In turn, the central bank’s changes in its policy rate are expected to impact the banks’ cost of funds, both the rates they would pay to depositors and the rates they would demand for making loans.
One concern is the effect of this decision on different countries in the euro area. However, it is important to understand that setting monetary policy for a union of 17 member states is not the same as for a single country. What is the same is the objective – price stability.