INSTANT VIEW 1-Czech March PMI growth strong despite weakening

...the rate of improvement in business conditions 
weakened in March to 57.0 from February's record high of 58.5. 
 
KEY POINTS: 
                                 MARCH 07    FEB 07    MARCH 06 
 Purchasing Managers' Index        57.0       58.5       55.7 
 Output                            57.3       60.3       57.4 
 New orders                        57.9       59.2       58.6 
 
 (Full table of data...............................[nL02727303]) 
 
- A figure above 50 indicates expansion on the previous month 
while a number below 50 signals contraction. 
- The headline index has held above the neutral mark of 50.0 
since March 2003. 
- The survey continued to indicate pressure on manufacturing 
capacity in March, despite the month-on-month weakening in 
growth of new business. 
- Production levels eased from February's 21 month high in 
March, signaling the weakest growth of production for 5 months. 
- The weakening in new order growth led to a slower rise in 
manufacturing output in March. But output continued to rise 
sharply and growth has been sustained for 4-1/2 years. 
- Input prices moved down in March, a second straight month of 
easing. Metals, wood products and energy were the most commonly 
mentioned sources of cost inflation. 
- Employment index fell but still signalled a strong increase in 
jobs in the sector. 
- Data released by NTC Research and ABN Amro. 
 
COMMENTARY: 
    ZSOLT PAPP, ECONOMIST, ABN AMRO, LONDON 
    "Czech manufacturing maintains its dynamics as signaled by 
March PMI figures. The slightly softer numbers in output and 
orders come after an exceptionally strong February and do not 
suggest to us a turnaround in trend. In our view, March PMI 
supports the overall healthy external balance of the Czech 
economy." 
 
BACKGROUND: 
- Report on most recent interest rate decision...[ID:nPRA001221] 
                                 [ID:nL29598110] [ID:nPRA001222] 
- Jan foreign trade figures......................[ID:nL06520638] 
- Jan industrial output..........................[ID:nL13408467] 
- Fourth-quarter GDP growth data.................[ID:nL09207856] 
 
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