We are both among the world’s top 10 oil producers. We share a democratic system of government and market-based economies. And our monetary policies are both anchored by an inflation target with a flexible exchange rate. In recent years we both faced a global financial crisis that emanated from beyond our borders. We weren’t immune but came through it better than most.
Given the clear mandate of the Eurosystem, the Governing Council has to take into account the increased inflation risks. At the current juncture, the sharp increase of inflation – due to high oil and food prices, along with some signs of increase in manufactured goods prices and service prices and ongoing strong monetary expansion – is of particular concern to the Governing Council.