A country can be outside the monetary union, but still sign up for the fiscal compact, or join the soon-to-be-established Single Supervisory Mechanism (SSM). The line between helpful inclusion and potentially damaging exclusion is not so clear any longer. But as this audience knows better than most, how these issues are resolved will have profound implications for businesses in Central and Eastern Europe.
The sizeable decline in short-term risk-free rates has caused interest rates on variable loans to decline to historic lows (Graph 6). In Australia, the bulk of loans are in this form. Around 70 per cent of housing loans are variable rate. For business loans the share is even higher at 85 per cent.