Indeed, with frictionless capital markets, at the effective lower bound forward guidance would be the only way to ease the monetary policy stance.5 In this setup, central bank asset purchases would be ineffective: whether assets are held on the balance sheet of the public or private sector would not affect term premia and, hence, long-term interest rates.
The regional single market can also develop more effectively if actors understand the need for cooperation and regulatory convergence, and work together to find common rules and which are enforced by those who have agreed to them. Investors and market actors will feel more confident if rules are clear and enforceable.