Czech consumer confidence declines in January as business sentiment edges higher

Confidence in the Czech economy remained broadly unchanged in January, with the overall confidence indicator holding at 100.2 points, the same level as in December, according to the Czech Statistical Office (ČSÚ). A modest improvement in business confidence was offset by a decline in consumer sentiment. Overall confidence remains slightly above its long-term average.

Analysts said the latest figures are consistent with expectations of continued economic growth in 2026 at a pace similar to last year.

“The aggregate confidence indicator does not suggest any reversal of the positive trend in individual sectors,” said Petr Dufek, chief economist at Creditas Bank. At the same time, he added, the data do not point to a surge in demand or inflationary pressures. “The January results are in line with economic growth of just over two percent expected this year.”

The business confidence indicator rose by 0.6 points month-on-month to 98.6 points in January, while consumer confidence fell by 2.8 points to 108.2 points.

Among businesses, confidence declined only in the construction sector, where it dropped by 4.7 points compared to December. In contrast, confidence increased in selected services by 1.3 points, in industry by 0.5 points and in trade by 0.3 points. According to Jiří Obst, head of the ČSÚ’s short-term surveys department, the slight improvement was supported by lower inventories in industry, a more positive assessment of the economic situation in retail, and higher demand in selected services.

Despite the improvement in business sentiment, analysts noted that the industrial sector continues to lag behind other parts of the economy. “Manufacturing companies are still struggling with weak demand,” said Miroslav Novák, chief analyst at Citfin. “While business confidence in construction and market services has generally increased over the past two years, confidence in industry has effectively stagnated.”

Consumer confidence weakened at the start of 2026, mainly due to growing concerns among households about the overall economic situation in the Czech Republic over the next 12 months. At the same time, a slightly higher share of households expects an improvement in their own financial situation. The proportion of respondents who assessed their current financial position as worse than a year ago also rose marginally. In addition, more households reported that they do not plan to make major purchases in the coming year.

The month-on-month decline in consumer confidence was stronger than expected, according to Vít Hradil, chief economist at Investika. He suggested that concerns about potential international trade tensions, including statements by US President Donald Trump on import tariffs, may have influenced respondents during the survey period.

Compared with January 2025, the overall confidence indicator, as well as both the business and consumer indicators, remain at higher levels.

Source: CTK