But there is still a need for stabilising policy as we navigate our way out of the pandemic. The rapid reopening of the economy has led to steep rises in the prices of fuel, gas and electricity. It has also led to prices increasing for durable goods and some services, as demand outstrips constrained supply.
Turning to a more topical consequence of adopting the euro, this development will further increase Croatia's integration with the EU, even though the country had already de facto lost its sovereign monetary policy well before this. This implies that despite a remaining idiosyncratic component, the overall monetary policy will be the same for Croatia as it is for other economies in the monetary union.