash registers system was introduced in December 2017. There are currently around 177,000 businesses using the registers.
The Prague City Council plans to raise rents on flats now leased out by the
municipality or city administration at below market rates, councillor Adam
Zábranský (Pirates) told the ČTK news agency in an interview.
Zábranský said the council plans to review the contracts of up to 10,000 flats, many of which are rented out at one-third the going rate “for no apparent reason”.
According to the developer Trigema, as cited by ČTK, tenants of city dwellings usually pay 60 to 120 crowns per square metre, so between 4,680 to 9360 crowns for a standard 78 sq m flat. The market rate would be above 20,000 crowns.
The Czech economy has been outperforming its central European neighbours and is set to reach something of a psychological milestone next year, when GDP per capita is on track to reach 85 percent of the Eurozone average. In more tangible terms, though, the average Czech is enjoying greater purchasing power, and confident they can always find work.
The rise in apartment prices in the Czech Republic, which has been extremely rapid in recent years, has come to a halt or at least decelerated, due to Czechs reaching the limits of their purchasing power as well as new mortgage regulations, iDnes.cz reported. However, things are rather different in Prague, the news site said.
Downward pressure on the Czech crown will likely continue for years to come
due to gradual sell-offs by foreign investors who bought a large volume of
the currency during the three-year period of intervention by the Czech
National Bank to keep the domestic currency artificially weaker, analysts
The crown weakened to below 26 to the euro in mid-November, its lowest level been since June, when the central bank started began a series of interest rate hikes, of which there have been five in 2018.
Pressure on the crown is unlikely to ease for the rest of the year as Czech economic growth lagged behind its regional peers in the third quarter. It is also under pressure from seasonal euro buying by banks that cut crown deposits at the end of the year to reduce payments into the state-run "Resolution Fund".
However, while the crown’s expected weakness in the coming weeks would, technically, open room for a December rate increase some analysts say it now seems more likely policy makers will wait for the year-end effect to fizzle out before they act again.
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