PRAGUE, March 9 (Reuters) - Czech consumer prices rose by
lower-than-expected 0.1 percent in February from January,
putting the annual inflation rate at 1.8 percent.
The annual figure was below market expectations for a 2
percent rise and prompted analysts to say the central bank would
keep interest rates on hold in the near term, although price
pressures later in the year would lead to tightening.
Parallel data showed a 15.7 billion crown ($898.7 million)
foreign trade surplus in January, bigger than analyst forecasts.
Exports rose 28.4 percent year-on-year and imports by 30.9
percent. The full-year 2010 trade balance was revised to a
122.82 billion crown surplus, down from previously estimated
124.5 billion surplus, the statistics office said.
The bureau also released for the first time foreign trade
data adjusted for transactions by non-residents, showing a
surplus of 0.57 billion crowns, down from 5.6 billion crowns
last year.
The new methodology looks at change in ownership of goods
between residents and non-residents instead of taking into
account the cross-border move as the point when international
trade is conducted. It is calculated on the basis of
value-added, or sales, tax reports.
(See details below commentary)
COMMENTARY:
PAVEL SOBISEK, CHIEF ECONOMIST, UNICREDIT, PRAGUE
"Inflation will be most watched. It is a bit slower than the
consensus, on the other hand the direction is correct."
"Year-on-year inflation has resumed growth, and apparently
this is not the end of the story. It is only a question of time
when CPI will exceed 2 percent, maybe rather significantly."
"I can see two driving forces: motor fuel prices and tobacco
prices. In both cases, a lot is already in the pipeline but is
not reflected in February."
"The figure means no change in the (central bank) stance.
But the fact there is an oil price spike, the fact the ECB is
going to hike in April, and the fact the Czech government plans
a VAT rise this year -- all these are in favour of a larger rate
hike this year than previously thought or included in the
inflation report."
****************************************************************
KEY POINTS:
CONSUMER INFLATION
(pct change) Feb Jan Feb forecast
month/month 0.1 0.7 0.2
year/year 1.8 1.7 2.0
FOREIGN TRADE
(in bln CZK) Jan Dec Jan fcast
balance 15.69 0.57 (0.99) 13.25
(nominal y/y change in pct)
exports 28.4 n/a (27.0) 24.2
imports 30.99 n/a (28.5) 27.3
CZECH AVG WAGE Q4/10 Q3/10 Q4/09 2010
Monthly wage (nominal) 25,803 23,673 25,565 23,951
real change y/y (pct) -1.2 0.2 4.8 0.5
nominal change y/y +0.9 2.1 5.2 2.0
Details of January foreign trade................[]
Details of February inflation ..................[]
Details of Q4 avg wage .........................[]
CENTRAL BANK FORECAST:
The central bank saw in its last quarterly forecast February
annual inflation at 2.1 percent.
BACKGROUND:
- Market expectations before release []
- December foreign trade figures []
- January consumer inflation [] []
[]
- January producer prices figures []
- Report on last Czech c.bank rate decision......[]
[] [] []
LINKS:
- For further details on January foreign trade, February
inflation, Q4 real wage and past data, Reuters 3000 Xtra users
can click on the Czech Statistical Bureau's Website:
http://www.czso.cz/eng/csu.nsf/kalendar/2004-pru
- 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 Jana Mlcochova; editing by Michael Winfrey)
