Situation Report on the Monetary Development of Slovakia in June 2008

1. Consumer prices, measured by the harmonized index of consumer prices (HICP), increased by 0.4% in June, as compared with the previous month. The year-on-year growth rate of headline inflation was 4.3%. The core inflation year-on-year growth rate (excl. energy and unprocessed foodstuffs prices) was 4.1%.

2. Consumer prices measured by the CPI increased by 0.4% in June, when compared with the previous month. The year-on-year rate of headline inflation was 4.6% and that of core inflation 4.8%.

3. Monetary aggregate M3 (in accordance with the ECB methodology) increased by SKK 17.3 billion on a month-on-month basis in May, while its year-on-year growth rate decreased to 9.8% in comparison with the April figure.

4. The total volume of claims of monetary financial institutions (MFI) vis-a-vis residents (incl. securities issued by customers and held by the MFI sector, according to the ECB methodology) recorded in May a month-on-month increase by SKK 2.8 billion, while their year-on-year growth slowed by 3 percentage points to 14.0%.

5. The average lending rate on new loans to non-financial corporations increased by 0.06 of a percentage point to 5.75% in May, and that on new loans to households went up by 0.15 of a percentage point to 11.97%. The average lending rate on new deposits of non-financial corporations increased by 0.20 of a percentage point to 2.33% in the same period, and that on new deposits of households went down by 0.04 of a percentage point to 1.12%.

6. The central government budget deficit was SKK 4.1 billion as at the end of June.

7. Foreign exchange reserves of the NBS (at the current exchange rate) reached the amount of USD 19.9 billion in June. Their amount at the end of the month represented the equivalent of 3.0 times the average monthly imports of goods and services to Slovakia for the first five months in 2008. The coverage of the average monthly imports of goods and services (payments for imports of goods and services acquired from banking statistics data) by the official foreign exchange reserves represented as at the end of May the equivalent of 4.0 times the average monthly imports of goods and services to Slovakia for the first five months in 2008.

8. Národná banka Slovenska did not make any foreign exchange intervention in June.

9. According to the preliminary data, the balance of payments current account for April 2008 ended in a deficit of SKK 14.0 billion and the capital and financial account of the balance of payments for the same period ended in a surplus of SKK 11.6 billion. The balance of payments current account for January to May ended in a deficit of SKK 25.6 billion and the trade balance surplus was SKK 2.0 billion.

10. The total sterilization position of the NBS in June, in comparison with May, increased nearly by SKK 400 billion to SKK 374.5 billion.

Jana Kovacova
Spokesperson of the NBS

National Bank of Slovakia
Communications Section
Imricha Karvasa 1, 813 25 Bratislava, Slovak Republic
Tel.: +421-2-5787 2161,+421-2-5865 2161, +421-2-5787 2166, 421-2-5865 2166
Internet: http://www.nbs.sk

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