INSTANT VIEW 2-Slovak April PPI well below fcast

...factory-gate 
costs (PPI) at 2.2 percent, the Statistics Office said on 
Monday. 
 
KEY POINTS: 
 PRODUCER PRICES             APRIL 07   APRIL FORECASTS 
 pct change month/month       -0.3           +0.3 
 pct change year/year         +2.2           +2.8 
(Full table of March PPI data ........ [ID:nPRG000334]) 
 
- Among the three PPI categories, prices of industrial products 
fall by 0.1 percent on the month, after a 0.6 percent rise in 
March. 
- Prices of electricity, gas, steam and hot water fall by 0.4 
percent month-on-month, after a 0.7 percent decrease in March. 
- Prices of raw materials also remain in negative territory, 
falling 0.5 percent in April, after a 1.0 percent fall in the 
previous month. 
- Within industrial products, refinery goods prices rise by 3.3 
percent month-on-month after an 16.7 percent jump in March. 
  
ANALYST COMMENTS: 
    EDUARD HAGARA, ANALYST, ING BANK BRATISLAVA 
    "The data was influenced mainly by a decline in 
manufacturing prices, and energy prices were also a contributing 
factor, probably because of gas prices. 
    "The data should not have any influence on interest rate 
settings." 
     
MARKET REACTION: 
    The market showed no reaction to the data, with the crown 
trading little changed at 34.050 per euro . 
     
BACKGROUND 
- Slovak producer price inflation slowed at the beginning of 
2007 after the impact of last year's jump of energy prices 
faded. 
- Slowing PPI has coincided with falling consumer inflation rate 
this year. 
- Slovakia needs to keep consumer price inflation down by spring 
2008 to fulfil its goal of adopting the euro in 2009. 
- The central bank cut the main two-week interest rate by 25 
basis points in March and April, as rising crown tightened 
monetary conditions and inflation outlook improved. 
- Analysts expected the bank to hold the key two-week repo rate 
unchanged at 4.25 percent at the monthly monetary policy on May 
29. 
  
LINKS: 
- For further details on April producer prices, Reuters 3000 
Xtra users can click on the statistics office's website: 
    http://www.statistics.sk/webdata/english/index2_a.htm 
 
- For LIVE Slovak economic data releases, click on...... 
- Schedule of upcoming indicator releases............ 
- Summary of short-term economic data forecasts...... 
 
- Stories on Slovak currency moves........................[SKK/] 
- Slovak speed money guide .............................. 
- Slovak benchmark state bond prices ................. 
- Slovak forward money market rates .................... 
 

[BRATISLAVA/Reuters/Finance.cz]