Against this background, the risks to the German financial system have risen perceptibly as well. And yet, since the beginning of 2009, the German financial system has become much more resilient. Banks have more – and better-quality – capital. Domestic credit risk is at its lowest level in three years. Funding vulnerabilities have also been reduced.
At the same time, it was announced that the Policy Board members' "understanding of price stability from a medium- to long-term viewpoint" expressed in the year-on-year changes in the CPI was an  BIS Review 1/2007  3  approximate range between zero and two percent, and that the members would conduct monetary policy in the light of this understanding.