- President Havel considers alarming the increasing number of people who, according to a poll by the STEM and TNS Factum in May, would vote against the Czech Republic’s EU entry. Only 40 % of respondents – compared to 48 % in October 2000 – supported the integration. On the opposite side, the relative share of opponents has jumped from 15 % to 22 %. Havel nonetheless believes that despite the weakening public support, a majority of people would finally vote for the entry in a possible referendum. Foreign Ministry said it would be necessary to focus on nearly 40 % of eligible voters not decided yet on the EU issue.
- Czech industrial output rose +3.7 % year-on-year in June 2001. After adjustment for the number of workdays (in June 2001 there was one less working day compared to June 2000) the growth figure further increases to +5.8 %. Industrial sales added +4.0 % in real terms (+6.2% after adjustment). Primarily manufacturing drove the industrial growth. Within manufacturing, the highest growth rates were recorded at coke and refined petroleum products, machinery and equipment, electrical and optical engineering, and rubber and plastics. On the other hand, the volume of leather and leather production shrank year-on-year, the same holds for textiles and textile products. Output growth in other industrial sectors (mining and quarrying, energy) lagged behind that in manufacturing. Industrial enterprises raised their direct export sales by +9.0 % year-on-year and the share of those sales in overall industrial sales reached 42.4%. In month-on- month terms, seasonally adjusted industrial production fell 0.6 %. Total employment in industry grew by about 8t persons year-on-year in June (in manufacturing by about 14.7t). Labor productivity in industry rose slower than average nominal wages (by 2.9 percentage points), and unit wage costs were higher compared to June 2000.
- Producer prices decreased month-on-month in July, except for construction prices. Industrial producer prices dipped 0.1 %, prices in manufacturing fell 0.2 %. Prices of coke and refined petroleum products decreased most (-3.8 %), prices of chemicals, chemical products and man-made fibers followed suit (-1.4 %). Prices in food products, beverages and tobacco manufacturing grew 0.2 %. In mining and quarrying, prices rose 0.3 % (as a result of growing coal prices), while prices of electricity, gas and water hardly changed. In agriculture, prices fell 2.6 %. Prices of construction work and construction material inputs grew 0.3 % and 0.1 %, respectively. Prices of market services in the business sphere decreased by 1.6 %, out of which prices of post and telecommunication services by 2.5 % (owing to lower charges in telephone traffic). Prices in financial intermediation excluding insurance and pension funds grew 2.0 % as a result of higher charges for accounting entries and standing orders. In year-on-year terms, the growth of industrial producer prices slowed down to 3.0 % in July (from 3.4 % in June). A remarkable growth rate was recorded at manufacturing prices of food products, beverages and tobacco (+7.8 %), and at prices of electricity, gas and water supply (+5.8 %). On the opposite side, producer prices at coke and refined petroleum products fell by 10.9 % year-on-year. Prices of agricultural producers jumped +14.1 %, construction work prices rose +4.0 %, and prices of construction material inputs were 3.4 % up. Prices of market services in the business sphere climbed 4.6 % year-on-year.
- Czech exports to the EU grew by 19 % year-on-year in 2001H1 to nearly CZK 450bn and imports increased by nearly 20 % to CZK 438bn. The EU is with a 70% share in total exports the Czech Republic's largest export market. Road vehicles (CZK 76bn), electrical equipment and appliances (CZK 58bn), metal products (CZK 31bn), industrial machinery and equipment (CZK 28bn), and equipment for telecommunications and sound recording (CZK 20bn) dominated exports to the EU. Electrical equipment and appliances (CZK 64bn), road vehicles (CZK 50bn), industrial machinery and equipment (CZK 33bn), machinery for selected industries (CZK 22bn) and metal products (CZK 22bn) drove the imports from the EU.
- The crown copied euro's gains against the dollar in quiet trading on Monday. CZK was at 33.89/92 to the EUR late Monday, slightly below late Friday’s 33.86/88. Crown/dollar was up to 37.76/78 from 37.87/89 on Friday. Dealers said Reuters they expected a range of 33.85-95 crowns to the euro for most of the week.
- Czech bonds rose following better than expected producer price data on Monday, but volumes were thin and state papers lost some of their gains later in the day. The longest state 6.95/16 closed 15 basis points up compared to late Friday at 99.10/40, yielding 7.04/01 %. The state 6.75/05 firmed 25 basis points at 100.35/65, yielding 6.62/52 %. Traders said the market was positioning for Friday's auction of the 6.40/10 state paper. The bond rose 20 basis points on Monday to 96.40/70, yielding 6.96/91 %. CNB announced it would offer a CZK 4bn tranche of the 6.40/10 bond in an American-style multi-price auction. The auction will be the fifth tranche of the bond. No limit yield was set for the auction. The previous tranche was auctioned in April, yielded 6.32 % on average and the offered volume (CZK 5bn) was oversubscribed. The Czech cabinet plans to launch a new 10-year bond in October. Altogether, CZK 26bn worth of state bonds should be auctioned from now to the end of this year.
| late August 13 | bond yield | late August 10 |
| CZK/EUR | 33.89/92 | - | 33.86/88 |
| CZK/USD | 37.76/78 | - | 37.87/89 |
| State 6.75/05 | 100.35/65 | 6.62/52 | 100.10/40 |
| State 6.95/16 | 99.10/40 | 7.04/01 | 98.95/25 |
(Martin Kupka)