Recent years witnessed also impressive integration in financial market, in particular in money and government bond markets. At the same time, GDP growth among euro area countries continues to be closely correlated (with an average correlation coefficient close to 70% over the past 10 years). In addition, the inflation differential declined.
The evidence confirms that the degree of integration varies by the market segment and that it is generally more advanced in those market segments that are closer to the single monetary policy, especially the money market. The unsecured money market has been fully integrated since the introduction of the euro, and the repo market is also highly integrated.