Thirdly, money-market interest rates followed the repo rate downwards during 2003 and fluctuated around a horizontal trend in the first six months of 2004. Fourthly, yields on long-term government bonds, which had declined during 2003 to a low of 8,78 percent on 12 January 2004, rose to 10,26 percent on 15 June 2004 in response to rising inflation concerns.
In my view, it would be preferable to amend the EU treaties with a view to putting in place robust separation between monetary policy and supervisory decision-making structures. Isn’t such a separation at the ECB just theoretical anyway?