% annual growth. while the reference value plays an important role in monetary analysis, the assessment of the first pillar goes beyond the evaluation of deviations of m3 growth from the reference value. it encompasses a variety of approaches which assign a central role to money, as well as a detailed analysis of the components and counterparts of m3. monetary data on their own do not constitute a complete summary of all the information on the economy required to set an appropriate monetary policy for the maintenance of price stability. therefore, in parallel with the careful analysis of monetary variables, a broadly based assessment of the outlook for price developments and of the various risks to price stability in the euro area plays a major role in the ecb's strategy. this assessment is made on the basis of a wide range of variables influencing future price developments. this range includes, inter alia, the exchange rate, wages, unit labour costs, bond prices, the yield curve, fiscal policy indicators, various measures of real economic activity, price and cost indices. in addition to an in - depth analysis of the individual indicators, macroeconomic projections for real gdp growth and inflation are regularly made. while such projections facilitate the structuring and summarising of some of the individual factors, they can only provide a partial summary of the state of the economy. hence they are only one element of the second pillar. overall, the two - pillar approach has proven to be successful in the first just over two years of stage three, which were characterised by an above - average degree of uncertainty. the ecb's strategy is certainly rather complex, but - at the same time - it has the crucial advantage of guaranteeing that no piece of relevant information is left out in the policy analysis. regarding actual price developments, we have to admit that, after very moderate inflation in 1999, hicp inflation has been standing above 2 % since june 2000. however, this is due mainly to direct effects stemming from the external oil price shock. such a shock cannot be prevented by monetary policy. it is very positive under these circumstances that the public's trust in the ability and willingness of the ecb to maintain price stability has never faded. this is signalled, for instance, by the low and stable inflation expectations implicit in long - term interest rates. a high level of anti - inflationary credibility has been obtained in no easy times, which were characterised by an increase in headline inflation in the euro area in 2000 due to the oil price shock and the protracted

especially then – institutions must therefore stick to the reform path they have embarked upon. their willingness to do so is not just in the interests of the individual institutions. for it is only when banks and savings banks in germany fare well as a whole that they can fulfil their central economic function – and when they do that they ultimately serve us all. thank you for your attention. 1 deutsche bundesbank, monthly report, february 2017. 2 dombret, gunduz, rocholl ( 2017 ) : " will german capital? ", deutsche bundesbank discussion paper no 01 / 2017. banks earn their cost of 3 deutsche bundesbank, monthly report, september 2015. 4 the results of the last survey, at : www. bundesbank. de / 348250. carried out in september 2015, are available online 5 " the revolution is over. long live the revolution! ", speech by sam woods at the city banquet, mansion house, london, 26 october 2016. 5 / 6 bis central bankers'speeches 6 federal reserve bank of minneapolis, economic policy paper 13 - 3 : " quantifying the costs of additional regulation on community banks. " quoted in the economist ( 11 february 2017 ) : " the litter of the law. " 7 deutsche bundesbank, bank office statistics 2007, 2015. 6 / 6 bis central bankers'speeches