Czech economy contracts for third straight quarter as austerity dampens growth.

By bne IntelliNews May 16, 2012
The Czech economy contracted for the third straight quarter in Q1 as the governments austerity measures aimed at cutting the gap to fit within the EUs limit of 3% of GDP overweighed foreign demand, flash estimates from the statistics office showed. After contracting by 0.1% q/q in the last two quarters of 2011, the Czech GDP shrank by 1% q/q in Q1 2012, registering its steepest fall since Q2 2009. The figures surprised analysts, most of whom expected the economy to expand by 0.1% or at least stagnate in the first three months of 2012. In annual terms, the GDP also contracted by 1%, following a 0.6% y/y rise in the fourth quarter of 2011. The statistics office said the fall in GDP was the result of lower gross value added in the financial and insurance sectors and lower collection from excise taxes on tobacco products. The office will publish detailed GDP data on June 8, 2012.
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