The relatively weak exchange rate of the euro has naturally favoured European exports, but that is a short-term advantage, because an economy’s competitiveness needs to be based on factors other than a weak currency. Furthermore, it has increased the cost of our imports. We have realised that as oil prices have risen, so that is a factor which can push up inflation.
It is important to stress, however, that the improved outlook for the global economy points to the possibility of addressing old problems and facing new challenges with a higher probability of success. This is particularly true for the euro area economy where the outlook for growth has recently improved, contributing to more optimistic prospects at the global level.