Car production in the Czech Republic for April fell by 80% Year-on-Year which was way more than expected! You may be thinking why is April’s data relevant now? That’s because industrial data generally takes a month to collect and standardize before it is released. Cars make up 20% of Czech’s GDP, and its shows as the 10Y Czech benchmark bond has sold-off 30bps since the start of April and 80bps since March. 14,500 cars were produced in April vs. a monthly average of 120,000. This is not expected to improve significantly until Toyota and Peugeot factories re-open.
20% of the GDP = alot of people without jobs right now, which highlights the impact that close of business is having on the Eurozone economy. However, this begs the question, austerity measures are inevitable but when will they kick in ?