. so, looking at my fellow central bankers here tonight, i must ask : what will we do? shall we sit quietly? i don ’ t think so. no, the job for the central bankers among us is clear. like on the painting, we will rise up, fiercely spread our wings, and protect our eggs from the menacing mongrel of inflation. hence the ecb ’ s recent move – to raise interest rates by 75 basis points. as my central bank colleagues gathered here tonight will confirm, this major transition in monetary policy was a necessity. at current inflation levels – levels that are threatening our european prosperity – we need to rapidly transition away from a highly accommodative monetary policy to interest rate levels that will support a timely return to our inflation target of two percent over the medium term. and i anticipate further rate hikes over the coming months, to be specified meeting by meeting, based on data, and guided by our objective of price stability. but we know that, even with our recent, major changes to monetary policy, it will take time for these changes to take effect in the economy and actually bring inflation down. that is why i am grateful to be here. however much i like preaching to the monetary choir in this room, being here gives me the opportunity to address the full efc, including member states ’ finance ministries, the european commission and related agencies. hence, an opportunity to re - emphasise the value of working together. in the aftermath of the global financial crisis, after 2008, monetary and fiscal policy were each fighting their own battles. partly due to this, and with the benefit of hindsight, economic recovery was slowed down. more recently, a mere two and a half years ago, the dog in the water was the corona virus. in the meantime, however, we had learned valuable lessons from the past. so when the pandemic hit us it was a swift and balanced cooperation between monetary and fiscal pandemic hit us, it was a swift and balanced cooperation between monetary and fiscal policy that gave our economy wings to fight back. and that is what we need to do now as well : to jointly work towards our common goal – a secure and prosperous europe. needless to say, each within our own mandate. but i would also like to express a word of caution though : fiscal measures that are aimed at compensating households for high inflation might themselves become inflationary when they further increase the imbalance between

supply and demand. and higher inflation would in turn require, again, a firmer policy response from central banks. but from a democratic, and perhaps more importantly, moral stance, the valid question remains : what can governments do to alleviate some of the worst economic pain without increasing price pressures further? first of all, we probably all agree that the most vulnerable households need to be helped with well - targeted financial support. for a lot of other households, compensation should come from targeted wage growth. while it is paramount to avoid a wage - price spiral, it is also important that wages rise in sectors of the economy that have the scope to do so. second, governments should address supply - side restrictions more directly where they can. on the energy market, this means achieving a more balanced mix of energy sources as soon as possible. on the labour market, this means removing the impediments that constrain labour supply growth – there is still room for improvement in labour participation in several european countries. third, the economic reform agenda and the public investments that can boost potential growth must continue. and preferably, this will be done without further deficit spending, because public debt levels are already uncomfortably high. if you look again at “ the threatened swan ”, you will see a very natural phenomenon : a swan defending her eggs. but the swan is also fierce and grand. filled with passion. filled with conviction. if it could, the swan would march right into this gallery. for many of us here tonight, the dog in the water is inflation. for others, it is the energy crisis. the refugee crisis. the climate crisis. the pandemic. an atrocious war on european soil. each and every one of us, here or elsewhere, each in their own capacity, should step forward, spread their wings wide, and defend, fierce and grand, with passion, with conviction, the eggs of our times. i thank you and wish you a very pleasant evening.