it should stand ready to ease monetary policy to cushion the impact of structural reform and fiscal discipline. ” see, for example, o. blanchard e f. giavazzi ( 2005 ), “ credibility does not require dogmatism - only clarity of purpose ”, at www. voxru. org. s. cecchetti, h. genberg and s. wadhwani ( 2002 ), “ asset prices in a flexible inflation targeting framework, ” nber working paper no. 8970, june, and n. roubini ( 2006 ), “ why central banks should burst bubbles ”, international finance 9, no 1. harder to interpret financial asset prices and to derive from them indicators regarding the risks of instability. and it is even more difficult to adjust the course of interest rates on the basis of these indicators. for this reason, the proposition of leaning against the wind remains an abstract concept for now. it would be important to develop economic models which give a more precise idea of the quantitative dimension of these phenomena, in particular of the correlation between monetary policy variables and financial asset prices. 6 the ecb has for some time tried to use information relating to money and credit markets when forecasting inflationary pressures. the ecb bases its strategy on two pillars, an economic pillar and a monetary pillar, which collects various short and medium - term indicators, including aggregates and prices of financial assets. these indicators are not used mechanistically, but rather to gauge whether the conduct of monetary policy is broadly consistent with achieving the target. it was on the basis of these indicators, which showed strong dynamics, that the ecb decided to increase interest rates at the end of 2005 – that very controversial decision which subsequently proved to have been correct, as i mentioned earlier. 7 the second aspect on which a debate is developing concerns the objective of monetary policy. in most countries monetary policy has price stability as its primary objective. there are also other, secondary objectives to be pursued insofar as they are consistent with price stability. the question which has been asked as a result of the crisis is whether the central bank also ought to have financial stability as an explicit objective, on the same level as price stability. indeed, if price stability is a necessary condition for the achievement of financial stability, it is not sufficient. on the other hand, without financial stability, there is a risk that price stability will not be durable. it thus seems reasonable to assign central banks the objective of financial stability

, have facilitated the growth of global value chains. this has been associated with both an increased synchronicity of global inflation9 and a dampening effect on domestic inflation. that said, results for the euro area are less conclusive. 10 in addition, digitalisation may affect price - setting behaviour through a variety of mechanisms. digital pricing algorithms may also alter the nature of price - setting, at least in some sectors of the economy. for instance, by taking into account shifts in demand and supply more readily, such algorithms may accelerate the responsiveness of prices to shocks. 11 the expansion in online sales also facilitates price comparisons and alters market structures. of course, the impact is much broader than just actual online sales, since online prices also affect brick - and - mortar prices. 12 at the same, digitalisation may foster the rise of “ superstar ” firms that acquire a dominant market position on the back of the constellation of high fixed costs and low variable costs associated with many digital ventures. the market power of such firms may have long - term implications for price dynamics. current estimates point, however, to the rise of e - commerce having relatively modest effects on inflation. a recent ecb study found that e - commerce has reduced non - energy industrial goods inflation by 0. 1 percentage points annually since 2003. studies by other central banks have found similarly small effects. 13 this does not preclude the possibility that we will see larger effects in the future, as online commerce grows further in size and scope. i am sure that these topics will feature in your discussions over the next two days : i look forward to learning from your contributions. 1 i would like to thank filippos petroulakis for his contribution to this speech. 2 human capital, knowledge in databases, organisational capital and brands are examples of assets not covered in the national accounts. see also andersson, malin and saiz, lorena ( 2018 ), “ investment in intangible assets in the euro area ”, economic bulletin, issue 7, ecb, november ; and speech by luis de guindos ( 2018 ), “ investment, technological transformation and skills ”. 3 see crouzet, nicholas and eberly, janice ( 2018 ), “ understanding weak capital investment : the role of market concentration and intangibles ”, jackson hole economic policy symposium. 4 see avdjiev, stefan, everett, mary, lane, philip r. and shin, hyun song ( 2018