INSTANT VIEW 4-Czech Sept PPI -0.1 pct month-on-month

                                
 PRAGUE, Oct 14 (Reuters) - Czech industrial producer prices
dipped 0.1 percent in September from August, faster than market
forecasts, putting the annual rate at 5.5 percent, from August's
5.7 percent.
                                
 The statistics bureau said agricultural producer prices
dipped 6.1 percent in September on the month, for a 4.4 percent
year-on-year drop, decelerating from August's 6.3 percent rise.
****************************************************************
KEY POINTS:
(change in percent)       Sept       Aug       Sept forecast
 PPI
 month/month             -0.1        0.4        0.0
 year/year                5.5        5.7        5.6

(For full table of data........................[ID:nPRA002169])

- The monthly decline in the producer price index (PPI) was led
by a 1.9 percent drop in refining and coke prices.
- Food and tobacco prices dipped 0.3 percent on the month.
                                
 
                                
 COMMENTS
                                
 
                                
 MICHAL BROZKA, ANALYST, RAIFFEISENBANK            
                                
 "The overall view of producer prices shows a disinflationary
trend -- prices in agriculture are lower... year on year, which
should later show in the prices of food."
                                
 
                                
 MARTIN LOBOTKA, ANALYST, CESKA SPORITELNA
                                
 "(Agricultural prices) are in line with the good harvest.
This is a tendency we see continuing. Inflation would have
fallen anyways... On top of this we have falling agricultural
products which is going to put inflation below what would have
normally been the case."
                                
 "Right now, I don't think inflation is going to be such a
strong factor in the board's thinking about monetary policy. I
think the growth prospects have deteriorated to the point where
inflation risks are going to take a back seat to growth risks."
                                
 
                                
 DAVID MAREK, CHIEF ECONOMIST, PATRIA FINANCE       
                                
 "The developments of both industrial and agricultural prices
are favourable news for consumers and financial markets."
                                
 "Hopes for reduction in interest rates are strengthening and
it seems very likely that it will take place in the beginning of
November."
                                
 "The question will be whether it will be (a cut by) 25 or 50
basis points."
                                
 
                                
 JAN VEJMELEK, HEAD OF ECONOMIC RESEARCH, KOMERCNI BANKA
                                
 "It is the beginning of a trend that should show more
significantly in the coming months as commodity prices fall.
Combined with weakening demand, (inflation) should slow."
"The dramatic decline in agriculture prices was a surprise,
and it will help squash overall inflation which was triggered by
rising food prices."
                                
 
BACKGROUND:
- Industrial PPI and agriculture producer prices are watched
closely by the markets as leading indicators for consumer
inflation, which is targeted by the Czech central bank (CNB).

- September consumer inflation                    [ID:nL8621385]
                                
                                               [ID:nL3432685]
- August industrial output figures                [ID:nL9249870]
- Report on last Czech c.bank rate decision.......[ID:nLP705205]
                                
                              [ID:nPRA002139] [ID:nPRG001022]

LINKS:
- For further details on September producer prices and past
data, Reuters 3000 Xtra users can click on the statistical
bureau's Website:
                                
 http://www.czso.cz/eng/csu.nsf/kalendar/2004-ipc

- For LIVE Czech economic data releases, click on       <ECONCZ>
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 (Writing by Jana Mlcochova; Editing by Michael Winfrey)