Look for:

Our offer for

Research Detail

2018/08/02 / Erste Group Research

Special Report, Czech Republic: Czech economy would withstand fallout from US car tariff

If the introduction of car tariffs did not trigger a trade war, the Czech economy would withstand such a situation without any problems. Even trade wars would not cause any drama, only a greater slowdown in the growth of the Czech economy.

Negative impacts would be reflected first in exports and then gradually transmitted to the labor market and the development of domestic demand.

A 10% fall in demand would result in GDP growth being lower by around 0.2-0.3pp. If demand fell by 25%, the Czech economy would grow more slowly by about 0.6-0.7pp. In the case of trade wars, the impact on GDP growth would be roughly a negative 1.5-1.7pp.

At the current level of the EURCZK exchange rate, the risk induced by the introduction of tariffs is already largely captured. Of all possible scenarios, only significant deterioration in the world economy would have any major impact on the koruna exchange rate. Overall, we expect that the koruna will gradually return to a slowly strengthening trend, which will be supported by the increase in the CNB's rates.

PDF Download Download PDF (343kB)

General information

AuthorErste Group Research
Product nameCEE Economies Special Report
Topic in focusFX, Macro/ Fixed income
Economy in focusCzech Republic
Currency in focusCzech Koruna
Sector in focus-


We use cookies and web analysis software to give you the best possible experience on our website. By continuing to browse this website, you consent for these tools to be used. For more details and how to opt out of these, please read our Data protection policy.


Any information, material and services regarding financial instruments and securities provided by Česká spořitelna/Erste Group/ or any of its affiliates (collectively “Erste Group“) on this and any linked website hereafter (jointly the “Websites“) shall be exclusively to investors who are not subject to any legal sale or purchase restrictions.

By agreeing to this hereto, the visitor entering this Websites confirms that has read, understood and accepted this Information and the Disclaimer