INSTANT VIEW 4-Czech June trade surplus much bigger than fcast

                                
 PRAGUE, Aug 4 (Reuters) - The Czech foreign trade balance
posted a much larger-than-expected 13.9 billion czech crown
($905.3 million) surplus in June, data showed on Monday.
**************************************************************
KEY POINTS:
(in bln CZK)           June        May          June fcast
 balance              13.92        9.22          9.30
(nominal y/y change in pct)
 exports               1.7         0.0           n/a
 imports              -1.0        -2.0           n/a

 (For full table of trade data, click on........[nPRA002055])

- According to seasonally-adjusted preliminary data, exports
rose 1.3 percent in June from May, while imports rose 2.0
percent month-on-month.
- In euro terms, exports and imports rose 19.4 percent and 16.2
percent, respectively year-on-year in June, outpacing the
dynamics in crowns, thanks to the firming of the domestic
currency.
- Export in trade with vehicles and machinery rose by 0.8
percent year-on-year, import dipped by 5.6 percent year-on-year.
                                
 
                                
 COMMENTS:
                                
 RADOMIR JAC, CHIEF ANALYST, GENERALI PPF ASSET MANAGEMENT
                                
 "The overall surplus is much better than expected but the
cooling dynamics of exports and imports indicate that the
overall activity in Czech economy has been slowing." 
                                
 "However, it looks that foreign trade had a very positive
contribution to GDP growth in the second quarter." 
                                
 "We still expect full-year surplus roughly at CZK 90
billion, although there is possibility of even somewhat stronger
surplus. Overall, one may take both good news (a strong surplus)
and bad news (relatively weak export / import dynamics) from the
June numbers and reaction of the Czech crown should be therefore
muted. The market is waiting for the central bank board meeting,
which should provide the Czech crown the major impetus for the
weeks to come."
                                
 
                                
 DAVID MAREK, CHIEF ECONOMIST, PATRIA FINANCE
                                
 "The foreign trade result beat expecations and confirms that
the crown is a two-edged sword."
                                
 "In the first half of the year, the balance has improved
visually because import prices fell. Nevertheless, sooner or
later real economic negative impacts will begin to show, and
they may be a reason for the Czech national bank to cut interest
rates.
                                
 
                                
 VOJTECH BENDA, SENIOR ECONOMIST, ING WHOLESALE BANKING
                                
 "The goood news is the trade balance surplus improved
compared with the same month last year."
                                
 "The bad news is this has happened mainly due to dampened
imports of capital goods. This is not a very positive indicator
of a investment demand growth, which will likely remain subdued
in the reminder of the year." 
                                
 
                                
 PETR DUFEK, ANALYST, CESKOSLOVENSKA OBCHODNI BANKA
                                
 "Foreign trade turned out better than our optmisitic
forecasts. I see as especially positive the export growth in
crown terms, and that was in spite of the strong crown and
expensive commodities.
                                
 "In all, the effects of the strong crown has yet to be seen
in the aggregated figures. I expect that foreign trade in the
second quarter has visibly supported economic growth."
                                
 
                                
 BACKGROUND:
- Market expectations before release              [ID:nL9319630]
- Slovak May trade figures                        [ID:nL1191750]
- Report on last Czech c.bank rate decision      [ID:nL26205513]
                                
              [ID:nPRA001993] [ID:nPRG000874] [ID:nPRG000885]

- For further details on June foreign trade and other past data,
Reuters 3000 Xtra users can click on the Czech Statistical
Bureau's website:
                                
 http://www.czso.cz/eng/csu.nsf/kalendar/2004-vzo

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 (Reporting by Mirka Krufova; Editing by Michael Winfrey)