one policy instrument would interact with the others. this evolution in the policy toolkit has been fully reflected in the evolution of the ecb ’ s approach 12 / 15 bis central bankers'speeches to forward guidance in the different phases of the crisis. forward guidance on interest rates was first adopted in july 2013 as a means to insulate the euro area from the global financial turmoil that had followed the so - called taper tantrum episode a few weeks earlier. this proved to be an effective firewall. but the subdued inflation outlook, as well as other headwinds to the euro area recovery, stemming from, for instance, subdued bank credit, required a more comprehensive policy package. so in the summer of 2014 we launched a complex package of policy measures that were to be adopted in a sequential and state - contingent manner as economic conditions evolved. given the essential interaction between policy tools in their transmission to the economy, the ecb accompanied the expanded asset purchase programme that it announced in january 2015 with an adjustment to the forward guidance framework, moving from a previously singular focus on policy rates to a dual approach combining and integrating the different elements of guidance on policy rates and asset purchases ( see figure 8 ). 7 communication about the intended horizon of net asset purchases and the expected future path of policy rates has been a key component of our policy strategy. our forward guidance on policy rates has acted as an enabling condition for the purchases to exert their full impact. in the absence of reassurances that policy rates would remain anchored around levels close to their lower bound for the entire life of the net purchases, the downward impact of asset purchases on term premia could have been partly neutralised by expectations of rate increases. at the same time, the conditionality attached to the intended horizon and size of our net asset purchases has reinforced the signalling power of our forward guidance on rates. 13 / 15 bis central bankers'speeches. conclusion monetary policy communication faces several distinct challenges. it has to be accessible to and useful for a variety of audiences. it has to be consistent in diverse economic circumstances. and it has to clearly convey the central bank ’ s reaction function, also when the latter entails a diverse set of instruments. to meet these challenges, the ecb ’ s communication uses a broad range of channels to express the governing council ’ s policy intentions at euro area level and to explain it to national audiences. it has made further efforts to make this reaction function understood by markets and the broader public, not least by

proposed composition of the systemic risk council reflects a recognition of the role played by central banks in macro - prudential supervision. third, the fact that the systemic risk council would be set up under the auspices of the ecb and the escb would allow it to benefit from the analytical capabilities and technical infrastructures developed by central banks in its analysis of monetary and financial stability. in this context, the systemic risk council will have to rely on a wide range of macro - and micro - prudential data. this implies that the ecb and the escb should have access to the relevant micro - prudential information from supervisors. fourth, for the proposed macro - prudential framework to function as intended, it is crucial that risk warnings be translated into policy action as effectively as possible. in this context, the systemic risk council should report its risk warnings and relevant recommendations to the ecofin council. finally, we should provide an appropriate institutional basis for the establishment of the systemic risk council and the related new macro - prudential tasks of the ecb and escb, in order to ensure the necessary authority, accountability and legal capabilities. the activation of article 105 ( 6 ) of the treaty could be a very useful avenue in this context. * * * i could not conclude today ’ s introductory remarks without very warmly thanking you, madame la presidente, and all the honourable members of the committee for our regular exchanges of views over the past five years. these 21 hearings have been important opportunities to receive feedback from the members of parliament. thank you for your kind cooperation and thank you for your attention.