##ibility of the euro led to a sharp increase in sovereign bond and bank lending rates in some countries. in order to safeguard the singleness of monetary policy and ensure a smoother transmission of interest rates to the real economy, the governing council announced in august its readiness to undertake outright monetary transactions ( omts ) in secondary markets for sovereign bonds. the announcement of omts has proven to be an effective backstop against unfounded fears of reversibility. however, the transmission channel cannot be fully repaired if governments do not address the root causes of the crisis ; this includes ensuring sustainable public debt bis central bankers ’ speeches levels, improving competitiveness, strengthening bank resilience and further improving the institutional setting of emu. economic policies and emu governance the financial and sovereign debt crises left significant scars on public finances in the euro area. the government debt ratio increased by around 25 percentage points between 2007 and 2012. this reflected the workings of automatic fiscal stabilisers and discretionary expansionary measures to sustain incomes in times of falling economic activity, the sizeable public support to the banking sector, and, in some cases, the continuation of unhealthy fiscal trends. since 2010 a number of euro area governments have embarked on a determined consolidation path. as a result, government deficit ratios declined significantly from their peak levels. in 2012, the euro area government deficit - to - gdp ratio was about 3 percentage points lower than the deficit recorded in 2009. fiscal adjustment has been particularly strong in countries under market pressure. in greece, for example, the structural primary balance is estimated to have improved by more than 14 percentage points of gdp between 2009 and 2012. the improvement was 5. 7 percentage points for portugal, 4. 3 for ireland, 3. 9 for spain and 3. 6 for italy. past and current consolidation efforts are gradually bearing fruit. economic adjustment, both internal and external, has been significant, has implied high costs in terms of unemployment and should not put into risk of unraveling now. this will allow debt ratios to stabilise and subsequently to decline to safe levels. in order to generate growth and reduce unemployment, continued efforts to consolidate public finances should be accompanied by determined structural reforms, thereby promoting a mutually reinforcing process between restored fiscal sustainability, financial market access and future economic growth prospects. the structural reforms should be ambitious, broad - ranging and with long - lasting effects. they should address product markets, network industries, labour markets, and the modernisation of public administration. to

jean - claude trichet : a unique perspective speech by mr jean - claude trichet, president of the european central bank, at the celebration of the publication of otmar issing ’ s book “ der euro ”, frankfurt am main, 15 april 2008. * * * meine sehr geehrten damen und herren, es ist mir eine große freude, heute anlasslich der veroffentlichung von professor otmar issings buch uber den euro zu ihnen zu sprechen. der zusammenschluss von jetzt 15 eumitgliedstaaten in der europaischen wirtschafts - und wahrungsunion, mit dem euro als der gemeinsamen wahrung fur rund 320 millionen europaische burgerinnen und burger, ist einer der großten erfolge der wahrungsgeschichte. otmar hatte als direktoriumsmitglied der ezb in den ersten acht jahren ihres bestehens und als direktoriumsmitglied der bundesbank in den acht jahren davor maßgeblichen anteil an der erfolgreichen einfuhrung und etablierung des euro. sein buch bietet damit eine einzigartige perspektive auf die erfolgsgeschichte unserer gemeinsamen europaischen wahrung. why has the creation of the euro been a success story? of paramount importance is the fact that, right from the beginning, the ecb was able to establish, and then maintain, a high level of credibility to effectively safeguard price stability in the euro area. during the transition to the euro, market interest rates on instruments denominated in euro became aligned all along the yield curve with the lowest – and not with the average – rates prevailing in the euro area prior to the euro. this demonstrated that the ecb had managed to inherit the high level of credibility that had been achieved by the most successful national central banks joining the monetary union, in particular the deutsche bundesbank. you know how proud i was myself to have run a monetary policy that had given my own national currency the same level of credibility as the dm before the euro. the ecb has fully maintained this achievement during the now more than nine years since the start