Czech Republic: 2023 Article IV Consultation — Press Release; Staff Report; and Statement by the Executive Director for Czech Republic
IMF Staff Country Reports, January 30, 2024
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- Czech Republic: 2023 Article IV Consultation — Press Release; Staff Report; and Statement by the Executive Director for Czech Republic
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Bibliographic details
- Published: January 30, 2024
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400263705.002
Growth outlook and activity
- Economic activity slowed down notably in 2023.
- A rebound is expected in 2024, driven by a recovery in domestic demand.
- Growth in 2024 is expected to be led by consumption and fixed investment—as inflation fades and real income recovers—supported by net exports.
- Over the medium term, gross domestic product is not expected to reach the levels consistent with its pre-pandemic trend.
Inflation and monetary conditions
- Inflation peaked in 2022.
- Inflation is projected to meet its target by early 2025.
- Risks to inflation are tilted to the upside.
Risks and uncertainty
- Risks are tilted to the downside for activity.
- Risks are tilted to the upside for inflation.
- High uncertainty implies authorities should remain nimble in their policy responses.
Fiscal and macro-financial priorities
- Key policy priorities:
- Reducing inflation to target.
- Restoring fiscal space.
- Maintaining macro-financial stability.
- Emphasis on being responsive to evolving shocks given elevated uncertainty.
Structural challenges and reform priorities
- Structural shifts weighing on the medium-term outlook include population aging and a global shift away from fossil-fuel based power.
- Policy actions to boost potential growth:
- Aid labor and capital reallocation.
- Boost digitalization and productivity.
- Accelerate the green transformation.
International Monetary Fund. Czech Republic: 2023 Article IV Consultation; Press Release; Staff Report; and Statement by the Executive Director for Czech Republic.
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