done better, or where improvements can - and should - be made. for example, we have to acknowledge that the cash changeover did have some undesirable effects on prices, in connection with their conversion from national denominations into euro. the irritation caused by some disproportionate price increases, especially in parts of the service industry, in a number of euro area countries, gained a lot of unfavourable publicity. even though our statistics show that the cash changeover had a rather small one - off impact on inflation of around 0. 1 % to 0. 3 % on average across the euro area, people had the impression that inflation was much higher than the recorded change in the consumer price level. this gap between “ perceived ” inflation and actual inflation has gradually got smaller, though at a puzzlingly slow pace. we should not forget either that the introduction of the single european currency represented a fundamental regime shift which clearly required certain adjustments in the way monetary policy - makers communicate with markets and the public. in 1999, the ecb was a new, unknown central bank ; it had no history of decision - making. its two - pillar monetary policy strategy was a novelty in the world of central banking ; its economic environment was, and is, a heterogeneous, multi - country economy, and its political setting unlike anything we know from the nation - state. it is therefore hardly surprising that communicating the ecb ’ s monetary policy has been a real challenge which has meant for all of us - the eurosystem at the sending end, and the markets and the public at the receiving end a process of learning and adapting. it also took some time for the markets to fully understand our monetary policy strategy, that is, the conceptual framework on the basis of which the governing council assesses the economic outlook and the risks to price stability, takes decisions about the appropriate monetary policy stance, and explains these decisions to the markets and the public. by now, the understanding of our strategy has greatly improved, and the recent evaluation and clarification of the strategy has certainly helped to this end. the ecb today ranks as one of the most open, transparent and predictable central banks in the world, and we continually seek to improve our communication. overall, a lot has been achieved on this front, but improvements can still be made in other areas. for instance, much more progress remains to be made in respect of the integration of european financial markets. as economic theory would predict

, the single currency has eliminated exchange rate risk and lowered transaction costs. this has indeed significantly reduced borrowing costs in the euro area. deeper, broader and more liquid continent - wide financial markets have emerged, which have reduced liquidity risk premia, improved access to external finance and cut financing costs. thanks to the credibility of the ecb ’ s monetary policy, the euro area ’ s low inflation environment has reduced inflation risk premia, and interest rates have remained lower and more stable across the maturity spectrum than would otherwise have been the case. all very positive indeed, i would say, but not quite “ top of the class ”. if we take the deep, liquid and unified us financial markets as a benchmark, the euro area clearly still has some way to go, especially as regards the integration of equity markets, the establishment of common legal and regulatory frameworks, and the consolidation of the banking sector. so, if we add it all up and look at the euro ’ s scorecard after five years, i would say the result looks quite impressive. however, having extolled the successes of the euro “ at home ”, i do not want to create the impression that europeans have a particular penchant for navel - gazing and that europe is “ obsessed with its own internal dynamics. ” so now i will turn to the global impact of the euro, and notably its international role, a very fitting subject for this international symposium. iii. the international role of the euro back in 1998, before the launch of the euro, some policy - makers and economists predicted that the euro would quickly develop into an international currency. the new single currency zone would represent the world ’ s largest trading area and an economy with a combined gross domestic product of some €7 trillion. and the euro ’ s legacy currencies, notably the deutsche mark, had already established a certain international status. some expected - or even hoped - that the international role of the euro would rival that of the us dollar. i should add that among central bankers, we always refused to frame the discussion in such terms. five years on, where do we stand? the international role of a currency is a complex phenomenon, so let me first look at the international private use of the euro, that is, its use by international borrowers, investors and traders. afterwards, i will consider the international official use of the euro, that is, its use as an intervention, reserve and anchor currency. i will conclude with a