* BIS Review 35/1998  ˝  *  *  -3-  The single monetary policy will of course bring demanding challenges to peripheral countries whose industrial structures, behavioural modes and business cycles have previously diverged from those of the core countries. As for Finland, thorough analyses have showed that external shocks have not been much bigger for Finland than for other countries.
Instead, the domestic reactions in the economy and economic policies to these external shocks have greatly strengthened their effects. In the short run, inflation rates may differ somewhat between EMU-member countries, but in the medium term harmonization is necessary.