Survey of macroeconomic forecasts - May 2010

Dept 37 - Economic Policy Department
Dept 37 - Economic Policy Department

Published

  • Macroeconomic Forecast
  • Survey

Macroeconomic forecasts' survey

Macroeconomic frameworks of the State Budget and Budgetary Outlook and MoF forecasts are regularly compared with results of macroeconomic indicators survey among important relevant institutions (the so-called Colloquium), last round of which took place in May 2010. Outcomes of the 29th round of survey are based on forecasts of 15 domestic institutions (Cyrrus, CNB, Česká spořitelna, ČSOB, Czech Chamber of Commerce, Komerční banka, MoF, Ministry of Labour and Social Affairs, Patria, PPF, Raiffeisen, Union of Czech and Moravian Production Co-operatives, UniCredit, Wood & Company). To make the survey more representative, forecasts of two international institutions were added (European Commission, IMF).

The Colloquium’s aim was to get an idea on opinions regarding assumed development of our economy and to assess jointly key tendencies within the horizon of years 2010 through 2013, with years 2012 and 2013 seen as indicative outlook. The key indicators and current MoF forecast are summed up in Tables 1 and 2.

In general it can be summed up that, with minor exceptions, MoF forecasts do not differ considerably from average of other institutions’ forecasts.

  2010 2011
min. consensus max. MoF CR min. consensus max. MoF CR
Gross domestic product increase in %, const.pr. 0,8 1,5 1,9 1,5 1,7 2,4 3,1 2,4
Consumption of households increase in %, const.pr. -1,5 -0,6 0,7 -1,1 0,3 1,4 2,8 2,0
Consumption of government increase in %, const.pr. -3,0 -0,2 5,2 -2,5 -1,8 0,5 5,1 -0,9
Fixed capital formation increase in %, const.pr. -6,5 -1,9 3,0 -3,7 -3,2 2,0 4,5 2,5
Inflation rate per cent 1,4 1,6 2,0 1,5 1,8 2,1 2,9 2,3
GDP deflator increase in %, const.pr. -2,1 0,4 1,5 0,2 0,6 1,8 2,7 1,1
Employment increase in per cent -2,4 -1,5 -0,6 -0,6 -2,2 0,1 1,0 0,1
Unemployment rate average in per cent 7,4 8,4 9,5 7,9 7,2 8,2 9,2 7,8
Wage Bill (domestic concept) increase in %, curr.pr. -2,0 0,1 3,0 -0,1 -0,5 2,7 5,3 4,3
Current account / GDP per cent -2,1 -0,8 0,4 0,4 -2,4 -1,1 1,0 -0,5
Crude oil Brent USD / barrel 75 81 85 81 75 88 105 92
Table 1: Results of Survey for Years 2010 and 2011

 

  2012 2013
min. consensus max. min. consensus max.
Gross domestic product increase in %, const.pr. 1,9 3,2 4,2 2,1 3,3 4,4
Consumption of households increase in %, const.pr. 1,2 2,3 4,0 1,3 2,7 4,0
Consumption of government increase in %, const.pr. -0,7 1,1 5,1 -1,0 1,9 5,1
Fixed capital formation increase in %, const.pr. -0,5 3,0 5,0 0,6 3,3 6,4
Inflation rate per cent 1,9 2,3 2,8 1,9 2,4 2,9
GDP deflator increase in %, const.pr. 1,5 2,2 2,9 1,5 2,6 3,6
Employment increase in per cent -1,9 0,4 1,8 -1,9 0,5 1,8
Unemployment rate average in per cent 6,7 7,8 9,0 6,4 7,1 7,5
Wage Bill (domestic concept) increase in %, curr.pr. -0,4 3,0 6,8 -0,4 3,7 7,4
Current account / GDP per cent -1,7 -1,2 0,5 -2,0 -1,0 0,5
Crude oil Brent USD / barrel 80 93 108 80 101 110
Table 2: Results of Survey for Years 2012 and 2013
Sources of tables: Survey respondents, MoF calculations

Main tendencies of macroeconomic developments can be summed up as follows:

  • On average, institutions expect that GDP growth will reach 1.5 % in 2010. For 2011 growth is expected to accelerate to 2.4 %. MoF forecast for both years corresponds fully to the consensus forecast. Outlook for years 2012 and 2013 then allows for roughly 3 % growth of the economy.
  • Within entire forecast horizon, average rate of inflation should stick to low levels, close to CNB’s inflation target. The MoF forecast is in accordance with forecasts’ average.
  • According to consensus forecast, decline in employment and rise in unemployment rate should continue in this year. In 2011 employment should increase marginally by 0.1 %, with unemployment rate falling moderately. Such tendencies (growth of employment, fall in unemployment rate) should prevail on the labour market also in 2012 and 2013 according to forecasts’ average, which is in accordance with MoF estimate.
  • Current forecasts allow for decline in wage bill (in current prices) to stop as soon as this year. In 2011 this indicator should rise by 2.7 %, which is by 1.6 p.p. less than forecast by the MoF. Outlook for 2012 and 2013 allows for further acceleration of growth dynamics, which nevertheless should not reach the pre-2009 level.

The next Colloquium will take place in November 2010.

List of indicators:
Graphic presentation of past and assumed developments of individual indicators is seen in graphs 1–19. For the sake of comparison, also consensus forecasts of two previous Colloquiums are included. Extreme forecasts of indicators (min. and max. columns in the tables) form thresholds of the highlighted area.

 

Graph 1: Gross domestic product of EA12 countries
Graph 2: Price of Brent oil
Graph 3: Short-term interest rates
Graph 4: Long-term interest rates
Graph 5: CZK/EUR exchange rate
Graph 6: USD/EUR exchange rate
Graph 7: Gross domestic product
Graph 8: Consumption of households
Graph 9: Consumption of government
Graph 10: Gross fixed capital formation
Graph 11: GDP deflator
Graph 12: Consumer prices
Graph 13: Employment (LFS)
Graph 14: Unemployment rate (LFS)
Graph 15: Total wage bill (domestic concept)
Graph 16: Trade balance
Graph 17: Balance of services
Graph 18: Balance of income
Graph 19: Balance of payments – current account

 

Graph 1: Gross domestic product of EA12 countries
Real growth in %


Steep decline replaced by fragile recovery, GDP growth should not exceed 2 % in 2013

 

Graph 2: Price of Brent oil
USD/barrel

Slow growth of oil price to the level of USD 100 per barrel in 2013 is expected 

 

Graph 3: Short-term interest rates
% p. a.

The path of short-term interest rates reflects past and expected changes in CNB rates in response to the development of inflation pressures 

 

Graph 4: Long-term interest rates
% p. a.

Compared to the past colloquium, further considerable cuts in outlook, nevertheless tendency to growth due to higher supply of government bonds and expected growth of short-term rates remains 

 

Graph 5: CZK/EUR exchange rate

After considerable strengthening and follow-up correction, return to appreciation trend is expected 

 

Graph 6: USD/EUR exchange rate

State of public finance of some Euro Area countries impacts on the euro’s exchange rate  

 

Graph 7: Gross domestic product
Real growth in %

After an unprecedented decline in GDP, slight recovery should be recorded this year with acceleration of growth above 3 % in 2012; estimates remain stable

 

Graph 8: Consumption of households
Real growth in %

Due to fiscal consolidation and labour market situation, deepening of decline in 2010, then recovery of growth dynamics 

 

Graph 9: Consumption of government
Real growth in %

After stagnation in 2010, only moderate growth of government consumption, nevertheless large variance of estimates  

 

Graph 10: Gross fixed capital formation
Real growth in %

Ongoing decline in investment activity, return to growth is expected on average in the next year 

 

Graph 11: GDP deflator
Growth in %

 Growth of GDP deflator slightly below 3 % in 2013 

 

Graph 12: Consumer prices
Average rate of inflation in %

Within the forecast horizon, growth of consumer prices to hover within the tolerance band of CNB inflation target 

 

Graph 13: Employment (LFS)
Growth in %

Further fall in employment this year, slow growth in the following years  

 

Graph 14: Unemployment rate (LFS)
In %

Unemployment rate should peak in 2010 

 

Graph 15: Total wage bill (domestic concept)
Nominal growth in %

Past year’s decrease in wage bill should be replaced by stagnation this year and then recovery of growth dynamics  

 

Graph 16: Trade balance
fob-fob – BoP, CZK bn

A considerable surplus of trade balance is expected 

 

 

Graph 17: Balance of services
CZK bn


Surplus of balance of services should show tendency to moderate growth

 

 

Graph 18: Balance of income
CZK bn

Balance of income deficit to fluctuate in relatively narrow band 

  

Graph 19: Balance of payments – current account
% of GDP

Current account deficit remaining on a sustainable level