limited impact on the euro area, thanks to our monetary policy. we will watch closely to make sure that financial conditions are appropriate for the state of our economy. and the second conclusion, which is more general, more political, if you will, is that we are in a world full of uncertainties ( economic, political ) ; a framework for international cooperation is needed. so whatever decisions mr trump and his administration may take, what we want is for them to be analysed and discussed in an international context, particularly in the context of the g20, which is really the forum where such discussions should take place. aren ’ t you worried, however, about the protectionist measures that donald trump is planning in the months, the years, to come? again, nobody knows, it ’ s too early to know what he ’ s going to do exactly, but protectionism, right now, is clearly a bad idea. we live in a world where productivity and innovation ( the output of innovation, the spread of innovation ) are what matters to ensure prosperity. it is difficult to imagine that a world in which borders are closed to both goods and capital, and to the free movement of people, would favour innovation. so, economically speaking it ’ s a bad idea, yes. 1 / 3 bis central bankers'speeches protectionism is a bad idea. inflation has also returned to europe, but the european central bank is at the moment refusing to increase its interest rates. why? inflation is increasing, but for a reason which is very simple and easy to identify, which is the increase in commodity prices, or rather the end of a period marked by sharp falls in commodities. so it ’ s our job to understand to what extent that increase in the price of raw materials and food will have a lasting impact on inflation. at the moment, that is not the case. it ’ s something that we are watching and will watch carefully in the coming months. but for the time being, this increase is temporary and does not justify ending the ecb ’ s policy, particularly quantitative easing. in other words, very low rates, almost at zero, and liquidity injections through the markets, through asset purchases on the market. precisely. that day will come, the day when we have that discussion will come, and i will welcome it because it will be a sign that the economy is healthier, but today it ’ s still a little too early. when will that be? in 2018?

also applies to france, incidentally. 2 / 3 bis central bankers'speeches and the convergence you ’ re talking of – what does it mean for france? french growth is now picking up but it remains lower than that of germany and the euro area, so the reforms in france have to continue in order to consolidate growth. and that will allow france ’ s voice to be heard in the euro area. what are these reforms? i am not going to enter into a debate which is now an election debate. the reforms are... is it necessary to copy what germany has been doing for a decade, wage moderation alongside a more flexible labour market? yes, there is a need for a labour market which works in a more flexible way, but there must also be productivity, innovation and education enhancement policies, notably in higher education, to ensure that france remains at the forefront of innovation. and germany, for its part, must it also make efforts? yes, germany has implemented major reforms in the past from which it benefits today, but its demographic prospects are more difficult than those of france, so it too must continue with reforms, and in particular it must invest. last question, on the budget deficit. should europe be more tolerant of the sacrosanct 3 % objective? i don ’ t believe that this is an issue that concerns europe. indeed, france has been above 3 % for many years now, so it clearly shows that the problem doesn ’ t lie so much with europe, and it shows that there hasn ’ t really been austerity in france. france today, in 2017, is on the threshold of being able to pass below 3 %. do you think it will achieve that? france can achieve it. it will depend on the new government ’ s policies. i think it is important that france achieves it. i ’ m concerned, by the way, by the declarations of various candidates, on both left and right – this is not a question of politics – which envisage bouncing back, returning, to above3 %. what does that mean? it means that france ’ s public debt will continue to grow and i, as a french taxpayer ( because i am also a french taxpayer ), do not want france ’ s debt to rise to 120 % or 130 % of gdp. 3 / 3 bis central bankers'speeches