CFA/OVB Forecasting Survey 2010

Conducted in: 2010

The survey was conducted in connection with the Forecasting Dinner 2010. It is a prestigious annual meeting of members and candidates of the Czech CFA Society, which is for Chartered Financial Analysts, as well as leading domestic and foreign economists, for the purpose of predicting economic trends in the next year. This year’s Forecasting Dinner, the eighth, is again being held under the patronage of the governor of the Czech National Bank, Zdeněk Tůma.

The survey was done for the Czech CFA Society and its general partner, the financial advisory company OVB Allfinanz, by Donath-Burson-Marsteller, in co-operation with Factum Invenio between January 26 and February 4, 2010.

The survey’s aim was to map the opinions of economic and financial experts on key questions on trends in the world and the Czech economy.

The following received invitations to participate in the research:
Members and candidates of the Czech CFA Society;
OVB Allfinanz managers;
Leading Czech managers;
Selected economics journalists.

The questions concerned:
An assessment of the economic crisis and its impact on industries and regions;
Expected trends in key parameters of the Czech economy this year (including the outcome of the elections);
Acceptance of the Euro;
Personal bankruptcy, household indebtedness and pension reform.

Of the 886 people contacted, 347 respondents participated in the survey. The respondents’ attitudes on the various questions are given in this report below.

Main Findings

The opinion that the bottom of the crisis has been reached was prevalent among the respondents (the biggest optimists were the members and candidates of the Czech CFA Society – “CFA”). The sectors that come out of the crisis best should be finance, as well as power and utilities; the best-off regions should be China and also Southeast Asia.

The asset class with the best earnings in the Czech Republic this year should be equities (OVB Allfinanz managers – “OVB” – believed in them most). However, only just under a quarter of respondents expect more than ten percent growth in the Prague stock exchange’s PX index.

As far as concerns the results of the elections, the respondents see the ČSSD and ODS’ chances of victory as quite even (28 percent each). The third most expected result is then a grand coalition of both the strongest parties.

In comparison with last year’s research, there has been a shift in respondents’ opinions on whether the Euro would better protect the Czech economy in the crisis. Whereas a slight majority preferred the Euro last year, almost two thirds of respondents came down on the side of the Czech currency this year. The crown obtained the least support from the group of leading managers (“VIP”).

42 percent of respondents called entering the Eurozone a clear priority. Four percent of respondents want the Czech Republic to reject the Euro. As far as concerns the expected date of acceptance of the Euro, around 90 percent of respondents were divided almost equally between the options 2015, 2016 and “later.”

The fact that a quarter of respondents called the risk of bankruptcy of a Eurozone country “significant,” or even “dramatic,” is worthy of note.

In the field of household finance, 70 percent of respondents expect that the number of personal bankruptcies will increase significantly, or even dramatically. Respondents’ distrust of the current pension system is remarkable: not one of them thinks that the current government pensions system will be enough to guarantee them a dignified retirement.

Kontakt: Tomáš Jelínek

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