Overview of the latest economic events in the Czech Republic

Inflation in the Czech Republic remained stable at 2.7 %, in line with the Czech National Bank's target. This development contributes to positive economic sentiment.

The Prague Stock Exchange recorded increased activity and index growth, reflecting investor confidence in the Czech economy. This development may attract further investment.

According to the PwC 2025 survey, support for adopting the euro is growing among Czech companies. Companies see the euro as a means to increase stability and reduce the costs associated with exchange rate risk.

The Embassy of the Czech Republic in Lusaka has invited Czech companies to participate in the EU-Zimbabwe Business Mission, which will take place from 23 to 25 April 2025 during the 65th EU-Zimbabwe Trade Fair. Zimbabwe International Trade Fair. This mission offers an opportunity for Czech companies to establish business relations in the areas of infrastructure, energy, agriculture, mining, construction and ICT.

The Czech Republic will receive €188 million (approximately CZK 4.7 billion) from the European budget in the form of guarantees for investment loans and combined guarantees with grants. These funds will be directed mainly to critical infrastructure projects, in particular the reconstruction of the Ukrainian energy sector.

Foreign investments and acquisitions

The Czech energy company CEZ plans to sign a contract with the South Korean company Korea Hydro & Nuclear Power (KHNP) for the construction of two new 1000MW units at the Dukovany nuclear power plant by the end of the second quarter of 2025. The value of the contract exceeds CZK 400 billion (USD 17.56 billion).

Pavel Tykač's Seven Global Investments continues to acquire coal and gas assets outside the EU, including operations in the US, Australia and Vietnam. The company has also agreed to buy UK and Norwegian steel mills from Spanish group Celsa. The aim is to double its overseas energy and mining portfolio within two to three years.

Significant events outside the Czech Republic with global impact

According to S&P Global, Germany's recent fiscal stimulus would have a minimal impact on Central European economies, including the Czech Republic. Most of the funds are expected to go towards domestic investment in Germany.

The new US tariffs on imports of automotive parts and vehicles negatively affect the Czech automotive industry. Suppliers, especially those cooperating with German partners, are experiencing a decline in orders and export opportunities.

US airlines like Delta and United were expecting record profits in 2025, but the trade war and subsequent tariffs have dramatically changed expectations. These events led to a drop in travel demand and a significant decline in airline shares.
According to a Bank of America survey, investor confidence in the global economy has reached its lowest level in 30 years.

The main reason is the trade war waged by former President Donald Trump and the recent tariffs that led to the biggest market sell-off since the pandemic.

The United Nations Conference on Trade and Development (UNCTAD) forecasts global economic growth to slow to 2.3 % in 2025, down from 2.8 % in 2024. This slowdown is attributed to escalating trade tensions and growing policy uncertainty.

The World Trade Organization (WTO) has lowered its forecast for global trade growth in 2025 from 3.0 % to a decline of 0.2 %, due to the resumption of US tariffs and wider economic impacts. The WTO warns that a full separation between the US and China could reduce global GDP by 7 % in the long term.

The Bank of Canada has warned that potential US tariffs could lead to a global trade war that could plunge Canada into a deep recession linked to rising inflation. The central bank revised its estimate of first-quarter GDP growth to an annualized 1.8 %, down from its previous estimate of 2.0 %.

Tightening US export restrictions on chips to China caused a sharp drop in technology company shares and a weakening of the US dollar. Nvidia expects to lose $5.5 billion due to the ban on exporting its AI chips to China.

Source about precious metals and Bitcoin: tradingeconomics.com

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