Slovak crown firms on CPI data, seen stronger

    The Slovak crown closed 
stronger against the euro after a roller-coaster session on 
Friday, as disappointing inflation data suggested a delay in the 
expected monetary policy easing, traders said. 
    The crown firmed and eased back during the session, to end 
at 34.580 per euro, stronger from 34.615 late on Thursday. 
    The Statistics Office published worse than expected 
inflation data for January, which, analysts said, meant the 
central bank would probably delay widely expected interest rate 
cuts until the second half of the year. 
    "The move was inspired by the data," said HVB Bank dealer 
Marian Sulko. "Most players understood it as positive news for 
the crown." 
    Despite the higher inflation reading, analyst said the 
country was still on track to meet conditions for the planned 
euro adoption in 2009. 
    The market did not react to a bigger than expected December 
foreign trade deficit, also released on Friday, as analysts saw 
significant trade balance improvement later in the year. 
    Traders expected the crown to move towards stronger levels 
in the coming days, saying the mood on central European markets 
would be the main factor for the future trend. 
    "Everything plays in favour of carry-trades, and if the 
crown breaks (firms through) 34.400-34.300 per euro, it will 
move further on," Sulko said. 
------------------ MARKET SNAPSHOT AT 1550 GMT ----------------- 
Crown/euro  34.580 vs 34.615 on Thursday (+0.10 pct) 
Crown/dollar   26.599 vs 26.565 (-0.13 pct) 
5-yr govt bond  yield 4.300/3.901 vs 4.281/3.881 pct 
7-yr govt bond  yield 4.347/149 vs 4.333/113 pct 
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[BRATISLAVA/Reuters/Finance.cz]