Therefore, it is to the mutual benefit of both parties to co-operate in sharing information and analysis as they adjust their policy settings. Co-operation between the Bank and the federal Department of Finance occurs on a number of levels. I have frequent discussions with the Minister and Deputy Minister.
Discrepancies in average HICP inflation rates between the new Member States and the euro area dropped significantly from on 7.6 percentage points in 1997 to close to 1 percentage point in the last three years. Similar developments are evident for short-term and long-term interest rates – with the spreads falling on average to below 3 percentage points and above 1 percentage point, respectively.