are no longer in place. in any case, we can withdraw the ample liquidity created as a side effect of the long - term operation whenever the governing council deems liquidity conditions are excessive in view of the outlook for price stability. all the tools necessary for large - scale liquidity withdrawal are already in place or will be readily available when needed. this is consistent with our monetary policy strategy. it emphasises the monitoring of monetary and credit developments, which are linked to both financial imbalances and threats to price stability over longer horizons. it ensures a more symmetric policy with respect to bis central bankers ’ speeches financial misalignments and some “ leaning against the wind ” if monetary trends signal inflationary pressures over and beyond what standard conjunctural analysis and macroeconomic projects imply. 4 conclusion in conclusion, i return to where i started : the transmission mechanism and how a stabilityoriented strategy can influence its multiple paths ( see slide 24 ). the most important link in the long chain is the monetary policy strategy. clarity about the objective and about the key indicators can anchor expectations and empower monetary policy decisions. as you know, adjustments to expectations can amplify any action taken by a credible central bank. our strategy has supported this mechanism in normal times. in crisis times, as markets ceased to transmit price signals, our tools had to change. the eurosystem ’ s response has been timely ; all non - standard measures have been temporary and tailored to the special features of the euro area. our tools have changed but our strategy has not – it is in fact supporting a gradual process of normalisation. the euro area is an economic and monetary union ( emu ). its monetary pillar has performed well so far and will continue its work in the future. the economic pillar is now being considerably strengthened. the new fiscal framework should now be promptly ratified and forcefully implemented under the leadership of the european commission ; as a complement, growth initiatives will be welcome, insofar as they address the long - term growth potential. see fahr, s., r. motto, m. rostagno, f. smets and o. tristani ( 2011 ) “ lessons for monetary policy strategies from the recent past ” in “ approaches to monetary policy revisited – lessons from the crisis ”, ed. m. jarocinski, f. smets and c. thimann, pp. 26 – 67, european central bank. bis central bankers ’ speeches bis central bankers ’

must focus on containing persistent trends in inflation. distinguishing between temporary and more persistent shocks to inflation is therefore crucial. experience has shown that paying attention to specific measures of “ core inflation ” may mislead monetary policy. an overly mechanical view of such indicators can lead to an underestimation of the strength of inflationary pressures at the global level. third, policy decisions should have been based on better models of monetary policy transmission. monetary and financial factors have been too easily dismissed, especially by inflation targeting regimes. placing greater weight on monetary and credit indicators should allow interest rate decisions to be better calibrated to achieve the appropriate medium - term objectives of monetary policy. can central banks learn from experience? they can if they are able to recognise what went wrong, rather than sweeping the hard questions under the carpet, and if they are able to adapt their analytical and decision - making framework. suggesting that monetary policy had nothing to do with the crisis will not help, and might encourage us to make the same mistakes in the future. the reaction to the crisis has however shown that central banks learn fast and can take decisive action to protect the economy. their response is in stark contrast to how they reacted to the great depression. on that occasion, monetary policy - makers were largely responsible for causing the crisis, for deepening it and for preventing a quick recovery. we can be more optimistic this time around.