The OECD released its new Economic Outlook. There is now expected a higher GDP growth than previously for the Czech republic. This year, GDP should increase by 2.5%, 3.3% in 2001 and 3.2% in 2002. Inflation will reach 4.0% this year, 4.3% in 2001 and 4.4% in 2002 according to the OECD forecasts. The main message of the OECD report became a warning to growing public finance deficits. Thus the OECD joined to the EU Commission and the EBRD in the identification of the main threats of the further economic development in the Czech Republic. The deficit of the public finance budget should rise to 7.7% of GDP this year, 6.5% in 2001 and 7.5% in 2002.
Preliminary bids for buying the state stake in Komerční banka will be reviewed by the steering committee.
The Czech koruna firmed slightly against the euro. The koruna closed at 34.70 on Monday from 34.71 at the open. The koruna dipped to 40.84 against the US dollar from Thursday’s 40.61.
Bond trading was very quiet on Monday. The market seemed to be waiting for trade balance figures to be released on Tuesday. We predict the number to be -10.0 bil. CZK, which is likely to sent prices bit lower.
Current benchmark prices: MoF 6.75/05 98.75-05 (unchanged), MoF 6.30/07 93.50-80 (unchanged), MoF 6.40/10 91.50-80 (unchanged).