Much better than expected. The OECD has adjusted the outlook for the Czech economy

Organization in message pointed out that the Czechia experienced one of the fastest rates of coronavirus spread within OECD member countries, and pointed to the relatively slow progress of the covid-19 vaccination. “But the economic recovery will pick up in the second half of 2021 as the population is more widely vaccinated,” she added.

The OECD also pointed to rising inflation due to rising food and fuel prices. She predicted that inflation would be between two and three percent in the second half of this year and next year.

The organization expects the Czech National Bank (CNB) to start gradually raising interest rates this year.

At the beginning of May, the CNB Board left the key interest rate unchanged at 0.25 percent. At that time, the CNB predicted that GDP would increase by 1.2 percent this year and by 4.3 percent next year. In its April forecast, the Ministry of Finance estimated economic growth at 3.1 percent this year and 3.7 percent next year.

The OECD has improved its global outlook

The organization also expects the global economy to grow by 5.8 percent this year, while in March it predicted an increase of 5.6 percent.

The organization improved its estimate of economic growth for next year to 4.4 percent from the previously expected four percent. According to the OECD, the economy benefits from vaccination against covid-19 and from government measures to support economic growth.

The OECD improved its estimate of this year’s growth of the United States economy, which is the largest in the world, to 6.9 percent from 6.5 percent in March. This year’s growth in the eurozone is now estimated at 4.3 percent, while in March it was only 3.9 percent. China’s OECD forecast growth of 8.5 percent for this year, compared to 7.8 percent in the March forecast. It improved China’s estimate for next year from 4.9 to 5.8 percent.

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