POLL-Slovak cbank seen leaving rates on hold in Sept

...    BRATISLAVA, Sept 19 (Reuters) - The National Bank of 
Slovakia (NBS) will probably leave its key interest rate on hold 
for a fifth successive month next week, waiting for its 
borrowing costs to converge with the euro zone, a Reuters poll 
showed on Wednesday. 
    The Slovak economy expanded at a near record pace of 9.4 
percent in the second quarter, remaining one of the fastest 
growing nations in the European Union. 
    But inflation was at a record low in August, helping 
Slovakia to meet the price growth criterion for euro adoption 
for the first time ever. 
    All 12 analysts surveyed by Reuters expected the main 
two-week repo rate to stay at 4.25 percent when the central bank 
decides on monetary policy on Sept. 25. Most also saw the bank 
staying put for the rest of this year. 
    "Our main scenario is that the central bank remains on hold 
until the mid of next year, and then they will slowly converge 
rates to the level of the ECB (European Central Bank)," said 
Anne-Francoise Blueher, analyst at Komercni Banka in Prague. 
    "Inflation will go down and they (the NBS) will not cut 
rates now because they want to prove sustainability of 
inflationary developments ahead of the euro," she said. 
    Annual EU-norm inflation stayed at 1.2 percent for the 
second month in a row in August, bringing the 12-month average 
to 2.37 percent, below the threshold of 2.56 percent. 
    The average price growth will be the yardstick for assessing 
Slovakia's readiness to enter the euro zone in 2009. 
    The NBS, finance ministry and analysts expect the country to 
beat the inflation threshold, defined as 1.5 percentage points 
above the average of the three lowest inflation rates in the EU, 
with a comfortable margin next spring. 
    Some analysts saw a chance that the Slovak central bank 
might cut interest rates in the final months of 2007 if the 
crown currency firms sharply or the ECB keeps rates on hold. 
    "I see room for a 25 basis-point cut, but only if there is 
strong appreciation pressure on the crown," said Piotr Matys, an 
analyst at 4Cast in London. 
    "Also, it is not clear what the ECB will do. Our view is 
that euro zone rates will peak at 4.25 percent in December, but 
there is a risk to the downside to that scenario, which would 
favour my call of the 25 basis-point cut by the NBS," he said. 
    A narrow majority of economists expect the ECB to raise rates 
by 25 basis points from 4 percent by the end of 2007. [ECB/INT] 
    The crown was at 33.780 per euro  as of 1130 GMT, 
recovering from a three-month low of 33.970 per euro seen on 
Tuesday. The unit is up 2.4 percent against the euro this year. 
  (For a table with individual forecasts please click on 
[ID:nL19818606]) 
  (Additional reporting by Martin Santa) 
  
  Keywords: SLOVAKIA CBANK/RATES