PRAGUE, May 4 (Reuters) - The Czech central state budget
showed a 55.66 billion crown ($2.77 billion) deficit for
January-April, wider than a 28.09 billion deficit a year ago and
above a full-year target of 38.1 billion, data showed on Monday.
The Finance Ministry said the worsening of the deficit was
mainly due to a quarterly payment to regional schools, along
with state subsidies toward savings in building societies and
interest payments on state debt.
****************************************************************
KEY POINTS:
(in CZK bln) 01-04/09 01-03/09 01-04/08
year-to-date balance -55.66 -2.35 -28.09
(For full table, double click on................[]
MARKET REACTION:
The Czech crown <EURCZK=> was unchanged at 26.600 to the
euro by 1257 GMT.
COMMENTARY:
DAVID NAVRATIL, CHIEF ANALYST, CESKA SPORITELNA
"We expect... around a 150 billion crown deficit (this
year), so it's developing as we forecast."
"The risks are on the downside, because our forecast is
based on Germany declining 3 percent; so as consensus is moving
(worse) we are already looking at alternatives."
"Germany is the biggest risk (for the Czech budget
outlook)."
DAVID MAREK, CHIEF ECONOMIST, PATRIA FINANCE
"It's only a mirror of the economic situation in the Czech
Republic. So if the economic forecasts get darker and darker,
then budget figures can only confirm it is worse and worse."
"It can confirm the budget deficit is going close to 5
percent of gross domestic product by the end of this year. This
is on the edge of tolerance of financial markets."
"We can see the recession is worsening public finances, so
we can't add any expenditures or stimulus packages to burden
public finances wider. It's a message to the next government to
be cautious with creating next year's budget."
BACKGROUND:
- January-April revenue was down 2.1 percent year-on-year, while
expenditure rose 5.4 percent.
- January-April revenue accounts for 30.6 percent of the annual
target. Overall expenditure for the period stands at 34.5
percent of the yearly plan.
- Tax and fee revenues unexpectedly fell by 9.9 percent
year-on-year, mainly due to lower income from corporate,
personal income and excise taxes.
- Revenue from social insurance is 30.6 percent of the budget,
while social payments from the budget are 36.6 percent.
- The full-year 2009 central state 2009 budget sees a 38.1
billion crown deficit on expenditure of 1,152 billion crowns.
However, Finance Minister Miroslav Kalousek has said the deficit
would widen to 150 billion crowns this year, and that would
still require savings.
- The central state budget is the biggest part of the overall
public finances.
- In its latest forecast released last week the finance ministry
saw an overall public sector deficit of 4.5 percent of gross
domestic product (GDP) in 2009 under the EU-harmonised ESA-95
fiscal rules.
LINKS:
- For recent stories on the budget, click on []
or [].
- For an overview of the Czech central government budget,
Reuters 3000 Xtra users can click on the ministry's website:
http://www.mfcr.cz
- For LIVE Czech economic data releases, click on <ECONCZ>
- Instant Views on other Czech data []
- Overview of Czech macroeconomic indicators []
- Key data releases in central Europe []
- For Czech money markets data click on <CZKVIEW>
- Czech money guide <CZK/1>
- Czech benchmark state bond prices <0#CZBMK=>
- Czech forward money market rates <CZKFRA>
(Writing by Jason Hovet)
