Czech industrial production likely continued to rise in June on growing demand for cars

Czech industrial production is expected to have increased in June, thanks to foreign demand by cars. In the euro zone, car registrations are growth at a faster pace, while Czech car producers have stimulated output. However, other sectors have not been much successful.

The chemicals sector is being hit by the shuttering of two main refineries. Moreover, the sectors underpinning construction are under pressure, noted Societe Generale in a research report. A slump in public investment is leading to weakness in construction sector. The slump in public investment is because the inflow of EU money halted at the end of last year.

However, conditions remain tight in the labor market, while the jobless rate continues to be quite low and the number of vacancies increase. The jobless rate in July is expected to rise a bit because of seasonal factors only, as new graduates will enter the labor market.