Prague - Slower, but still quite fast. That's how the Czech economy was growing in the first quarter of 2008.
According to provisional estimates, the gross domestic product has grown by 5.4 percent, compared with last year.
Since the last quarter of 2007, Czech GDP has grown by 0.9 percent.
The data was produced by the Czech Statistical Office (ČSÚ).
"In the first quarter of the year, one third of the economic growth was composed of higher employment, and two thirds can be assigned to growth of overall productivity," informed the ČSÚ.
"After the data on Czech industry and foreign trade was presented earlier, it became clear that the outcome will be weaker. Growth of 5.4 percent should thus not be a surprise. Price growth reduces households' consumption, foreign trade is slowing down but exchange rates are helping out. Government spending that significantly helped in the fourth quarter of 2007 was probably weaker in the first quarter of 2008," commented Michal Brožka, from Raiffeisenbank.
Read more: Consumer prices increase reaches 7 percent
Last year the best result in history
Last year, Czech economy has grown by 6.5 percent, which is the best result in the history of the independent Czech Republic.
Economic prosperity also projected itself on employment, which grew in the last quarter of 2007 by 1.9 percent.
GDP growth in the last quarter of 2007 was 6.6 percent. "The economy was growing faster than was expected and the growth was perfectly balanced," explained Helena Horská, an analyst at Raiffeisenbank.
Not only consumption, but investments and foreign trade grew as well. These good results were caused above all by the gross added value, which rose by 6.4 percent. Another source of economic growth was also the increase of production tax.
The employment growth is another thing that was behind the economic development.
Second place in Central Europe after Slovakia
The economy was growing with the fastest rate since 1996.
"As for this year, we are however expecting the rate of growth to slow down under five percent and the rate of household consumption growth rate to decelerate too. Investments and foreign trade will maintain their fine tempo," added Horská.
In Central and Eastern Europe, the Czech Republic is retaining its second place after the skyrocketing Slovakia.
With its 6.1 percent growth in the last quarter of 2007, Poland is in third place.