5  For example, Ehrmann and Ziegelmeyer (2013) estimate that a 300 basis point cut in interest rates would result in a substantial reduction of the median debt-service burden, in particular for households in the lowest income quintile where the ratio of median debt service to income would otherwise have been 44%, rather than the observed 32%.
The problem at the moment is that in the euro area as a whole we are still far from reaching the target of balanced budgets in normal cyclical conditions. Substantial structural imbalances continue to restrict the flexibility of public sector budgets.