INSTANT VIEW 3-Czech Q3 GDP +1 pct q/q, Nov CPI touch above fcst

                                
 PRAGUE, Dec 9 (Reuters) - The Czech economy expanded by 1.0
percent in the third quarter from the previous three-month
period, just below a preliminary estimate of 1.1 percent, the
statistics bureau said on Thursday.
                                
 On annual basis, the economy rose by a real 2.8 percent
between July and September, a touch below a preliminary estimate
of 3.0 percent released on Nov. 12.
                                
 In other data, consumer prices rose 0.2 percent in November
from October, putting the annual inflation rate at 2.0 percent.
The annual growth was driven by an increase in manufacturing,
market services and trade, the stats office said.
                                
 The Czech year-on-year growth was worse than the growth in
neighbouring Slovakia, which posted a 3.8 percent year-on-year
rise in July-September and Poland's 4.2 percent year-on-year
growth. It was better than 1.7 percent growth in Hungary.
[ID:nBUD005637]
                                
 
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KEY POINTS (See details below comments):
CZECH Q3 GDP (pct)              Q/Q             YR/YR
 Real change                  1.0 (1.1)        2.8 (3.0)

CONSUMER INFLATION         Nov         Oct          Nov forecast
 pct change month/month    0.2        -0.2          0.1
 pct change year/year      2.0         2.0          1.9

                                
 COMMENTS:
                                
 DAVID MAREK, CHIEF ECONOMIST, PATRIA FINANCE
                                
 "Inflation surprised. It was moderately higher due to food
prices, which reacted to the growth in agricultural prices."
                                
 "Inflation at 2 percent is exactly on the central bank
target, so there is no reason to worry that there could be a
hasty rise in interest rates."
                                
 
                                
 PAVEL SOBISEK, CHIEF ECONOMIST, UNICREDIT PRAGUE:
                                
 "The drop versus the flash estimate was small and
corresponds to our expectations after yesterday's (quarterly)
current account data. The only reason of the revision was
probably the change in the balance of services and nothing more
significant happened."
                                
 "The structure of growth did not change much from the
pervious period. Domestic demand (was solid). There is a decline
in the contribution of foreign trade to GDP growth or the
contribution could possibly be negative."
                                
 
CENTRAL BANK FORECAST: The central bank had forecast 
third-quarter GDP growth of 2.7 percent in its most recent
projection in November. In its quarterly forecast, it also saw
November annual inflation at 2.1 percent, while analysts in a
Reuters poll saw it at 1.9 percent.
                                
 The bank cut interest rates to a record low of 0.75 percent
on May 6.

 Details of Q3 GDP data..........................[ID:nPRA005368]
 Details of November inflation data..............[ID:nPRA005369]

DETAILS:
GROSS DOMESTC PRODUCT:
- On the supply side in the year-on-year comparison, gross added
value grew by 3.7 percent mainly thanks to a 10.7 percent rise
in manufacturing, a 7.0 percent rise in market services and a
5.3 percent rise in trade.
- Manufacturing was driven by the automotive industry, machinery
and production of electrical and optical devices.
- In the quarter-on-quarter comparison, gross added value rose
by 1.5 percent, including a 6.6 percent rise in trade and a 4.5
percent rise in manufacturing.
- On the supply side, capital formation and a rise in
inventories were key.
- Final consumption expenditures rose by 0.7 percent year on
year and contributed to GDP growth by 0.5 percentage points.
- Gross capital formation rose by 14.4 percent and contributed
3.1 percentage points to GDP growth.
- The foreign trade balance fell by 22.9 billion crowns from the
same period last year due to worsening in terms of trade.

INFLATION:
- Monthly consumer price growth was mainly due to a rise in food
prices and the prices of non-alcoholic beverages.
- Prices of vegetables rose by and a 4.8 percent and prices of
fruits were up 4.8 percent.

 BACKGROUND:
- Market expectations before release             [ID:nLDE6B1197]
- Slovak Q3 GDP..................................[ID:nLDE6B10OH]
- Poland's Q3 GDP................................[ID:nLDE6AT0SD]
- Hungary's Q3 GDP...............................[ID:nBUD005637]
- Report on last Czech c.bank rate decision......[ID:nLDE6A31FW]
                                
              [ID:nLDE6A31R0] [ID:nPRA005309] [ID:nPRG004479]

LINKS:
- For further details on third quarter GDP and May other past
inflation data, Reuters 3000 Xtra users can click on the Czech
Statistical Bureau's website:
                                
 http://www.czso.cz/eng/csu.nsf/kalendar/2004-hdp

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