Sunday, 19 October 2025
Czech producer prices showed a divided picture in September, suggesting that inflationary pressures are gradually easing but remain uneven across sectors. Agricultural costs lost momentum after a strong summer, industrial producers faced weaker demand, while construction and service prices continued to edge upward, driven by domestic activity and higher labour costs.
Agricultural producers experienced their first notable slowdown in several months. Prices fell compared with August, mainly due to cheaper vegetables, grains and oilseeds, while livestock and dairy prices offered partial support. Compared with last year, farm prices were still higher, though the pace of growth slowed considerably. Animal products, particularly eggs, milk and beef, remained significantly more expensive than a year earlier, while fresh vegetables and potatoes dropped sharply, highlighting how weather conditions and fluctuating consumer demand continue to influence the market.
Industrial prices also declined, reflecting a combination of softer global demand and easing energy costs. The biggest decreases came from the energy and chemical sectors, which have been under pressure from falling wholesale prices. Manufacturers of vehicles and food products saw smaller reductions. Compared with September 2024, producers were charging less for energy and raw materials but slightly more for food and building-related goods such as wood and non-metallic minerals. This divergence indicates that while energy-driven inflation has receded, other production costs remain sticky, keeping margins tight across the industrial sector.
Construction activity continued to display resilience, with work becoming slightly more expensive in September despite a modest dip in building material costs. The sector remains supported by renovation projects and public infrastructure spending, which have offset slower residential development. Builders continue to face higher labour expenses and logistical challenges, contributing to the steady rise in overall construction costs.
The strongest price growth came from the service sector, where business-related activities such as advertising, broadcasting and media surged. Double-digit monthly increases were reported in these categories, suggesting strong seasonal demand. Other professional services, including employment, accounting and legal support, also rose modestly, while transport and property-related services registered slight declines. Over the past year, services have been one of the most persistent sources of cost growth, driven by rising wages and the expanding role of technology and marketing in business operations.
Across the European Union, similar patterns were visible. According to Eurostat’s preliminary data for August, industrial producer prices declined across the EU, with the Czech Republic’s results broadly matching the regional trend. The Czech decline was smaller than in neighbouring Germany and Poland, pointing to a relatively stable industrial base despite subdued demand.
Overall, September’s figures suggest that the Czech economy is moving towards balance after several turbulent years, though the adjustment is uneven. Falling input costs in agriculture and manufacturing could help ease inflation in the months ahead, but construction and service sectors remain under upward pressure. Analysts believe that the key to sustaining this improvement lies in stable energy markets and continued moderation in global commodity prices.
As one Prague-based economist observed, “We’re no longer in a period of runaway costs, but this isn’t full relief either. The Czech economy is settling into a slower, more selective phase of adjustment where each sector tells its own story.”
Source: CZSO and Eurostat
