ECB's Trichet on EU and euro area enlargement

'While in some countries inflation is currently below the euro area level, inflation dynamics require high vigilance in some of the fastest growing countries,' Trichet said.

'To limit the inflationary impact of real convergence, it is therefore crucial that policymakers continue to pursue a policy directed towards macroeconomic stabilisation to avoid excessive domestic demand and the resulting price pressures in the countries concerned,' he said.

The new member states also need to focus on cutting their deficits, he said.

'Fiscal deficits are on average high or even very high in a number of new member states', he said.

'High lasting fiscal deficits can be expected to be impediments to economic growth,' he said.

Speech by Jean-Claude Trichet, President of the European Central Bank, Diplomatic Institute, Sofia, 27 February 2006.

Click here to read the speech "Looking at EU and euro area enlargement from a central banker's angle: the views of the ECB"