UPDATE 1-Slovak economy sustains robust growth in Q4

 (adds details, analyst, crown) 
    By Martin Santa 
    Slovak real gross domestic 
product grew by a much faster-than-expected 9.5 percent in the 
fourth quarter, data released on Tuesday showed, confirming it 
as one of Europe's hottest economies. 
    The preliminary flash estimate of the fourth quarter GDP, 
published by Statistics Office, came in well above the market 
expectation of an 8.1 percent acceleration, lifting the crown to 
firmer levels against the euro  at 34.605. 
    Growth slowed marginally from 9.8 percent in the third 
quarter but was well above the year ago's 8.1 percent. 
    The flash estimate does not contain any detailed data of the 
economy's structure, but Slovakia has been showing the highest 
growth rates among EU members over the past few years, driven 
mainly by domestic demand and rising car industry investments. 
    "One-off effects such as warm weather and accelerating 
construction output likely influenced growth in the fourth 
quarter," said Lucia Steklacova, a senior analyst at ING Bank, 
in Bratislava. 
    Slovakia has had one of the highest growth rates in the EU 
in the past four years, and it is expected to join the ranks of 
the world fastest growing economies. 
    Economic growth is expected to accelerate further in 2007 on 
the back of rising exports from new car assembly plants 
that French PSA Peugeot Citroen  and South Korean Kia 
Motors  opened last year. 
    The central bank, which raised interest rates last year to 
curb inflation and safeguard Slovakia's goal of adopting the 
euro in 2009, has said the growth is fuelled by rising 
productivity and is not creating inflation pressures. 
    "This (fourth quarter) figure confirmed the fast growth of 
the economy," said Slovenska Sporitelna analyst Maria 
Valachyova. 
    "This should not have a significant impact on monetary 
policy as it is near central bank expectations. We see this 
figure as neutral (for the market)." 
    The central bank lifted interest rates last year to fend-off 
inflation pressures and safeguard the country's plan to adopt 
the euro in 2009, but is widely expected to ease monetary policy 
later this year due to a positive inflation outlook and strong 
crown. 
    "The structure of the GDP data might not indicate demand-led 
inflation pressures and net exports will dominate. But we don't 
see room for lower interest rates until in the third quarter of 
the year," Steklacova added. 
  

[BRATISLAVA/Reuters/Finance.cz]