February 13, 2019 / 2:48 PM / 6 months ago

Czech economy could slow up to 1 pct point in no-deal Brexit -c.bank

PRAGUE, Feb 13 (Reuters) - The Czech economy could slow by up to 1 percentage point in 2019 if Britain were to leave the European Union without a deal, Czech National Bank (CNB) Vice-Governor Tomas Nidetzky said on Wednesday.

The drag on growth could reach 0.50 to 0.75 percentage points in 2020, according to the bank’s sensitivity scenario, Nidetzky told tabloid Blesk’s online TV channel in an interview. He said the main impact would be felt indirectly through a cooling in Germany, the main Czech trade partner.

“The direct impact on the Czech Republic from trade relations with the UK would not be so significant,” Nidetzky said in the live interview.

“The indirect impact would be much more significant, the impact on the German and consequently the Czech economy. Our sensitivity scenario works with an impact of 1 percentage point into gross domestic product dynamic this year and 0.5-0.75 percentage points next year.”

The central bank’s outlook sees growth reaching 2.9 percent in 2019 and 3.0 percent next year. (Reporting by Jan Lopatka and Jason Hovet)

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