you look today at the results obtained in terms of the yield curve and inflation expectations, you can appreciate the strategy followed by the ecb in the rate - cutting phase. one point on which i don ’ t agree with franco bruni ’ s analysis concerns his judgement on changing the objective of monetary policy after the failure of lehman brothers on 15 september 2008. bruni writes : “ … the objective became only that of saving the credit system from the collapse. this last change of objective is of great conceptual and political importance, it has a significance that could prove to be, so to speak, historic. and yet it has never been officially declared, particularly by the ecb ”. the proof that he provides for the above remarks is the decision to reduce interest rates from 2 % to 1. 5 % in march this year, a step which, in his opinion, was not justified by the trend of the economy, but by the problems facing europe ’ s banking system. there is a misunderstanding here that needs to be quickly clarified, also in view of the ensuing discussion on macro - prudential supervision and on the powers of the central banks in question. from the outset of the crisis in august 2007, the ecb has pursued a policy of separation between, on the one hand, the interest rate decisions, based solely on the priority objective of price stability and, on the other hand, the decisions concerning the instruments used to pump liquidity into the system in order to tackle the difficulties being encountered by the market. the most obvious example of the separation is precisely the one which occurred on 9 august 2007, when amid market tensions, it was decided both to maintain the rates unchanged and to intervene on a substantial scale to satisfy the banks ’ demand for liquidity, with a €90 billion operation. and the same separation has been continued in all the months since then. that the decision to reduce interest rates in march to 1. 5 % was justified is, i believe, evident from the growth and inflation estimates published at that time. i remember the ecb staff projections were pointing to euro area gdp growth for 2009 and 2010 being equal to - 2. 7 % and 0. 0 % and inflation of 0. 5 % and 1. 1 % respectively. also taking into account the relevant horizon for monetary policy, between one and two years ahead, an interest rate of 2 % “ three questions on monetary policy easing ”, university of ancona, 6 march 2009 ( available at www. ecb.

in spain, italy and portugal, to better support early rescue of viable firms, to help the deleveraging process and to free up resources for further investment and thus productivity growth. i believe that these reforms, if the effort to implement them continues, will help us to grow out of the current high private sector debt problem. of course, there are other possibilities and the list of potential reforms is long. i could elaborate further, but my time here is unfortunately limited so i chose to constrain myself to this crucial area of structural reforms. conclusions let me now conclude. as i said at the beginning, the euro area can make a much stronger contribution to global growth than it has done so far. the conditions are very favourable for a strong push for reforms ; in particular, our monetary policy stance is supportive. reforms should now focus on boosting productivity and reducing the burden of the high debt stock. work in this direction has started and is ongoing, but the euro area governments need to continue on this track with more determination and impetus. bis central bankers ’ speeches