INSTANT VIEW 2-Czech June C/A deficit broadly in line with fcast

                                
 PRAGUE, Aug 11 (Reuters) - The Czech current account showed
a 15.01 billion crown ($796.7 million) deficit in June, broadly
in line with market expectations, due to dividends being
repatriated by foreign investors in Czech firms.
                                
 Analysts in a Reuters poll had forecast a 14.6 billion crown
shortfall. The Czech central bank data showed dividend payments
amounted to 14.5 billion crowns in June.
                                
 The rolling 12-month deficit narrowed to 41.8 billion
crowns, equal to about 1.13 percent of estimated 2010 gross
domestic product, according to Reuters calculations.
                                
 
****************************************************************
KEY POINTS:
(CZK billions)           June          May          June fcast
Current Account         -15.01        -23.98        -14.6
Financial Account        28.06         36.37          n/a
Net Direct Investment     6.34          7.67          n/a

 (For full table, double click on [ID:nPRA005185])
                                
 * For more details, see below commentary
                                
 
                                
 COMMENTARY:
                                
 JAROMIR SINDEL, CHIEF ECONOMIST, CITIBANK, PRAGUE
                                
 "The result is affected by foreign trade... which only had a
small surplus."
                                
 "The dividend outflow remained solid in June after a strong
outcome in May and of course the disappointment is still the low
inflow of foreign investment to the Czech Republic."
                                
 "For the crown it is neutral information."
                                
 
                                
 JIRI SKOP, ECONOMY AND STRATEGY RESEARCH, KOMERCNI BANKA
                                
 "The June current account ended in line with the market
consensus and a little worse in comparision with our estimates.
The balance was negative, mainly due to the income balance,
which was 24 billion crowns in deficit."
                                
 "The deficit on the current account was offset by the
surplus on the financial account. This year and next the foreign
trade surplus will decline moderately."
                                
 "A small revival in foreign demand this year can lead to
higher exports. However, restocking will continue to be a
problem, which will hike imports."
                                
 
                                
 DAVID MAREK, CHIEF ANALYST, PATRIA FINANCE
                                
 "Since the dividend season is still at its peak, the result
is not surprising, which is reflected in income balance. On the
other hand the trade balance (goods and services) offsets this
to some degree."
                                
 "The reading should not have any significant impact on the
crown exchange rate."
                                
 
                                
 
- The balance of goods and services ran a surplus.
- The balance of current transfers includes a surplus of 2.7
billion crowns on transfers from the EU budget to the Czech
Republic.
- As regards the capital account, a net total of 0.1 billion
crowns was drawn from the EU budget. 
- Capital inflow on the financial account was 28.1 billion crown
under ECB methodology.
- The net inflow of direct investment totalled 6.3 billion
crown, of which net estimated reinvested earnings were 4.7
billion crown.
- The surplus of 30.2 billion crowns on portfolio investment was
due to foreign issues of bonds by entities majority-owned by the
state totalling 27.7 billion crowns.
- The annual net direct investment inflow total has been flat
in the longer-running trend.
- The annual net portfolio investment total has recorded a rising
inflow of funds (the longer-running trend).
- Other investment showed a deficit of 9.1 billion crowns, due
to a change in the short-term international position of banks (a
decline in short-term liabilities). The government drew
on a further part of EIB loans amounting to 0.7 billion crowns.
                                
  
 BACKGROUND:
- Analyst expectations before data release       [ID:nLDE67117B]
- Czech June foreign trade figures               [ID:nLDE675082]
- Polish May C/A data                            [ID:nLDE66C1BF]
- Slovak May C/A data                            [ID:nPRG004274]
- Hungary's Q1 C/A data                          [ID:nLDE65S24L]
- Report on last Czech c.bank rate decision......[ID:nLDE67418T]
                                
               [ID:nPRG004301] [ID:nPRG004294] [ID:nL5217809]

 LINKS:
- For further details on June of payments numbers and past data,
Reuters 3000 Xtra users can click on the Czech National Bank's
website:
                                
 http://www.cnb.cz/en/statistics/bop_stat/

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- For Czech money markets data click on                <CZKVIEW>
- Czech money guide                                      <CZK/1>
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- Czech forward money market rates                      <CZKFRA>

 (Reporting by Jana Mlcochova; editing by Patrick Graham)