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What the markets said

MARKET watchers were careful in commenting on the results of parliamentary elections, but suggested that the outcome was more optimistic than they had anticipated. For business, the most important aspect of the elections was whether or not the outgoing government's reforms would be cancelled or continued.
"It seems that the reform parties [after elections] have a better negotiating position," said ING Bank analyst Ján Tóth.

MARKET watchers were careful in commenting on the results of parliamentary elections, but suggested that the outcome was more optimistic than they had anticipated. For business, the most important aspect of the elections was whether or not the outgoing government's reforms would be cancelled or continued.

"It seems that the reform parties [after elections] have a better negotiating position," said ING Bank analyst Ján Tóth.

According to Tóth, investors will be watching developments in key spheres of the economy, such as the road to adoption of the euro, the flat tax and the Labour Code.

Eugen Jurzyca of the Institute for Economic and Social Reforms (INEKO) think tank also said he believed that the reform path set by the previous government would continue. However, he also told the SITA news wire that developments to come would better mirror the values of the Slovak voter.

Market watchers agree that the adoption of the euro will be of key importance. As for the short-term impact of the elections, they say that the response of the Slovak currency to the results will be important. According to Poštová banka analyst Miroslav Šmál, if the next government is a leftist one, the curency might weaken towards the euro.

Slovak Academy of Sciences economist Viliam Páleník said that the election results suggested the next coalition in Slovakia would not be centre-right. He told SITA that the cancellation of reforms would certainly not help Slovakia.

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