- term interest rates to be disconnected efficiently from us short - term interest rates. we will ensure that this continues. spanish, greek and italian sovereign rates have declined strongly in recent weeks although these member states still have high public debt. are the markets too optimistic? no, on condition that the reforms continue. international investors have confidence in the reform dynamic in euro area member states, including in greece. the level of the rates is only justified if the reforms are carried out as planned. this is true in small member states just as in the big ones. france has just announced 50 billion euro worth of savings and is slow to implement reforms. is france lagging behind? france has not been under the same pressures or financial stress as the peripheral countries of the euro area. france has enjoyed investor goodwill and has been fortunate to be able to decide for itself on the rhythm of its reforms. but that does not mean that the reforms are any less necessary. the ecb has begun assessing banks ’ balance sheets before the start of banking union. could the discovery of weaknesses in large institutions trigger another crisis? at this stage it is too early to say what we will find. but one thing is certain : for confidence in the banking system to be restored, each time a bank has insufficient capital reserves, the gap will need to be filled quickly. and this following a well - defined procedure : first, having recourse to the bank ’ s internal resources, then markets and finally – and only in the event that this is not enough – to public authorities at national or european level in compliance with state aid rules. governments in the euro area have for that matter undertaken to follow this procedure if the situation requires it. with the banking union, the ecb will be responsible for banking supervision in addition to monetary policy. is that not too many powers in the hands of one sole institution? it is true that the ecb will have more powers. but, as in any democratic system, it will have strong counterparts. in banking supervision just as in monetary policy, the ecb will be accountable for its decisions in accordance with the procedures which have been agreed with the european parliament. how will the ecb stand up to any political pressure in this regard? the ecb has already demonstrated its ability to withstand pressure. indeed, it is not only a question of being independent of governments but also of financial lobbies. bis central bankers ’ speeches

benoit cœure : interview in le monde interview with mr benoit cœure, member of the executive board of the european central bank, in le monde, conducted by ms marie charrel on 17 april 2014. * * * is the level of government debt in the euro area sustainable? the euro area countries have already greatly reduced their deficits. now that growth is returning, continued efforts in this regard will allow debt - to - gdp ratios to be reduced. the measures required of countries subject to a financial assistance programme under the troika have had a recessionary impact stronger than that forecast by the international monetary fund ( imf ), particularly in greece. have we gone too far with austerity? the financial assistance provided by the european union and the imf gave these countries time to change the course of economic and financial trends that were no longer sustainable. remember that had no financial assistance been provided, the adjustment would have been much more abrupt. the need for restraint is now lessening in the euro area, but not because debt is back in fashion! it is down to the fact that most countries have already taken the toughest measures and are now starting to reap the benefits. is the current level of the euro too high? there is a particular fascination with the exchange rate in france that is not shared by other euro area countries. no doubt this has something to do with the fact that france is one of the only countries in the euro area whose external accounts are in the red. however, the euro area as a whole is running a current account surplus : the solution for france, therefore, is to improve its competitiveness, which is indeed what the government plans to do. this is not to say that the ecb is not concerned about the exchange rate ; it is rather that the ecb does not have an exchange rate objective. the exchange rate is one of the factors that we take into account in deciding on our monetary policy stance. the important thing for us is to know whether the level of the euro exchange rate and its outlook are likely to hinder the return of inflation rates to below, but close to, 2 %, which is our definition of price stability and which lies at the heart of our mandate. there is no doubt that the appreciation of the euro since the summer of 2012 has contributed to the current low level of inflation. all other things being equal, the stronger the euro, the more an accommodative monetary policy is justified. the low