INSTANT VIEW 4-Slovak Q1 GDP touch above flash estimate

...Friday. 
  
KEY POINTS 
 SLOVAK REAL GDP          Q1/07     Q4/06       Q1/06      FY/06 
 (pct change yr/yr)       +9.0      +9.6        +6.7       +8.3 
 (Full GDP table...................[ID:nPRG000372]) 
- The first quarter GDP figure is a touch above the Statistics 
Office's flash estimate of 8.9 percent reported last month. 
- The Statistics Office says it sees full 2007 GDP growth at 8.8 
percent year-on-year. 
- End-2007 headline CPI is seen at 2.6 percent year-on-year. 
- Household consumption remains strong at 6.5 percent growth, 
year-on-year while government consumption edges up 
quarter-on-quarter, though is down sharply from the same quarter 
of 2006. 
     
ANALYST COMMENTS 
    SILVIA CECHOVICOVA, ANALYST, CSOB BANK, BRATISLAVA 
    "The structure has shown that net exports were key 
contributors to economic growth. 
    "Household consumption remains strong and it seems demand 
will remain an important factor. 
    "Currently, there are no inflation risks, but it is a factor 
to watch in the future. 
    "The central bank is likely to maintain a neutral bias and 
will wait how the European Central Bank will increase interest 
rates." 
     
    PIOTR MATYS, ANALYST, 4CAST, LONDON 
    "No real surprise in terms of final GDP growth and the 
modest revision is a very small consolation, if any at all, to 
the market which had expected a double digit growth. 
    "Ironically, Slovakia GDP is the highest in the region and 
will remain solid as new car factories increase their output." 
     
    LUCIA STEKLACOVA, SENIOR ANALYST, ING BANK, BRATISLAVA 
    "The structure is in line with our expectations. It is a 
healthy, balanced growth and a confirmation (of the healthy 
structure) seen in the last quarter (of 2006)." 
    "Household consumption is slightly higher than expected, but 
since the wage growth (in the first quarter) is smaller than 
expected, we see no inflation threats in the first half of the 
year." 
     
    JURAJ VALACHY, ANALYST, TATRA BANKA, BRATISLAVA 
    "The structure indicates that strong growth of domestic 
demand continues. Inflation developments are also slightly 
higher than the central bank had expected, so there is no reason 
for it to lower interest rates. 
    "Another factor is that the bank needs to near interest 
rates of the ECB, which are catching up. But even without euro 
zone entry, these figures do not provide a reason to 
significantly lower interest rates. 
    "Economic growth was slowed largely by a decrease in 
inventories, probably due to investments. The structure is 
favourable and does not indicate inflationary pressures. 
    "In the second quarter, growth could be slightly higher if 
strong retail sales growth also continues." 
     
MARKET REACTION 
- The Slovak crown did not react to the figures, trading at 
33.930 per euro  as of 0720 GMT. The unit closed at 
33.940 on Thursday. 
     
BACKGROUND 
- The Slovak economy has been showing the highest growth rates 
among the four largest new EU members from central Europe over 
the past few years.  
- GDP growth has been helped by reviving domestic demand as 
households consumption rises after years of belt-tightening 
reforms. 
- Investments have also increased in the past year, mainly 
thanks to large project such as car factories of French PSA 
Peugeot  and South Korean Kia Motors . 
- The central bank does not consider fast GDP rise as major 
danger to inflation as economic growth appears to be driven by 
rising productivity and exports. 
     
 LINKS: 
- For further details on past data, Reuters 3000 Xtra users can 
click on the Slovak Statistics Office's website: 
    http://wwww.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 ....................