First, the import content of German exports is quite high. Intermediate inputs and goods delivered by other euroarea countries account already for nearly 40 percent of German exports. So, making German exports less attractive also weakens component suppliers, including those located in other euroarea countries.
•  While some modest withdrawal of monetary policy stimulus will likely be required over time, consistent with achieving the 2 per cent inflation target, the more muted inflation outlook and the beginnings of a more constructive evolution of imbalances in the household sector suggest that the timing of any such withdrawal is less imminent than previously anticipated.