Czech manufacturing performance deteriorated for a third month in June as new export business in the sector fell for an eight month running due to the ongoing crisis and uncertainty in Western European markets, an industry gauge published Monday showed.
The Czech National Bank (ČNB) has cut its key interest rate by a quarter of a point to a record low 0.5 percent, in line with market expectations, with months of sluggish domestic demand having sparked an economic recession.
Czech state bodies and institutions’ key financial statements will be used to calculate the debt and deficit of public finances. Such highly sensitive information helps the markets predict whether the state can meet its commitments — but not all the data are wholly reliable, the Supreme Audit Office (NKÚ) warns. Clear definitions of basic accounting concepts are missing, which can lead to different interpretations of these categories and thus incomparable data. Look to Greece to understand what that can mean.
The Czech Bank Association says that if passed proposed amendments to the law on budget rules will lead to the outflow of Kč 100 billion from commercial banks, resulting in them having less money to lend. One of the main aims of the legislation put forward by Finance Minister Miroslav Kalousek (TOP 09) and approved by the government last week is to reduce lending costs for state institutions.
Prime Minister Petr Nečas (Civic Democrats, ODS) has downplayed his government’s decision not to sign the EU fiscal discipline treaty. Speaking at the “Economic Interests of the Czech Republic in the EU” conference on Monday, the center-right politician also said he was working towards closer EU integration in the form of finalization of the single market — which he lamented was not completed decades ago.
Czech National Bank (ČNB) stress tests show the domestic banking sector is resilient to potential adverse shocks — such as a deeper recession in the European Union due to the eurozone debt cirsis — thanks to good capitalization, profitability and balance sheet liquidity, the central bank said in a report on Tuesday.
Zdeněk Tůma has been named to an advisory committee which should propose what reforms to make to the EU's banking sector. The advisory group has been put together to advise interventionist French Commissioner Michel Barnier, although Tůma has not been noted in the past for favoring too much central or local regulatory measures.
Exactly a year ago, Czech Position was the first publication to report on the scandal surrounding the Key Investments brokerage, which could be dubbed as the Czech equivalent of the Bernie Madoff case. While the US finance fraudster received a 150-year prison sentence, the main protagonists in the Czech scandal remain free — thanks to the level of morality and expertise in the Czech police and judiciary.
Arriving for the first day of talks at the summit of EU leaders, Czech Prime Minister Petr Nečas (Civic Democrats, ODS) made it known that he is unlikely to sign the EU agreement of budget and fiscal discipline if the Czech Republic, as a country without the euro, is granted limited access to negotiations on common economic policy and fiscal integration.
Speaking on a political talk show on Sunday, Czech Minister of Finance Miroslav Kalousek (TOP 09) appeared comparatively upbeat about the prospects for the Czech economy in 2012. At the beginning of January, Kalousek spoke of planning to adjust government spending plans to accommodate a 2 percent decline in growth; now his ministry forecasts growth of several tenths of a percent.