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Morning Summary: Czech Deficit To Reach 8.8% of GDP in 2021

CZECHIA
  • Covid cases have stabilized around 4,000 after falling by 8,000 in the past 6 weeks, and are currently at their lowest level since early December.
  • As yields have stabilized across central Europe, Czech government sold more bonds than originally planned amid surging demand. The gvt placed 21bn CZK of debt on Wednesday, exceeding the auction's target of 14bn. With the 10Y yield trading at a premium of 225bps to the German Bunds, investors seeking higher returns have been piling into Czech debt despite the country's record borrowing plans CZK (BBG).
  • According to the Ministry of Finance latest forecasts, government sees GDP growth at 3.1% in 2021 and 3.7% in 2022. in addition, Czech R. is expected to run a deficit of 8.8% of GDP in 2021, up from 6.2% last year. The gap is then expected to fall to 5.9% in 2022.
  • At 9.30am (London time), PM Andrej Babis is expected to comment on outlook for lockdown easing and government changes (BBG).
  • There are no important economic data to watch today.

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