Czech industrial production growth accelerated for the third month, while industrial sales declined, indicating manufacturers are building up inventories during a slowdown in Western European demand. Industrial production increased by 7.0%, year-on-year, in December, sales dropped by 4.5%.
Import prices dived again. They fell by 1.5%, m-o-m, and 7.0% y-o-y. Export prices decreased by 1.6%, m-o-m, and 3.9%, y-o-y. Thus, terms of trade worsened by 0.1%, m-o-m, but they improved by 3.3, y-o-y.
The exchange rate of Hungarian forint soared to a new all-time high of 240.70 HUF/EUR yesterday after a comment of Prime Minister Viktor Orban. He said that the forint would appreciate by 3-5% every year until Hungary joins EMU.
President Vaclav Havel will re-appoint CNB Vice-governor Ludek Niedermayer, whose six-year mandate would expire on Feb 27.
The Lower House of Parliament yesterday in the first reading did not reject the government's draft bill on a loan of CZK 76.9bn to cover the purchase of 24 Gripen fighters despite of right-wing parties' resistance.
Jack Guynn, president of the Federal Reserve Bank of Atlanta, said that Federal Reserve policy makers may start reversing their series of 11 interest rate cuts if a stronger-than-expected recovery this year rekindles inflation concerns.
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