At the same time, it would be very unfortunate, particularly in the light of the challenges facing the Swedish economy, to be forced to manage contagion effects from the energy price rise with interest rate rises. If one looks at the economic climate, I consider the similarities between the present situation and this time last year to be more striking than a comparison with 2001. Here I am mainly referring to the fact that economic prospects were at that time very uncertain with regard to how far the adaptation process had come after the over-optimism of the previous years, which had led to abnormally high share prices  and overly large investments by companies in the USA. Let me go back in time roughly one year and see what conclusions can be drawn from last year and what implications they might have for future developments. Developments 2002 to 2003 At the beginning of last year there were signs of a light at the end of the economic outlook tunnel. I wasn’t working at the Riksbank then, so don’t be surprised if parts of my historical description differ slightly from that of the Riksbank, as expressed in the Inflation Reports. The signs of a turnaround were most pronounced in the USA, but there were also some signals that Europe was on the threshold of a recovery. The reduction in stocks appeared to be well on its way, which is usually the first requirement for an upturn in production.
Vítor Constâncio: Reflections on financial integration and stability Speech by Mr Vítor Constâncio, Vice-President of the European Central Bank, at the Joint ECB-EC Conference on “Financial Integration and Stability in a New Financial Architecture”, Frankfurt am Main, 28 April 2014. *  *  *  Ladies and gentlemen, Dear colleagues and friends, It is indeed a pleasure to participate in this joint presentation of two important policy reports: the European Commission’s European financial stability and integration report 2013 and the ECB’s Financial integration in Europe 2014 report. Both studies illustrate that some steady, albeit uneven, progress is being made towards financial stabilisation. Banks are reducing their liquidity buffers, repaying our LTROs and regaining confidence from the markets. Money market integration is slowly improving, particularly in the secured segment. Quantity-based indicators confirm a stabilisation in bond markets and improved integration in equity markets. Given where we stood barely two years ago – on the edge of redenomination risks – such progress is encouraging. However, it does not mean we are entirely out of the danger zone. If we look at banking markets, there is still a large dispersion of borrowing costs for nonfinancial corporations across euro area countries. Thus, significant financial fragmentation still remains in the euro area. This is a concern for the recovery and also for monetary and macro-prudential policy. Under the pressure of the global financial crisis and the sovereign debt crisis in the euro area, several solutions – both global and European – have indeed been adopted.