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Slovak national bank cuts rates

The Slovak National Bank reduced its key discount rate by one-quarter point to 4.25% Tuesday, in the second easing of money conditions by the bank so far this year.

Analysts said the bank's move was prompted by the view that the country's currency, the koruna, was too strong and should be reduced. The bank had previously intervened on currency markets to sell koruna in a bid to drive it down. The rate reductions so far this year reversed the bank's actions in 2006 when it raised borrowing costs four times to try to curb inflation and bring the country closer towards fulfilling the Maastricht monetary stability criteria for joining the euro group. Slovakia aims to join the single-currency euro club on January 1, 2009. (monstersandcritics.com)