olli rehn : disinflation on track amid geopolitical uncertainty remarks by mr olli rehn, governor of the bank of finland, at the ubs european conference, london, 12 november 2024. * * * let me first thank ubs for kindly inviting me to address this distinguished audience. to kick off, i will briefly discussthe economic outlook in the euro area and the ecb's monetary policy approach. overall, it is fair to say that the ecb's monetary policy has been relatively successful in taming inflation. rate hikes have helped keep inflation expectations anchored to around 2 %. somewhat unusually for a tightening cycle, the euro area appears to have avoided recession, and unemployment has stayed at a record low. the ecb's inflation target was revised in 2021, and the revised symmetric target of 2 % over the medium term has worked well during the past poly - crisis years. the big picture now is that disinflation in the euro area remains well on track. in october, inflation stood exactly at 2 %, and it is expected to stabilise more sustainable next year. the progress with disinflation has prompted us to make three 25 bp. rate cuts since june. even though a soft landing seems plausible in the euro area, growth is projected to remain sluggish. the manufacturing sector, in particular, is underperforming, not least in germany but also elsewhere. what does this imply for monetary policy going forward? as you may be aware, we have been preaching and practising data - dependency. so, i am indeed looking forward to our december broad macroeconomic projections, especially on two issues. will the projections indicate that inflation is stabilizing at our 2 % target in early 2025 already? will they confirm the weakening of growth momentum? as for the ecb's monetary policy stance, we are approaching a neutral level of interest rates – although nobody knows exactly when this will be reached. the direction of rate changes is clear, but the speed and scope of rate cuts will depend on our overall assessment at each meeting of three factors : the inflation outlook, the dynamics of underlying inflation and the strength of monetary policy transmission. the question in the title of the panel – how far and how fast do we move in reversing the tightening cycle? – can also be tackled by scrutinising the natural rate of interest, r *. r * provides a meaningful analytical framework for thinking

olli rehn : new avenues for monetary policy opening remarks by mr olli rehn, governor of the bank of finland, at the bank of finland centre for economic policy research ( cepr ) joint conference “ new avenues for monetary policy ”, 10 september 2021. * * * ladies & gentlemen, dear friends, good afternoon and welcome to this conference on new avenues for monetary policy, which is jointly organized by the bank of finland and the centre for economic policy research. our collaboration with cepr in organizing annual conferences has a long and successful history, for which we are grateful. we are very happy and honoured to have several leading experts in the field to address us at this conference, including alan blinder, markus brunnermeier, mikhael golosov, ethan ilzetzki, loretta mester and michael woodford. the scientific committee have done an excellent job in putting together a high - quality programme for the next two days. this conference takes place against the backdrop of the covid - 19 pandemic, from which the global economy is now recovering rapidly, if unevenly. in the euro area yesterday ’ s fresh projection by the ecb foresees, the economy is rebounding significantly this year on the back of the expected re - opening of the economy, strengthened policy support and economic recovery in the rest of the world. real gdp is projected to grow by 5 % this year and 4. 6 % next year. the key underlying assumption for the current view is that containment measures can be relaxed rapidly in the second half of the year. with regard to inflation, the harmonized index of consumer prices is forecast to peak in the fourth quarter of this year, with annual inflation reaching an average of 2. 2 % this year, supported by temporary factors, such as strong base effects caused by energy inflation and the german vat rate reversal, and an increase in input costs related to supply bottlenecks. in 2022, inflation is expected to be 1. 7 % as the temporary factors fade, and stay at 1. 5 % in 2023. after the worst crisis phase was over, the ecb governing council continued its once - postponed review of monetary policy strategy. the review, the first since 2003, was concluded in july this year. high - quality analysis and extensive dialogue between research and policy - making were crucial for reaching pertinent conclusions. we reviewed the definition of price stability, monetary policy instruments and their effects – both the main