Czech Banking Association ups 2025 GDP growth forecast, predicts higher inflation

The Czech Banking Association has raised its forecast for Czech economic growth this year to 2.1 percent, up from the 1.7 percent projected in May. The revision reflects stronger export performance and a weaker-than-expected impact of U.S. tariffs on the European Union, the association said in its latest macroeconomic outlook released Wednesday.

The Association likewise raised its forecast for average inflation this year to 2.5 percent, compared with 2.3 percent projected in May. It cited rising food and services prices as well as higher property costs. Real wages are expected to grow by 3.6 percent in 2025, but the average gross wage adjusted for inflation will only return to pre-pandemic levels next year. Real wages are not expected to reach their 2021 peak until 2027, the report said.