The IMF Country Reports Series covers economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with officials of the country, is published at the option of the member.
This paper describes economic developments in the Czech Republic during 1990-95. In 1991-93, quick progress was made in containing inflation, rebuilding foreign reserves, and restoring confidence in economic policies; and this was followed by resumption of growth in 1994. Financial and political stability and continued progress toward a market economy attracted large capital inflows in 1993-95. In spite of attempts to sterilize these inflows, monetary growth was rapid and fueled a boom in domestic demand, which in turn widened the current account deficit and maintained inflation at relatively high levels.