Key events:
• Korean stocks fell by 40 % in a single month
• The Fed will raise interest rates in September
• ČNB kept interest rates at 3,75 %
Summary of the current situation:
The summer months are usually uneventful on stock markets, but that certainly was not the case in July. Initially, stocks fell by several percent, particularly technology stocks. The S&P 500 index fell by as much as 5 %, and the technology-focused NASDAQ 100 was down by more than
12 % toward the end of July.
Semiconductor companies and companies linked to AI saw particularly steep declines. Their losses reached
tens of percent, with the largest decline on the Korean stock exchange (KOSPI), which fell by more than 40 % in a single month. However, strong earnings from big tech companies turned things around at the end of the month, and the S&P 500 index is now at new highs of around 7 700 USD.
Following its previous decline, oil began rising again during July and reached as high as 90 USD. However, it has been falling again over the past 2 weeks and is now trading at around 75 USD. The rise was driven by renewed escalation in the Strait of Hormuz, where the situation still appears not to have been fully resolved.
And how did other assets perform? Gold rose slightly and is currently trading at around 4 300 USD per troy ounce.
Bitcoin continues to trade within a range of 60 000 to 65 000 USD. Unlike stocks, which are
at their highs, it remains roughly 50 % below its peaks.
Macroeconomic summary:
Let us now turn to the key macroeconomic indicators, starting with the year-on-year inflation rate in the Czech Republic, which came in at 1,5 % for June. This marked a substantial decline below the 2% threshold. The decrease was primarily driven by falling fuel and goods prices. In contrast, prices for services and real estate continue to rise.
Another ČNB meeting took place on 6. 8. 2026, at which it kept interest rates at 3,75 % this time. All 7 members of the Bank Board voted to keep rates unchanged. Inflation has fallen below 2 % since the last meeting, and another rate increase may not be necessary for now.
The year-on-year inflation rate in the USA came in as high as 3,5 % for June due to persistently high oil prices. Inflation is expected to remain between 3 and 4 % in the coming months, and the Fed will probably raise interest rates.
At its latest meeting on 29. 7. 2026, the Fed kept interest rates at 3,75 % for the time being, but 3 of the 12 members voted for a rate increase. More members will probably vote for an increase in the future, pushing rates higher.
As for year-on-year inflation in Europe, the June figure came in at
2,8 %. It is expected to remain around the 3% mark in the coming months. Following its most recent increase, the ECB kept interest rates at 2,4 % at its meeting on 23. 7. 2026. However, it plans further interest rate increases in the coming months.
Czech Republic:
The year-on-year inflation rate in the Czech Republic came in at 1,5 % for June. This marked a substantial decline below the 2% threshold. The decrease was primarily driven by falling fuel and goods prices. In contrast, prices for services and real estate continue to rise.
Another ČNB meeting took place on 6. 8. 2026, at which it kept interest rates
at 3,75 % this time. All 7 members of the Bank Board voted to keep rates unchanged.
Source: cnb.cz
Inflation has fallen below 2 % since the last meeting, and another rate increase may not be necessary for now. This will depend on incoming data and developments in oil prices.
According to the hypoindex, the average mortgage interest rate remained at 5,32 % in July. However, reports of weakening demand for apartments are slowly beginning to emerge in the market, probably
also due to high mortgage interest rates. So far, however, there has certainly been no significant decline in real estate prices.
USA:
The year-on-year inflation rate in the USA came in as high as 3,5 % for June due to persistently high oil prices. Inflation is expected to remain between 3 and 4 % in the coming months, and the Fed will probably raise interest rates.
At its latest meeting on 29. 7. 2026, the Fed kept interest rates at 3,75 % for the time being, but 3 of the 12 members voted for a rate increase. More members will probably vote for an increase in the future, pushing rates higher.
Interest rate in the USA (current forecast)
There is currently an almost 80% probability that interest rates will indeed be raised to 3,75 % at the next meeting. The Fed is expected to continue raising rates next year as well. Everything will depend on oil prices and rising inflation.
The S&P 500 index fell by as much as 5 % during July, but ultimately ended at almost the same level as at the beginning of the month. It is currently even at new highs of around 7 700 USD.
Europe:
As for year-on-year inflation in Europe, the June figure came in at
2,8 %. It is expected to remain around the 3% mark in the coming months.
ECB interest rate – forecast
Source: www.www.tradingeconomics.org
Following its most recent increase, the ECB kept interest rates
at 2,4 % at its meeting on 23. 7. 2026. However, it plans further interest rate increases in the coming months. These could reach the 3% mark in 2027.
European stock indices rose slightly again during July. Specifically, the MSCI Europe index
gained as much as 1,61 % in dollar terms.
