However, amid concern in global financial and capital markets over elevated inflation and acceleration in the pace of policy interest rate hikes in the United States, some have pointed out risks posed, for example, by significant adjustments in risk asset prices, such as stocks, and capital outflows from emerging economies. It is necessary to pay close attention to how these risks will evolve.
In the euro area, the low inflation rate and low interest rates favour the hoarding of cash, for the opportunity costs of holding cash are low. Approximately one-quarter of all euro notes are used outside the euro area – not only as a reliable store of value, but also as an accepted means of payment in international markets.