INSTANT VIEW 2-Czech Q1 GDP up 6.1 pct, in line with fcast

...line with the market forecast and 
unchanged from an upwardly revised fourth-quarter rate. 
    The Czech expansion lagged the boom in neighbouring 
Slovakia, which posted 9.0 percent growth in January-March, but 
matched 6.1 percent growth in northern neighbour Poland. 
    The Czech economy still outpaced Hungary, which reported 2.7 
percent growth. 
 
KEY POINTS: 
(pct change)        Q1/07     Q4/06       Fcast Q1 
 year/year           6.1    6.1 (5.8)      6.1 
 NOTE. GDP up 1.5 percent quarter-on-quarter when adjusted for 
seasonal factors and the difference in working days. 
 
 CENTRAL BANK FORECAST: 5.6-6.0 percent GDP growth envisaged by 
its most recent projection unveiled in April. 
 
 (For full table of Q4 GDP data...................[nPRA001337]) 
 
- Growth is driven by a 6.7 percent rise household consumption, 
the strongest in 13 quarters. 
- Consumers take advantage of a 7.8 percent rise in disposable 
incomes to spend on everything from cars and household equipment 
to clothing and audio-video equipment, statistics office says. 
- Gross fixed capital formation -- or investments -- slows to a 
1.5 percent rate from a 8.1 percent rise in the fourth quarter. 
 
COMMENTARY: 
    PAVEL MERTLIK, CHIEF ECONOMIST, RAIFFEISENBANK, PRAGUE 
    "The increased consumption means elevated demand-pull 
inflation pressures. Once central bankers familiarise themselves 
with today's data, they will have yet another argument for 
raising interest rates by a further 25 basis points. We expect 
them to take this step with the new inflation forecast in July." 
 
 
MARKET REACTION: 
- Crown largely steady at 28.460 per euro  by 0712 GMT 
from 28.440 just before the data. 
 
BACKGROUND: 
- For story on analysts' expectations before the data release, 
double click on                                [ID:nL30315279] 
- Slovak Q1 GDP                                [ID:nL01172847] 
- Poland's Q1 GDP                              [ID:nL30715761] 
- Hungary's Q1 GDP                             [ID:nBUD002033] 
 
LINKS: 
- For further details on first quarter GDP 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-hdp 
 
- For LIVE Czech economic data releases, click on        
- Instant Views on other Czech data                 [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                       
 
  
  Keywords: CZECH ECONOMY/GDP