16 See Krozner, R. and Strahan, P. (2014), “ Regulation and Deregulation of the U.S. Banking Industry: Causes,  Consequences, and Implications for the Future", in Economic Regulation and Its Reform: What Have We Learned?, National Bureau of Economic Research. 17 See Morgan, P., Rime, B. and Strahan, P. (2004), “Bank Integration and State Business Cycles”, The Quarterly  Journal of Economics, Vol. 119, Issue 4, 18 European Commission estimates. See Nikolov, P. (2016), op. cit. 19 See Milano, V. and Reichlin, P. (2017), “Risk-sharing across the US and EMU: the Role of Public Institutions”,  Policy Brief, LUISS School of Political Economy. 20 Tier 1 capital to total assets. 21 ECB (2018), “Box A: What could enhance private financial risk sharing in the euro area?”, Financial Integration in  Europe. 22 For a more detailed explanation, see ECB (2017), “Special feature: Cross-border bank consolidation in the euro  area”, in Financial Integration in Europe. 23 See Carmassi, J. et al. (2018), “Completing the Banking Union with a European Deposit Insurance Scheme:  who is afraid of cross-subsidisation?”, Occasional Paper Series, No 208, ECB. 24 This includes guaranteeing the assets or the liabilities of the institution under resolution; making loans to or  purchasing assets from the institution under resolution; and making contributions to a bridge institution and an asset management vehicle. See srb.europa.eu/en/content/single-resolution-fund. 25 Sapir, A. and Wolff, G. (2013), “ The neglected side of banking union: reshaping Europe’s financial system”, note  presented at the informal ECOFIN on 14 September 2013, Vilnius.

They are likely to stay slightly above 2%, largely owing to commodity price developments, before moderating again towards the end of the year. Overall, we see evidence of short-term upward pressure on overall inflation, stemming largely from global commodity prices. While this has not so far affected our assessment that price developments will remain in line with price stability over the policyrelevant horizon, very close monitoring of price developments is warranted. Inflation expectations over the medium to longer term continue to be firmly anchored in line with the Governing Council’s aim of keeping inflation rates below, but close to, 2% over the medium term. Risks to the medium-term outlook for price developments are still broadly balanced but could move to the upside. Upside risks relate, in particular, to developments in energy and nonenergy commodity prices. Furthermore, increases in indirect taxes and administered prices may be greater than currently expected, owing to the need for fiscal consolidation in the coming years, and price pressures in the production chain could rise further. On the downside, risks relate mainly to the impact on inflation of potentially lower growth, given the prevailing uncertainties. Turning to the monetary analysis, the annual growth rate of M3 increased to 1.9% in November 2010, after 0.9% in October. This strong increase is in part related to base effects and volatile factors. The annual growth rate of loans to the private sector also increased, rising to 2.0% in November from 1.5% in October.