Economy falls by 5.5 percent year on year but shows signs of recovery

The Czech Republic’s gross domestic product fell by 5.5 percent year on year in the second quarter of 2009, according to revised government figures released on Tuesday. That is the largest quarterly decrease year-on-year in the country’s history, and one percentage point higher than a forecast from the Czech central bank. But the economy has also shown some slight signs of recovery, as it rose by 0.1 percent compared to the first quarter of this year. The biggest factor behind the plunge is the decrease in manufacturing industry output, which fell by 12.8 percent. Analysts believe that increased government spending in the second quarter of 2009 prevented an even greater fall in GDP.