Non-shocking predictions for Czechia in 2026

  1. Russia will invade Estonia. The Chamber of Deputies and the Senate will support deploying the Czech Armed Forces, but will refuse to accept any refugees or provide any humanitarian aid. The Czech koruna will weaken only briefly, and only to 26.00 against the EUR.
  2. The subsequent easing of global geopolitical tensions will bring a further drop in oil prices, along with even greater pressure for sanctions on Russian oil. Despite persistently high refining margins, fuel prices will fall. The worsening fiscal situation in Czechia will force the government to raise excise duties on petrol, diesel, and LPG. Excise duty rates will reach historic highs. The government will use this as an intermediate step before introducing EU ETS 2. It will agree to EU ETS 2 at the European level in exchange for favorable terms for Czechia in obtaining state aid approval for all nuclear units at Dukovany and Temelín. The government will also introduce an excise duty on electric vehicle use, set at CZK 0.50 per kilometer.
  3. At least one credit rating agency will announce that it is placing the government's finances under review for a possible future downgrade of Czechia's credit rating. It will cite a significant deterioration in the outlook for Czechia's public debt, particularly in light of its assessment of the 2027 budget. We will still have a higher credit rating than France, Slovakia, Poland, Hungary, and Romania.
  4. Retail natural gas prices for delivery in 2027 will fall below CZK 1,000/MWh at all major suppliers, as wholesale prices drop below EUR 25/MWh. Including distribution charges and VAT, and adjusting for wage growth, prices will be significantly lower than at the beginning of the millennium. This will also dampen calls for a further postponement of the introduction of EU ETS 2.
  5. Inflation in Czechia will fall below 1% as unemployment continues to rise (due to a flood of underpriced Chinese products and the advance of foreign AI), the koruna remains relatively strong, the Czech National Bank (ČNB) eases monetary conditions only gradually, and all energy prices fall significantly compared with 2025. Brent crude will drop below USD 50 per barrel, bringing diesel prices in Czechia below CZK 30 per liter before the excise duty increase; annual electricity supply contracts will fall below CZK 2,000/MWh, and annual natural gas supply contracts below CZK 600/MWh. The incoming government will also fail to loosen fiscal policy significantly in time, with the effects beginning only in 2027. Wages will rise only in personal services and skilled trades. In industry and services most exposed to AI, real wages will see no growth. The ČNB will use these conditions to justify cutting interest rates below 3%.
  6. The unemployment rate will rise to 5% according to the Ministry of Labour and Social Affairs (MPSV), or 3.5% according to the Czech Statistical Office (ČSÚ) and the International Labour Organization (ILO). The main driver will be the advance of AI in the services sector. Prague will be particularly affected. The industrial downturn will have a less significant impact on the labor market.
  7. The government will scrap the high-speed rail (HSR) project entirely. It will do so quietly, but with the logical aim of reallocating public investment and future construction capacity to new nuclear units and planned motorways.
  8. The Czech government will seek to help the housing market. Housing prices in Prague and other promising large cities will continue to rise, and faster permitting will bring no relief. The government will resort to regulating mortgage interest margins. First, it will persuade the ČNB to issue a recommendation; later, it will invoke the Price Act. This will not solve the problem of high housing prices either. By stimulating demand, it will naturally push housing prices even higher. Developers will be the only beneficiaries.
  9. The government will seek to encourage investment, following the MAGA model, while also boosting the birth rate. Accordingly, starting January 1, 2027, every child born will receive CZK 100,000 deposited into a long-term investment product account.
  10. The government will introduce a voluntary register of gold and silver held by private individuals, in exchange for a reduced 12% VAT rate on new purchases of gold and silver. Note: gold purchases have not been subject to VAT until now.
  11. The annual trade deficit with China will exceed CZK 500 billion for the first time, despite significantly lower unit prices for imports from China as deflation takes hold there. Our car exports will decline again, while imports of cars from China will rise sharply. We will reduce our deficit in textiles and clothing. The Czech government will not initiate any measures targeting China at the European level, including any action concerning VAT.
  12. The number of births will fall below 70,000. This will amount to just one-fifth of the number of children born around the turn of the 20th century. Back then, however, 9.3 million people lived in what is now Czechia, compared with almost 11 million today. For the second time since 2002, Czechia will experience an overall population decline, as a substantial natural decrease will not be offset by migration. The government will introduce a new child benefit and increase childcare fees subsidies.

https://nazory.hn.cz/c1-67280210-dolar-za-20-korun-zestatneni-liberty-a-dalsi-ne-sokujici-predikce-pro-rok-2024

Disclaimer 1: The text is not intended to be entirely accurate or precise, but rather to draw attention to potential risks facing Czechia and Europe.

Disclaimer 2: The risks of an escalation of the war in Ukraine or an attempt to seize Taiwan are not factored in.

In Prague 28. 12. 2025