There is therefore no reason to be concerned that the ECB is neglecting the implications of exchange rate developments for the euro area economy. In this context, there are, however, a couple of issues that need to be borne in mind.
It is important to note that, with the introduction of the single currency, the importance of the exchange rate for the cost and price competitiveness of an individual euro area country has declined significantly. Nowadays, more than 50% of the euro area countries’ external trade is with other euro area trading partners and is therefore not affected by exchange rate developments.