Bernard Durkan (Kildare North, Fine Gael)
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Question 71: To ask the Minister for Finance the extent to which an effort continues to be made to examine the wisdom of the use of interest rate increases as a means of combating inflation in view of the likelihood that such increases are ultimately most likely to penalise EU countries with the greatest debt liabilities and consequently their ability to repay debt with obvious consequences for the future of the European Union itself; and if he will make a statement on the matter. [20355/11]

Michael Noonan (Limerick City, Fine Gael)
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The policy interest rate is a key tool for controlling inflation in many regions. In the euro area, the independent European Central Bank (ECB) is responsible for monetary policy and has sole discretion for policy interest rate movements. The ECB's requirement is to maintain price inflation in the euro area as a whole, close to but below 2%. The latest estimate for the Harmonised Index of Consumer Prices in June was 2.7% for the euro area. For indebted euro area member states, the best way to reduce the burden is to implement fiscal consolidation measures and to enhance the economy's growth capacity by implementing structural reforms and boosting competitiveness.