INSTANT VIEW 3-Czech Nov retail sales rise slows but above fcast

    Czech retail sales growth slowed 
to 6.4 percent year-on-year in November, but still beat market 
expectations, confirming a revival in consumer spending that 
analysts say may spark an interest rate hike later this year. 
 
KEY POINTS: 
(change in percent)      Nov         Oct         Nov forecast 
RETAIL SALES (y/y)       6.4         8.8 (8.6)      5.5 
 
(Click on [ID:nPRA001122] for full table of November retail 
sales) 
 
- The headline, seasonally-unadjusted figure includes car sales 
and repairs, fuel sales and spending on a variety of consumer 
goods, including foodstuffs. 
- In seasonally unadjusted terms, retail sales net of cars and 
fuel grow 5.7 percent year-on-year, after a 7.8 percent rise a 
month earlier. 
- Foodstuffs sales growth picks up to 4.7 percent from the 
previous month's 4.2 percent. 
- Seasonally-adjusted sales including the auto segment rise by a 
real 0.7 percent month-on-month in November and are up 0.9 
percent excluding the auto segment. 
- In the auto segment, sales up 7.8 percent year-on-year thanks 
to a 9.3 percent gain in fuel sales and a 7.0 percent rise in 
cars sales and repairs. 
 
COMMENTARY: 
    RADOMIR JAC, CHIEF ANALYST, PPF ASSET MANAGEMENT, PRAGUE 
    "While today's number has no immediate implications for 
financial markets nor central bank policy, we believe that the 
CNB (central bank) will continue in its policy tightening cycle 
with the nearest interest rate hike likely to come in second 
quarter of 2007, with outlook for household consumption being 
among major reasons behind the expected monetary policy 
tightening." 
     
    ALES MICHL, ANALYST, RAIFFEISENBANK, PRAGUE 
    "The retail sector signals neither overheating of the 
economy nor serious inflationary pressures. The central bank 
does not need to rush with interest rate hikes, and may wait for 
(more data on) the economic development." 
 
MARKET REACTION: 
- Crown flat at 27.780 per euro . Debt yields and money 
market rates mixed and little moved. 
 
BACKGROUND: 
- Dec consumer inflation                         [ID:nL09833629] 
                                                 [ID:nL09931969] 
- Nov industrial output figures                  [ID:nL15933976] 
- Report on last Czech c.bank rate decision      [ID:nL20551907] 
                                                 [ID:nL20599163] 
 
LINKS: 
- For further details on November retail sales 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-slu 
 
- 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                       
 
 ((Writing by Marek Petrus; prague.newsroom@reuters.com; Reuters 
Messaging: marek.petrus.reuters.com@reuters.net; +420 224 190 
477)) 
  Keywords: CZECH RETAIL/  
    

[PRAGUE/Reuters/Finance.cz]