Daily economic news from the Czech Republic: Škoda Auto, Allvyn International, Tatra 815, Zuri flying taxi, bitcoin, Twisto, IMF (12 March 2025)

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Overview of the latest economic events in the Czech Republic

The government has completed the preparation of the Digital Tax Act, which will affect multinational technology companies operating on the Czech market from 2026. At the same time, a proposal to simplify administration for exporters, including a single digital form for customs procedures, was approved.

In the area of social policy, the Ministry of Labour announced a minimum wage increase of 7 % from July 2025 to offset inflationary pressures and boost consumer demand.

Škoda Auto saw its operating profit rise last year, while its parent company Volkswagen faced a decline. This result underlines Škoda Auto's strong market position and its ability to adapt to changing conditions in the automotive industry.

Allwyn International, which operates lotteries in the Czech Republic and other countries, reported a four per cent increase in adjusted gross operating profit to €1.55 billion. Total revenue rose 12 per cent to €8.79 billion, reflecting successful expansion and the growing popularity of lottery products.

After more than four decades, the production of the iconic Tatra 815 is coming to an end. The last car produced was a firefighter's special, symbolizing the conclusion of an era in the history of the Czech automotive industry.

Luxury real estate in the Czech Republic faces challenges in finding buyers. Price tags with eight zeros discourage potential buyers, suggesting the need to adapt supply to current market conditions and demand.

The year 2025 will bring 14 new car models to the market, among which Škoda Auto stands out with its innovations. This step strengthens the Czech carmaker's position on the global market and shows its commitment to keeping up with technological advances.

The Zuri flying taxi project has gained attention for its potential military applications. Investor Barta cites two examples of how this technology could be used in the defence sector, opening up new opportunities for the Czech technology industry.

In the past 24 hours, the Prague Stock Exchange recorded the following developments.

• PX Main Index: Slight increase of 0.3 %, reflecting the stable economic environment and positive corporate performance.
• Trading volume: Stable with a slight increase in activity in the technology sector.
• Sectoral trends: The technology sector strengthened on the back of positive news on innovation, while the energy sector remained stable.

The total volume of deals reached CZK 1.2 billion, with 45 % transactions going to the industrial sector. Investors showed increased interest in green bonds issued by the government to finance environmental projects.

The price of bitcoin has plunged nearly $30,000 from its peak, sparking concern among investors and speculators. This decline highlights the volatility of the cryptocurrency market and the need for caution when investing in digital assets.

Regulatory authorities have imposed record fines on energy suppliers and in some cases even revoked licenses. These measures are aimed at protecting consumers and ensuring transparency in the energy market.

Foreign investment

Internationally, the Czech company has recorded Skoda Auto significant success with the conclusion of a strategic cooperation with a German company for the development of electrical components for automobiles. This agreement will strengthen the Czech Republic's position in the European automotive industry and bring new job opportunities to the Moravian region.

Next Czech fintech startup Twisto has expanded into the Polish market with an innovative payment platform that combines instant repayments with algorithmic risk assessment. The move underlines the growing influence of Czech technology companies in Central Europe.

Czech energy company ČEZ announced the acquisition of a roughly one-fifth stake in Rolls-Royce SMR, a company specializing in small modular reactors. The move strengthens CEZ's position in the nuclear energy sector and represents a strategic investment in innovative technologies with potential for future energy projects.

Significant events outside the Czech Republic with global impact

The International Monetary Fund (IMF) has warned that slowing global trade growth poses a risk to the economies of Central Europe, including the Czech Republic. Countries such as the Czech Republic and Slovakia, which have a high ratio of exports to GDP, may be negatively affected by this trend. The IMF recommends implementing reforms aimed at increasing productivity, removing trade barriers within the EU and reducing costs for firms competing in foreign markets. Improving border infrastructure and harmonising public procurement rules could boost growth, especially in the services sector.

Automaker Nissan has announced management changes in response to poor economic results and failed merger talks with Honda. The restructuring is aimed at restoring the company's competitiveness in the global market.

GEVORKYAN, known for its powder metallurgy activities, continues its acquisition strategy across Europe. These acquisitions expand the company's product portfolio and strengthen its position in the European market. This trend reflects the growing interest in consolidation and expansion in the industrial sector.

European futures recorded a significant rise, indicating positive sentiment in the markets. These developments may influence the investment decisions and strategies of foreign investors targeting the European market, including the Czech Republic. Growing confidence in the European economy may encourage foreign capital inflows into the region.

Despite initial optimism about the possible removal of tariffs between the US and China, investors are abandoning hope for a quick solution. This uncertainty may affect global trade relations and, consequently, Czech exporters and investors. It is important for Czech companies to monitor the development of trade negotiations and prepare for possible impacts on their international activities.

Financial markets experienced significant fluctuations due to growing concerns about the US economy, possible changes to fiscal policy in Germany and signals of a more forceful policy response from China. These factors contributed to the decline in US equities, the fall in bond yields and the weakening of the dollar. Uncertainty related to tariffs and public sector cuts in the United States, along with possible fiscal easing in Germany and China's efforts to combat economic stagnation, present a mixed outlook for global growth. While there is optimism about accelerating growth in Europe and China offsetting slowing growth in the US, risks of stagflation remain.

The sharp decline in the US stock market, caused by fears of a recession, is forcing investors to consider reallocating capital. As US equities lose ground, foreign investors may withdraw funds and shift investments to other markets or asset classes, which may have an impact on the global financial environment. Large economies such as Europe and China are introducing policy measures to attract more investment amid these uncertainties.

World oil prices have declined to a three-year low, mainly due to weakening economic growth in China and globally, which has led to a reduction in demand. Benchmark oil prices have recently fallen to USD 68.33 per barrel and continue to trade below USD 70. Projections suggest that oil prices will be between USD 60 and USD 80 per barrel in the near future. In addition, global oil demand is expected to grow until the early 2030s, after which it is projected to decline as a result of the increased uptake of electric vehicles, although demand is expected to remain stable until 2040.

NYSE and NASDAQ (USA): both exchanges saw declines, influenced by recession fears and ongoing trade tensions.

London Stock Exchange (LSE): the LSE: recorded modest gains, benefiting investors looking for alternatives to the US markets.

Frankfurt DAX (Germany): (DAX): recorded a slight increase, probably due to expected changes in fiscal policy aimed at stimulating growth.

Asian markets: the Chinese markets remained relatively stable, while other Asian markets struggled with the downturn due to global economic uncertainty.

Current exchange rates according to the CNB and Google Rates

Source about precious metals and Bitcoin: tradingeconomics.com

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