And on the subject of positive side effects, we should not overlook the advantages that German taxpayers gain from the low interest rate policy; they are the ones paying lower taxes because the German Government can refinance itself at more favourable rates.
Either way, there are consequences for the funding costs of both the sovereign and the banks. 1  Panel regressions can in principle isolate co-movement from idiosyncratic, and general risk-appetite (for example, proxied by spreads on non-euro risky bonds) from redenomination premium.