not on the latest observed inflation. this requires projecting inflation via different approaches. recent ecb staff forecasts see inflation averaging 2. 3 % in 2024. given this, earlier this month we decided to front - load the normalisation path of our key interest rates, and to announce further rate hikes down the road, in order to ensure the return of medium - term inflation to our 2 % target. third, it is very difficult to know how much further our key rates will need to rise eventually in this hiking cycle, given the huge uncertainty that we face in the current context. but for this very reason, economic models are helpful in providing us central bankers with some guidance. i have provided in this speech some estimates based on models developed by banco de espana staff. crucially, this is a data - dependent forecast which may change as time goes by and new information comes in. also, it will depend on our future decisions regarding our asset purchase programmes. i hope that my words have reassured you about our determination to rein in inflation without causing unnecessary suffering to our fellow euro area citizens. we live in difficult times, but we expect to rise to the challenge. thank you for your attention.

term orientation requires projecting the future path of inflation. surveys and financial market instruments provide us with a useful tool in this respect, as they give us evidence of how different agents ( experts, households, firms, and financial market participants ) see inflation evolving going forward. in addition, central banks rely on their staff ’ s forecasts for inflation and economic activity – which typically draw on a huge amount of economic and monetary analyses – as a key input in their decision - making process. summing up, our task is not to respond to the latest inflation data point, a futile and – especially in the face of adverse supply shocks – counterproductive task, but to stabilise inflation over the medium run at the desired level, in our case 2 %, while ensuring that longerrun inflation expectations remain anchored to the target. returning inflation to 2 % over the medium run in the context of a steady increase in medium - term inflation expectations, as economies recovered from the worst phase of the pandemic crisis, at the end of 2021 we started at the ecb governing council a process of progressive normalisation of our monetary policy. the first step was to withdraw the extraordinary policy stimulus that we had launched at the onset of the pandemic. to this end, in march we stopped the net asset purchases under the pepp. in our june meeting we concluded that the conditions in our forward guidance for raising interest rates had been fulfiled ; we therefore communicated our intention to raise rates in july and again in september, and – consistently with our chained forward guidance see, for instance, carvalho, c., s. eusepi, e. moench and b. preston, “ anchored inflation expectations ”, american economic journal : macroeconomics ( forthcoming ). see gati, l., “ monetary policy and anchored expectations : an endogenous gain learning model ” ecb working paper no. 2022 / 2685, 2022. between rate hikes and asset purchases - we announced that net purchases under the app would end at the start of july. in that month we raised our rates by 50 basis points, a larger increase than we had signalled in june, based on our updated assessment of inflation risks and the reinforced support provided by the new transmission protection instrument ( tpi ) for the effective transmission of monetary policy across the euro area. earlier this month we hiked rates by an unprecedented 75 basis points, motivated by inflation levels that were far too high and likely to