The debate centred around concerns that monetary stability would be jeopardised. Stability ranks extremely high in Germany’s order of priorities, with hyperinflation having wiped out the currency twice this century, followed by currency reforms and their horrible political, social and economic consequences. Against this background, the debate on economic and fiscal convergence and the group of participating countries was especially heated in Germany.
With less pressure on capacity, core inflation is expected to move below 2 per cent in early 2002, and to stay below through the remainder of the year.