Selected economy indicators - March 2006

The y-o-y high growth of industrial production continued also in February. The second month due to frosty winter volume of construction output did not reach the last year level. Also in February volume of imports expanded faster than exports, the trade balance ended in surplus again.

In March the y-o-y level of consumer prices next to did not change. Registered unemployed rate sank the second month already.

FEBRUARY 2006

Industry

In February the y-o-y volume industrial production reached 11,8% ¹ , the trends from January continued due to favourable development in manufacturing of transport equipment (+ 30.8%), manufacturing of electrical and optical devices and manufacturing of basic metals, metallurgical and metalworking products. On the other hand decreases were recorded only in mining and quarrying except energy producing materials, manufacturing of textile and textile products and manufacturing of coke and refined petrol products. The m-o-m seasonally adjusted industrial production decreased by 0.7%; the trend has concurrently been growing up.

In February sales in industry were higher by 11.9% (at constant prices), direct export sales increased by 8.3%. Industrial foreign-controlled enterprises increased its sales in industry by 20.5%; its share in total sales was up by 58.2%. Direct export sales there were up by 10.3%. Number of employees in industry increased (by 2.4%, i. e. by 26.5 thousand people) y-o-y; labour productivity (sales per employee) was 9.3% up. The y-o-y average monthly wage amounted to CZK 17 299 was up both nominally and really by 6.0% and 3.1%, respectively. Labour productivity grew faster and outstripped increase of average wages. As a result unit wage costs decreased by 3.0%.

The y-o-y volume of new orders in selected industrial branches increased by 17.5% in February. Volume of new foreign orders enlarged by 13.2%.

January to February volume of industrial production expanded y-o-y by 13.8%, as against an equal period of the last year. In terms of real comparison sales in industry jumped by 14.4%, direct export sales were up by 11.8%. An average monthly wage increased nominally and really by 6.2% and 3.3%, respectively, under increased number of employees. Labour productivity went up by 11.7%, unit wage costs dropped by 4.9%.

Construction

In February the y-o-y volume of construction output lessened by 8.2% (at constant prices) and its fall from January deepened. Due to a lot of snow work on structural engineering constructions slowed down, this drop appeared in all segments of construction output. The number of employees in construction enterprises (with 20+ employees) rose by 1.3%, as against February 2005. The y-o-y average monthly wage reached CZK 15 844 and decreased by 4.4% nominally and by 6.7% in real terms, as a result of target bonuses had been disbursed in other month than a year ago. Labour productivity decreased by 10.5% per employee, owing to unit wage costs jumped by 6.8%. In terms of real comparison the m-o-m seasonally adjusted construction outputs decreased by 0.6 %, the trends dropped fourth month already.

January to February volume of construction output decreased y-o-y by 5.1% in real terms. In enterprises with 20+ employees labour productivity dropped by 6.7%, an average wage increased nominally by 2.2% and decreased by 0.7% in real terms. Unit wage costs rose by 9.5%.

In February planning and building control authorities granted 7 577 dwellings to be constructed, which was by 5.9% less y-o-y; the approximate value of newly permitted dwellings arrived at CZK 26.0 bn was by 22.0% more on a year before. It was permitted 3 461 new dwellings, which is by 790 more than in February 2005.

External trade

In February the trade balance reached a surplus of CZK 7.1 bn, i. e. more by CZK 0.1 bn than a year ago. The y-o-y volume of both exports and imports enlarged by 11.7% and 12.2%, respectively (at current prices). Due to the appreciation of the koruna against EUR exports and imports rose faster in terms of euros, due to the depreciation of the Czech koruna against USD exports and imports rose slower in dollars. Trade balance with EU member states was active by CZK 26.5 bn, with non-EU states passive by CZK 19.4 bn. The y-o-y figures were favourably influenced by trade in machinery and transport equipment (+CZK 7.0 bn), on the other hand trade balance deficit worsened in trade in mineral fuels (deficit up by CZK 5.2 bn). According to preliminary data, m-o-m seasonally adjusted exports lessened by 1.4% and imports expanded by 0.1%. Trends of both exports and imports came up by 0.7% and 0.8%, respectively.

January to February both exports and imports expanded by 11.5% and 12.5%, respectively. The y-o-y surplus of the trade balance (CZK 18.3 bn.) was smaller by CZK 0.6 bn.


MARCH 2006

Consumer prices

In March, m-o-m consumer prices increased minimally by 0.1%; in total, prices of both goods and services dropped consonantly. Prices in recreation and culture decreased most (seasonal fall in prices of winter holiday stays), clothing and footwear (winter sales). Prices of foods and non-alcoholic beverages, furnishing and housing equipment and public transport decreased also by 0.2%. Reverse way acted growth in prices of spa stays, drugs and personal care services. The y-o-y rise in consumer prices increased by 2.8%, i. e. equally like in February. Prices in housing (mainly prices of natural gas by +25.4%, electricity by +9.0%, heat and hot water supply by +11.3%), public transport, postal and telecommunication services had an impact on that increase. A long-term drop in prices of clothing and footwear, furnishing and housing equipment level had an impact on price-cutting; prices of food and non-alcoholic beverages were also slightly lower. In terms of y-o-y comparison, prices of goods increased by 2.2%, prices of services were higher by 3.7%. Inflation rate, i. e. an increase in the average consumer price index for last 12 months related to the average CPI for the preceding 12 months, amounted to 2.2% in March that was by 0.1 p. p. more than in February.

In March 2006 the y-o-y increase of harmonised index of consumer prices reached 2.4% in the Czech Republic (according to a flash estimate, the HICP in Euro-zone was 2.2%).

Unemployment

The registered unemployment rate decreased in March 2006 y-o-y. It reached 8.8% at the end of the month what means a drop by 0.2 p. p. in comparison to February, in terms of y-o-y comparison it decreased by 0.6 p. p. The females’ unemployment rate was 10.2%; the unemployment rate of males was 7.8%. Labour offices registered 514.8 thousand job applicants at the end of March, which is approx. by 25.7 thousand people less as against March 2005. Share in number of unemployed freshly graduated students to the total number of unemployed people went down to 7.0% (fall by 0.1 p. p. as against last month); however last year reached 7.5%. Number of applicants per one job opportunity was 7.3 at the end of March; at the end of March 2005 it was 9.7 persons.


This press release was not edited for language.

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¹ Starting January 2006 the IPI results are being processed in accordance with a new methodology had been published in Press Release dated March 10, 2006 ( http://www.czso.cz/eng/redakce.nsf/i/change_of_methodology_for_the_industrial_production_index)