(Repeats story published on July 29)
* WHAT: Czech July consumer price inflation, industrial
production, jobless data releases ([] for TABLE).
* WHEN: Aug. 8, 0700 GMT
* Consumer prices seen up 0.6 percent month-on-month and 6.9
percent year on year. June industrial output growth forecast at
5.4 percent, end-July unemployment rate flat at 5.2 percent.
By Mirka Krufova
PRAGUE (Reuters) - Price hikes for natural gas and
cigarettes probably pushed up Czech inflation to 6.9 percent in
July, a Reuters poll shows, although analysts still expect price
growth to slow later this year, possibly allowing an interest
rate cut.
Thirteen analysts expected a 0.6 percent monthly rise in the
consumer price index (CPI) <CZCPI=ECI>, a broad gauge of
inflation targeted by the central bank.
The consensus [] forecast saw annual inflation
<CZCPIY=ECI> gaining speed to 6.9 percent, from 6.7 in June.
The central bank expects price growth to rise to around 7.0
percent in the autumn months before retracting significantly in
late 2008 and early 2009, when high base effects from
state-controlled price hikes begin to fade from the data.
Radomir Jac, chief analyst at Generali PPF Asset Management,
said CPI would near the expected peak level largely due to hikes
in natural gas prices and the delayed impact of a January
tobacco tax increase.
"By the end of the third quarter, we will see a decline in
Czech annual inflation," he said.
"This tendency should become more pronounced in the last
quarter of the year, mainly due to the base effect in food
prices and also due to the expected disinflationary impact of
the strong crown."
The first data of the month will be the June foreign trade
balance <CZFTB=ECI>, on Aug. 4, and analysts predict a surplus
of 9.3 billion crowns. Inflation data is due on Aug. 8, the day
after the central bank's next interest rate meeting.
TALK OF LOOSENING
The bank has said the strong crown, up more than 15 percent
against the euro over the last year <EURCZK=>, has staunched the
inflation outlook to such a degree that it could undershoot the
bank's 2009 target of 3 percent plus or minus one percentage
point.
On Tuesday Vice-Governor Miroslav Singer reiterated comments
by his colleagues over the past week that the board could
potentially discuss cutting interest rates on Aug. 7
[].
With the bank having discussed hiking rates at its June 26
meeting, the prospect of a cut is a significant shift, not only
from its own policy but also from the central European trend of
tightening in the face of persistent price growth.
With a main rate of 3.75 percent -- a 50 basis point
discount to the euro zone rate -- the Czechs already have the
lowest rates in the European Union.
And despite the dovish pronouncements from the central bank,
most analysts say the threat of inflation from global factors is
still too high for the Czechs to ease, and they will keep rates
on hold as the rest of the region is expected to do.
Analysts also expected industrial output to have rebounded
in June to grow by 5.4 percent, versus 3.4 percent a month
earlier, almost half the market forecast. End July jobless
<CZUNR=ECI> is seen rising to 5.2 percent from 5.0 percent.
Analysts said industrial output <CZIPY=ECI> has suffered in
recent months due to the crown's record high levels against the
euro and a slowdown in the euro zone, both of which have
significantly cut demand for Czech exports.
Economists and central bankers have said a significant
downturn in foreign demand could potentially undercut price
growth and prompt looser monetary policy.
(Writing by Michael Winfrey; Editing by Ruth Pitchford)
