A single currency for the region would lead to elimination of transaction costs and of volatility in exchange rates among members of the regional grouping. Just as a common language promotes communication among people, a common currency could promote trade and investment among countries in the region.
In this sense, the fall in inflation – by boosting the purchasing power of our citizens – has acted as an automatic stabiliser at a time in which the economic conditions were deteriorating. Inflation expectations are a good measure of the degree to which the free fall in the economy and the dis-inflationary process could come to feed upon itself.