Macroeconomic Forecast Czech Republic

Czech industrial output rose 5.4% y-o-y in November, compared with a 1.7% increase in October, according to figures revealed by the statistical office. The growth was largely unexpected by analysts. The value of new orders increased by 4.0% y-o-y, while domestic new orders declined by 6.8% with non-domestic orders growing 10.6%. Seasonally adjusted industrial production expanded 2.7% m-o-m in November. Given our expectation for a slowdown in German economic activity through the first half of 2012, we forecast Czech IP growth to ease to average 1.8% in 2012 from our estimate of 7.0% in 2011.

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