##ring. we will take any measures necessary to ensure that we deliver on our inflation target of 2 % over the medium term. that is why, at our last governing council meeting, we recalibrated our policy measures, allowing for a step - by - step reduction in the pace of our net asset purchases, moving gradually from around €80 billion per month to €20 billion per month over the course of 2022. 2 we also ensured that we have the flexibility to respond to a range of circumstances. at the same time, we concluded that monetary accommodation is still needed for inflation to settle at 2 % over the medium term. strengthening supply monetary policy works on the demand side of the economy by stabilising output around its potential level. but the level of potential output is mostly affected by the actions of other policymakers, besides the hard work of people and the strength of businesses. and this brings me to the second area on which we need to build : strengthening supply. there are structural changes taking place in the economy today which could have a profound impact on the supply side of the economy. the green transition, the digital revolution and demographic shifts have all been accelerated by the pandemic. if we are to achieve sustainable growth in the future, supply and demand need to move together as the economy adjusts to these changes. for example, the economy is already becoming greener as consumers change their behaviour and new regulation bites. and i am confident that this will ultimately provide a new source of growth for europe : nine of the top 20 global players developing green - digital patents are european. 3 but if supply capacity cannot adjust quickly enough, the transition could be bumpy. one possible consequence, as i have discussed elsewhere, is greater volatility in energy prices, as bridge technologies like natural gas have to be used to fill gaps in energy production. 4 and there is a risk that this could affect public confidence in decarbonisation. so the solution has to be to accelerate investment in renewables – and other green technologies – so that they come 2 / 5 bis central bankers'speeches online faster. we are fortunate in europe that our policy response has not only focused on stabilising demand, but also on redirecting supply towards the sectors of tomorrow. ngeu is a unique tool that can provide the investment impetus we need. it is critical that it becomes a complete success. you, national parliamentarians, now have the opportunity to ensure a swift and effective implementation of the reform

and investment plans presented by member states. that said, we will not be able to rely on ngeu alone to reorient our economy towards the future. it has a capacity of €750 billion until 2026, but achieving the green transition will moreover require additional investments of €520 billion per year by 2030. 5 catching up with leading digital competitors – the united states and china – will require an additional €125 billion per year. 6 if we are to close this gap, we also need to find ways of unlocking the large pool of private investment in europe and across the world. for that, we need a robust, integrated and diversified eu financial sector. this is one key reason why, in addition to completing the banking union, we need to further deepen europe ’ s capital markets. last year, i called for us to focus in particular on completing a “ green capital markets union ”. 7 this is because equity investors are more suitable to finance riskier and more innovative projects, which are key to the digital and green transition. we also have a first - mover advantage in green finance, with 60 % of global green bond issuance taking place in the eu. so how can we move forward? at european level, the legislative proposals recently published by the european commission under the capital markets union action plan provide a good basis for discussion with the colegislators. but we need to see progress at the national level, too. tax and regulatory reforms aimed at supporting equity and venture capital investments are a key ingredient in deeper capital market integration. ensuring strategic autonomy taking these steps will create a stronger and more dynamic european equity landscape, which at the moment unfortunately lags behind our international peers. this, in turn, would strengthen europe ’ s strategic autonomy, or, in other words, develop a higher degree of european sovereignty. this is the third area where i see potential to build on what we have achieved during the pandemic. we have taken several steps over the last two years that have bolstered our autonomy in the world. our improved policy mix has helped strengthen our internal demand, making our growth more robust in a more uncertain global landscape. 8 ngeu has increased the credibility of eu bond issuances as a new class of common european safe asset, boosting the international role of the euro. and if the reform plans embedded in ngeu are implemented diligently, it will validate and strengthen the confidence being expressed by financial markets in this