or whenever you deem it necessary. this relates to the credibility of the monetary targets and inflation expectations as an anchor, as a frame of reference where the general public, the consumers, and the companies can act. and it must be acknowledged that we have built on the basis of a credibility that has increased over the last few months. first, there is a consensus on inflation expectations, as shown in the survey conducted by the central bank among more than 50 research agencies, consulting firms, etc. ( survey on market expectations ). the range we have included here, which also appears in the 3 - year program as agreed upon with the international monetary fund for next year, is between 5 % and 8 %, and 7. 9 % as per the budget. let us see how expectations are falling halfway through these figures, which implies that the targets set by the central bank are credible because everyone expects the inflation rate to drop between 5 % or 8 %. in terms of distribution, i. e., the number of firms, consultants or foundations forecasting inflation between 7 % and 9 %, there are no great differences concerning expectations. this means, as reported, that the central bank ’ s monetary policy is credible both for the general public and the analysts. the central bank has been showing a consistent monetary policy and has set quantitative targets considering the severe instability suffered in recent years. therefore, the bank has adopted a monetary base and has set an expanded monetary base as a target, which has allowed us to move forward. however, i am convinced that the best way to work in future is by establishing an inflation targeting policy. as to monetary issues, in recent months the monetary base has remained within the target inflation band as agreed upon in the 3 - year program, which strengthens credibility and keeps the inflation rate down. as to whether there is a big amount of money, as to whether this amount has been increased too much in recent years, or whether there is still enough room for a monetary base expansion, i would like to show you which are the central bank ’ s current monetary contraction tools or which are the tools available today in the market to absorb and control an oversized monetary base expansion. first, it should be noted that this is a surplus administration with a tightening approach because it saves more than it spends. also, the quasi - monies have been absorbed. the financial sector follows an equally tightening approach. during 2002, a series of rediscounts were granted with a view to

in several euro area countries, excessive imbalances exist and need to be corrected. to this end, comprehensive product, labour and financial sector reforms will help foster sustainable growth. competition should be strengthened in product markets, not least by the completion of the single market, and wages should adjust in a flexible manner, reflecting labour market conditions and productivity. these bis central bankers ’ speeches growth - enhancing reforms would accelerate the necessary adjustment process and enhance job creation. finally, the governing council very much welcomes leaders at the last european council meeting agreeing to step up their reflections on the long - term vision for economic and monetary union. the governing council considers this a highly important step. we are now at your disposal for questions. bis central bankers ’ speeches