to check. our single currency is a key step within the on - going process of european integration. the euro banknotes have become the most visible symbol of that process. the euro has become moreover a symbol of solidarity in times of crisis, with the euro area assisting countries that have to go through tough but necessary adjustments. with the support of their european partners the spanish authorities have been decisive in embarking on a financial adjustment programme that has helped to clean the balance sheets of the weakest banks and recapitalised them with fresh funds. this has laid the foundations for a revival of the flow of credit to the real economy. allow me a personal remark, that i have the greatest respect for the spanish people who are experiencing hard times but are sticking to their commitments and responsibilities. ladies and gentlemen, i sincerely hope that you will enjoy visiting the new face of the euro exhibition. without further ado, it is a pleasure for me to declare the exhibition open. bis central bankers ’ speeches

of the exchange rate to price levels, this program has brought about a considerable lowering of the inflation rate. unfortunately, the rapid appreciation of the us dollar against the euro in the international markets has somewhat weakened the effect of the exchange rate basket on inflation. during the first ten months of this year, the turkish lira depreciated by an average 26. 5 % against the us dollar, but by an average 6. 5 % against the euro. the operation of the pass - through mechanism to price indices in turkey is much stronger for the dollar than it is for the euro, or previously was for the deutsche mark. turkish inflationary expectations have been following the behavior of the us dollar. under these circumstances, inflation outcomes have lagged above the targeted level. in addition, due to the preannounced depreciation path of the turkish lira against the currency basket, the continuous depreciation of the euro against the dollar has resulted in a loss of competitiveness of turkey vis - a - vis europe. due to this chain of events, the total value of turkey ’ s imports from the eu countries has risen 29. 6 % in the first half of the year, while the value of turkey ’ s exports to eu countries has grown by only 3. 4 %. in other words, the depreciation of the euro has contributed to turkey ’ s growing trade deficit, which was initially mistaken for a side effect of the disinflation program. in this situation, the correction of the euro ’ s value against other major currencies will have a beneficial effect on turkey ’ s current account balance, in addition to the offsetting of the negative effects of the weak euro provided by the high productivity of our manufacturing sector and the diversified nature of our exports. the weak euro has also led to a portfolio shift in the turkish economy. at the end of september, total foreign exchange deposits in turkish commercial banks amounted to us $ 43 billion. of this 27 % consisted of euros, which have decreased in value by 38. 5 % since the end of 1998. the share of us dollars gradually increased during the same period from 58 % to 71 %. at the central bank, we have also shifted the currency composition of our reserves from euros to us dollars. the share of euros in our reserves has fallen from 73 % to 54 %, and there has been a parallel shift in the composition of our foreign exchange liabilities. now let me point out two major positive effects of introducing