The economy grew by more than eight percent in the second quarter, driven by households – ČT24 – Czech Television


Year-on-year economic growth is the highest in Czech history, but this is due to the low base effect after the onset of the covid pandemic last year. Analysts expected growth of about nine percent.

“The easing of anti-epidemic measures has allowed households to spend more on services and goods, especially long-term durability, and their consumer spending has thus contributed to GDP growth of 2.4 percentage points. However, the lower dynamics of export growth and growing imports led to a negative contribution of foreign demand by 2.2 percentage points, “said Vladimír Kermiet from the CZSO to the quarter-on-quarter development.

Gross domestic product returned to year-on-year growth after a year and a quarter. Before that, it had been declining for five quarters, most notably in the second quarter of last year, when it fell by 10.9 percent. In a quarter-on-quarter comparison, GDP returned to growth in the second quarter, declining over the past year only in the first quarter of this year.

According to statistics, final consumption expenditure accounted for 1.8 points, gross capital formation 1.6 points and external demand 4.8 points. Final consumption expenditure increased by 4.2 percent quarter on quarter and by six percent year on year. Of this, household consumption expenditure increased by 6.5 percent compared to the previous quarter and increased by 7.4 percent compared to the same quarter last year. In particular, the consumption of long- and medium-term durables and expenditure on services increased.

Higher consumption

General government final consumption expenditure fell by 0.2 percent quarter on quarter and rose by three percent year on year. “Year-on-year, collective consumption expenditure continues to grow strongly, while individual consumption expenditure has already declined,” the statistics said.

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Gross value added grew by 0.7 percent quarter on quarter, mainly in trade, transport, accommodation and food service activities and in manufacturing. The construction industry and most of the service sector also performed well. In addition to value added growth, quarter-on-quarter GDP growth was also affected by higher taxes on products, especially value added taxes. Year-on-year, gross value added increased by 8.4 percent.

Gross fixed capital formation increased by 4.2 percent quarter-on-quarter and was 1.5 percent higher year-on-year. More investment was made mainly in housing, the purchase of vehicles and other machinery and equipment.

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