While the short-term interest rate differential vis-à-vis the euro area persisted until recently, reflecting the monetary policy strategy pursued by Banka Slovenije, long-term interest rates approached levels close to the euro area already in 2004, reflecting market confidence in general economic and fiscal developments in Slovenia and the credibility of the monetary and exchange rate policy.
The process of nominal convergence has been accompanied by robust economic growth. Real GDP growth in Slovenia has been well above the euro area in the recent years. Growth has been underpinned by domestic demand as well as strong exports, which reflects the increased integration of Slovenia with the EU and the euro area.