CBA Monitor is an interactive and quick overview of information on the development of the economy and the banking sector in the Czech Republic, accompanied by comments from CBA experts.
Economic commentary by Jaromír Šindel, Chief Economist of the CBA: CPI growth slowed to 2.5% yoy in August, but core inflation accelerated slightly to 2.8% in line with the CNB's forecast. The core services price segment, excluding imputed rent, accelerated month-on-month in August, but its three-month average remains well below the pace observed in H1-2025.
Economic commentary by Jaromír Šindel, Chief Economist of the CBA: Although the economy breathed a half-percent growth in the second quarter, the July figures were rather disappointing and suggest a cooling. However, the Czech economy is generating upside risks to inflation, which limits the room for manoeuvre of the CNB, which is likely to stick to the CNB's 3.5% terminal interest rate thesis. August's registered unemployment confirmed a worse trend, which, however, is not confirmed by other data.
The Czech Banking Association's forecast panel expects the domestic economy to grow by 2.1% this year. The estimate is more optimistic than the May forecast, which predicted only 1.7% for this year. The improvement comes despite the higher 15% US tariffs, which are expected to remain in place in 2026.
The Czech economy is expected to grow by 2.1% this year, while next year it should be a tenth less. The forecast is thus more optimistic than the May forecast, which only counted on 1.7% for this year. The improvement comes despite the higher 15% US tariffs, which are expected to remain in place in 2026.
August 2025: the CBA improved its outlook for the Czech economy. 2.1% growth confirms resilience and slightly higher inflation leads to a more cautious CNB
The CBA forecast is produced each quarter as a consensus forecast of selected domestic banks. A basic summary of the current CBA forecast in several figures and comments is outlined below, detailed information can be found in the
„CBA Forecast“ section.
GDP
0% yoy
year 2025 | 2026
The domestic economy is expected to accelerate to 2.1% this year and slow slightly to 2% y/y next year, but with a stronger momentum into next year. This comes after a 1.1% rise last year.
Unemployment
0%
year 2025 | 2026
We expect registered unemployment to rise slightly to 4.4% this year from 3.8% in 2024, with the expectation that it will stabilise at 4.4% next year, implying a slight improvement on current levels.
Average wages
0%
year 2025 | 2026
Growth in average nominal wages was expected to slow slightly to 6.2% from last year's 7.2% increase and further to 4.9% next year. This should result in real wage growth of 3.6% this year and 2.6% in 2026.
Inflation
0% yoy
year 2025 | 2026
Consumer prices are expected to rise by 2.5% year-on-year this year, almost repeating last year's performance of 2.4%, and we also expect only a further slight slowdown to 2.2% next year with slightly higher core inflation.
CNB 2-week repo rate
0%
end of 2025
According to the CBA's forecast panel, the CNB will commit to a cautious cut in the repo rate to 3.25% in 2026 after an unchanged level of 3.5% in the second half of this year. With this outlook, risks are skewed in both directions.
The Crown
0CZK/€
end of 2025
The interest rate differential remained supportive of a slight appreciation of the koruna compared with the previous forecast, also reflecting stronger prospects for export activity and easing uncertainty from trade wars.
Jaromír Šindel Chief Economist CBA
Jaromír Šindel is the Chief Economist of the Czech Banking Association, where he uses his extensive experience in the field of macroeconomic analysis and forecasting. Prior to that, he worked for more than 17 years as the Chief Economist at Citibank. In 1999 - 2004, he received a master’s degree from the University of Economics Prague with a major in economic policy and continued to focus on this field during his doctoral studies, which he completed in 2011.
During his time at Citibank (2007-2024), he worked mainly on macroeconomic analysis with a focus on economic trends in the Czech Republic, Slovakia and Slovenia. He prepared forecasts of economic developments and economic policy, including the impact on financial markets. Related to this, he also monitored global economic and political trends and their impact on the local economic situation.
