Slovak crown drops from highs, more firming seen

    BRATISLAVA, Oct 20 (Reuters) - The Slovak crown <EURSKK=> 
hit an all-time high against the euro on Friday but quickly 
eased back as investors booked profits from its firming over the 
past week, dealers said. 
    The crown traded 36.570 to the euro as of 1300 GMT, 0.2 
percent below the record high of 36.490 it hit earlier in the 
session. 
    "The 36.500 is a psychological level. Crown firming is fast, 
but, despite profit taking, investors' appetite for the crown 
remains strong," said Tatra Banka dealer Boris Somorovsky. 
    The latest boost for the Slovak unit came from a central 
bank comment on Friday that the conversion rate for swapping the 
crown for the euro might be set close to the market value if the 
local currency is stable when euro zone entry is negotiated, 
which is expected some time around mid-2008. 
    The crown has broken records on a daily basis in the past 
week, driven by approval of a euro-positive 2007 state budget 
draft, Slovakia's ratings upgrade by Moody's and bullish 
regional sentiment. 
    The market will now assess the prospects of further monetary 
policy tightening the central bank's October 31 meeting after 
four rate hikes by a total of 175 basis points so far this year. 
    Central Bank Governor Ivan Sramko reiterated on Friday the 
bank still saw the need for more monetary policy tightening to 
bring inflation down. Sramko also added Slovakia was on track to 
join the euro in 2009 as planned. 
----------------MARKET SNAPSHOT AT 1430 GMT------------------- 
Crown/Euro <EURSKK=> 36.570 vs 36.555 on Wednesday (-0.05 pct) 
Crown/Dollar <SKK=>  29.000 vs 29.034 (+0.12 pct) 
5-yr govt bond <SK5YT=RR> yield 4.535/4.234 vs 4.465/4.166 
9-yr govt bond <SK9YT=RR> yield 4.539/4.338 vs 4.514/4.314 
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  ((Reporting by Martin Santa, editing by Gerrard Raven; Reuters 
Messaging: martin.santa.reuters.com@reuters.net; +421 5341 
8402)) 
  Keywords: MARKETS SLOVAKIA CROWN CLOSE