christine lagarde : twenty - five years of the european central bank opening remarks by ms christine lagarde, president of the european central bank, at the celebration to mark the 25th anniversary of the european central bank, frankfurt am main, 24 may 2023. * * * it is a pleasure to welcome you to this reception marking the 25th anniversary of the ecb and the eurosystem. helmut kohl, the former german chancellor, once famously observed that " peace means more than just an absence of war ". and at its root, the story of the euro is one of building the foundations for lasting peace. it is a story that stems from europe's far - sighted decision after the second world war to bind its economies together so tightly that our futures would be inseparable, and which, in turn, created the powerful logic underpinning european integration. this engine of integration meant that whenever we faced trials, we did not retreat into division and let what we had built together fail. instead, we met those challenges head on and answered them together. and it was this same spirit that made – from the late 1980s onwards – the single currency a necessary next step on our european journey. at that time, both europe and the world were changing. first, our common market was evolving into the single market. this made it even more important to remove the prospect of competitive devaluations among major economies, since that would have undermined trust and turned the tide against openness. but with global capital flows multiplying, europe's fixed exchange rate system was becoming increasingly unstable – a problem epitomised by the exchange rate mechanism crisis in 1992 - 93. second, the global integration of finance was also threatening europeans with a loss of monetary sovereignty. the monetary policies of large countries that issued global currencies – especially the united states – were exerting ever - larger global effects. 1 regardless of the exchange rate regime used, this meant that the scope for smaller countries to set monetary conditions in line with their domestic needs was gradually narrowing. third, as the berlin wall fell and the cold war ended, there were new, fundamental questions being asked about the direction of europe – and who would hold sway within it. that created a powerful need for new european symbols that could tie people within a larger and more diverse union. 1 / 5 bis - central bankers'speeches the euro was the logical answer to all three of these changes. it offered europeans stability, sovereignty

bis - central bankers'speeches of course, instability has arisen in other areas that were missing from the original design of the euro area, most painfully during the sovereign debt crisis. but where gaps have appeared, they have been filled, most importantly through the creation of european banking supervision. second, the euro has increased our sovereignty, allowing us to be the master of our own economic destiny and to set the monetary policy that europe needs for stable prices and sustained growth. thanks to our single monetary policy, the ecb has been able to respond quickly and decisively to every kind of shock we have faced. and we have done so even when other large jurisdictions were pulling in a different direction. this was perhaps most visible when the us federal reserve system began a tightening cycle in 2013 while the euro area was still recovering from the sovereign debt crisis. our policy independence allowed us to chart our own course and begin a recovery that lasted for 26 straight quarters. third, the euro has created solidarity within europe. it has provided a symbol of unity through incredibly testing times, and motivation to support each other through the darkest of hours. and for this reason, new countries continue to join. over the past quarter of a century, we have welcomed nine new countries to the euro area, bringing us from 11 to 20 – with the most recent, croatia, joining at the start of this year. we have now reached a position where people can separate institutions from policies – which in my view is the hallmark of success. they may like or dislike the policies of the ecb, but they mostly no longer question whether being part of the euro area is the right choice. while the share of people who support the euro hit a low of around 60 % during the sovereign debt crisis, that figure is now close to 80 %. 5 and the depth of this support has also been demonstrated at the ballot box whenever membership of the euro area has featured in national elections. looking forward but this success does not mean that our work is done. it means that we are now in a position to make the best choices for our monetary union – rather than about having a union at all. it is now time for the next chapter in the euro's story to be written. and that will depend on the actions that we, as europeans, undertake. for the ecb, our immediate and overriding priority is to bring inflation back down to our 2 % medium - term target in a timely manner. and we will do so. 3 /