Whenever excess liquidity is large, the spread between the EONIA and the deposit facility rate narrows, as the latter is the rate that determines the marginal cost of interbank lending when there is excess supply of central bank reserves. This was fully in line with our policy intentions.
The low interest rates were transmitted to loan costs of the public by the strong and stable banking system and the system of variable-rate in most loans. The growth in domestic demand in recent years has been financed to an increasing extent by debt, as households and the public sector have run financial deficits.