PRAGUE, Dec 7 (Reuters) - The Czech foreign trade posted a
17.5 billion ($3.16 billion) surplus in October, more than
double the forecast in a Reuters poll, data showed on Monday.
Exports and imports fell at a double-digit pace, like in
most of the year so far. Exports dropped by 11.2 percent, and
imports fell by 21.1 percent.
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KEY POINTS:
(in bln CZK) Oct Sept Oct fcast
balance 17.48 16.92 (17.76) 8.0
(nominal y/y change in pct)
exports -11.2 -13.5 (-13.9) -9.0
imports -21.1 -17.2 (-18.0) -15.0
(For full table of trade data, click on........[])
- According to seasonally-adjusted preliminary data, exports
rose 0.2 percent in October from September, while imports dipped
2.8 percent month-on-month.
- In euro terms, exports fell 14.8 percent and imports plunged
24.3 percent year-on-year in October.
- The balance showed an annual improvement by 22.7 billion
crowns after the October foreign trade figure last year showed a
5.22 billion gap. The improvement was mainly due to a smaller
deficit in the mineral fuel trade, and a higher surplus in the
balance of trade in cars and machinery.
- Exports of cars and machinery dropped by 11.3 percent
year-on-year. Imports in that sector fell 19.8 percent.
COMMENTARY:
RADOMIR JAC, CHIEF ANALYST, GENERALI PPF ASSET MANAGEMENT
"It looks like that combination of car scrapping subsidies
and base effect (i.e. low exports seen in the final quarter of
previous year) are supportive to balance of trade with cars and
vehicles. Balance of trade with mineral fuels benefits from
year-on-year depreciation of the US dollar and somewhat weaker
mineral fuel prices."
"At the same time, however, while overall trade surplus is
significantly better than expected, we see year-on-year decline
in both exports and imports sharper than expected, which is the
less positive part of the statistics."
JAN VEJMELEK, HEAD OF ECONOMIC AND STRATEGY RESEARCH, KB
"The main drivers were the mineral fuels and machinery. The
exports benefited mainly from higher demand abroad, stimulated
by fiscal measures like the car scrappage subsidy (its ending
will thus have totally contrary impact at the end of this year
and in the first quarter of the next year)."
"The imports decreased on the back of a lacklustre economic
activity, consumer demand and lower prices of the imported
commodities."
DAVID MAREK, CHIEF ANALYST, PATRIA FINANCE
"The trend of the significantly high surpluses continues. It
can be explained by the improving terms of trade, import prices
drop faster fall faster then export prices."
"And while foreign demand is gradually stabilizing, domestic
demand, both investment demand and consumer demand, continues to
be in a deep downturn, which leads to imports falling faster
than exports."
PAVEL MERTLIK, CHIEF ECONOMIST, RAIFFEISENBANK
"The surplus was helped by oil prices and the fading
(effects) of the German scrap subsidy. However, it was also a
very good figure."
"The surplus of the Czech trade balance has surpassed 135
billion crowns this year, which is around 3.5 percent of GDP.
The Czech Republic has strengthened its position this year in
terms of the balance of external relations, and between
countries of central Europe it remains by far the best."
VOJTECH BENDA, SENIOR ANALYST, ING WHOLESALE BANKING
"The good news is the exports are still gradually inching up
(in month on month terms) on the back of improving global
demand."
"Rising sentiment of German manufactures due to filling-up
their order books should support ongoing export growth at least
in coming six months."
"On the other hand, the widening gap of imports signals
ongoing weakness of the Czech investment demand. Despite the
mixed fundamentals, the foreign trade should represent
relatively important factor for the gradual currency
appreciation in middle-term horizon."
MARKET REACTION:
The crown <EURCZK=> strengthened to 25.666 per euro from
25.72 before the data.
BACKGROUND:
- Market expectations before release []
- Slovak Sept trade figures []
[] [] []
- For further details on October foreign trade and other past
data, Reuters 3000 Xtra users can click on the Czech Statistical
Bureau's website:
http://www.czso.cz/eng/csu.nsf/kalendar/2004-vzo
- For LIVE Czech economic data releases, click on <ECONCZ>
- Instant Views on other Czech data click on []
- Overview of Czech macroeconomic indicators []
- Key data releases in central Europe []
- For Czech money markets data click on <CZKVIEW>
- Czech money guide <CZK/1>
- Czech benchmark state bond prices <0#CZBMK=>
- Czech forward money market rates <CZKFRA>
(Reporting by Jana Mlcochova)
