The increased trade and investment opportunities offered by the elimination of exchange rate risk, lower nominal interest rates and the inflation credibility bonus of an independent ECB outweighed the costs of joining a single currency without the UK, still our largest trading partner.
With the decision to join Economic and Monetary Union came the Maastricht nominal convergence criteria, which provided a stable and solid foundation for economic growth in the second half of the 1990s. The criteria provided a good nominal anchor for both inflation and inflation expectations. Together with a lower interest rate environment, these were a significant element in our successful convergence.