While external demand is at risk, internal demand dominates. The tense labour market supports household consumption. The unemployment rate has hit record lows; by the ILO methodology it dropped under 2% in November, net of seasonal factors. On the contrary, wages are surging: they rose by a strong 8.5% last year, the fastest over the past 17 years. Since growth in productivity is lagging behind and companies are facing the risk of their lower competitiveness in terms of prices, they have to invest. And indeed, investments were the main driver of the Czech economy last year when public sector investments joined the private sector in the second half of the year. Internal demand will continue to be the factor supporting the Czech economy’s growth this year again but further acceleration is unlikely. Czech producers will face additional pressures on their profit margins and although wages will rise at a slower pace, it will still be a strong 6.9%. This is compounded by the uncertainties concerning external demand while for the public sector the main wave of EU funded projects ended in 2018. Thus, investments will improve by 2.2% this year after last year’s 9.0%.