INSTANT VIEW 4-Czechs post record March trade surplus,beat fcast

...result for that 
month ever, following a 9.1 billion crown surplus in March 2006. 
 
KEY POINTS: 
(in bln CZK)           March      Feb        March fcast 
 balance              12.40      13.61        11.2 
(nominal y/y change in pct) 
 exports              13.0       19.5          n/a 
 imports              11.8       14.5          n/a 
 
 (For full table of trade data, click on........[ID:nPRA001286]) 
 
- The March monthly surplus is the largest ever for that month. 
- Volumes of both exports and imports are highest since November 
2006. 
- According to seasonally-adjusted preliminary data, exports 
rise 0.9 percent in March from February while imports grow 0.3 
percent month-on-month. 
- A surplus in the category of machinery and transport equipment 
segment rises by 4.8 billion crowns year-on-year. Exports in 
this area rise 15.0 percent, while imports are up 13.7 percent. 
- In euro terms, exports rise 15.4 percent and imports by 14.2 
percent year-on-year in March, outpacing the growth rates in 
local currency terms because of a previous firming in the crown. 
 
    COMMENTARY: 
    VOJTECH BENDA, SENIOR ECONOMIST, ING WHOLESALE BANKING, 
PRAGUE 
    "Foreign trade continues to benefit from an ongoing robust 
growth in European Union countries and a slower rate of firming 
in the real exchange rate. On the other hand, imports are 
catching up on exports thanks to strengthening domestic demand. 
    "Further growth in the foreign trade surplus should in the 
second half of this year play a key role -- together with a 
gradual narrowing of the negative interest rate differential 
(against major currencies) -- in helping the crown return to a 
medium-term appreciation trajectory." 
 
    RADOMIR JAC, CHIEF ANALYST, PPF ASSET MANAGEMENT, PRAGUE 
    "(The) structure, where trade with transport means and 
mineral fuels is among the items leading the year-on-year 
improvement in trade balance, is not a surprise. Good news is 
the healthy growth of exports to Germany. We expect the Czech 
foreign trade balance to benefit from a stronger than previously 
expected economic growth in the euro zone, which will generate 
additional demand for Czech exports in the months to come. 
    "For the whole of 2007 we expect the Czech foreign trade 
surplus to widen to 65 billion crowns from 44.4 billion recorded 
in 2006. 
    "The foreign trade numbers are the sort of news which should 
help the crown to recover a bit. Still, the crown remains weaker 
than what the CNB (central bank) assumes in its latest 
macroeconomic forecast and the recent development of the crown 
supports the view that the CNB may increase its interest rates 
already at its May 31 board meeting." 
     
    ALES MICHL, ANALYST, RAIFFEISENBANK, PRAGUE 
    "Weather has moved the Czech economy and helped the trade 
balance achieve another record (surplus). Unusually warm weather 
months allowed firms to significantly increase production and 
consequently exports. 
    "We expect to increase our forecast for this year's foreign 
trade surplus." 
 
MARKET REACTION: 
- Crown extends this week's fall after the news, trading near 
two-month lows at 28.280 per euro  by 0725 GMT. 
 
BACKGROUND: 
- Market expectations before release             [ID:nL02507716] 
- Slovak Feb trade figures                       [ID:nL11661448] 
- Polish trade in Feb                            [ID:nL12492933] 
- Hungary's Feb trade data                       [ID:nL06431978] 
- Report on last Czech c.bank rate decision      [ID:nPRG000331] 
                                                 [ID:nL26624395] 
 
- For further details on March foreign trade and other past 
data, Reuters 3000 Xtra users can click on the Czech Statistical 
Bureau's website: 
    http://www.czso.cz/eng/csu.nsf/kalendar/2004-vzo 
 
- For LIVE Czech economic data releases, click on        
- Instant Views on other Czech data click on        [CZ/INSTANT] 
- Overview of Czech macroeconomic indicators            [CZ/ECI] 
 
- Key data releases in central Europe    [CEE-CONVERGENCE-WATCH] 
- For Czech money markets data click on                 
- Czech money guide                                       
- Czech benchmark state bond prices                    
- Czech forward money market rates                       
 
 

[PRAGUE/Reuters/Finance.cz]