. it has clearly the potential to enhance the robustness of our judgments about future economic developments. in the past few years, academic research has emphasised the advantages of robust analytical tools for appropriate policy responses in an environment of prevailing uncertainty – something that has always been known by practitioners of central banking. however, besides this longer - term nature of the relationship between monetary developments and inflation, there is the need to take into account also other and more short - term risks to price stability. this is the core of the economic analysis in the strategy of the eurosystem. given the different time horizons of the economic and monetary analysis i think that the demands that are sometimes brought - up in the public debate to merge the two pillars are not convincing. there is no existing model that would allow to integrate the multitude of economic information that is relevant for monetary policy in one coherent theoretical structure. this is especially relevant for the integration of monetary aggregates into traditional macroeconomic and macroeconometric models. insofar, proposals to merge the two pillars are ill - founded. the ultimate goal of the two - pillar structure is the efficient utilisation of available information for monetary policy decisions and communication. however, one possible approach with regard to the information gained through the lens of the economic and monetary analysis might be found in a stronger formalised combined assessment of the information included in both pillars for future inflation developments. this is in a sense what the cross - checking is all about. of course, the merits of a more formalised forecasting combination would have to be weighted against any possible loss of information that might be associated with it. this brings me to another criticism that is sometimes voiced, namely that monetary developments are not regarded as being informative about the eurosystem ’ s monetary policy decisions. in my view, this criticism is unjustified : firstly, the very nature of the information content of the monetary analysis has to take into account its role as a cross - checking device and its focus on longer - term risks to price stability. secondly, in an environment of heightened financial market uncertainty actual monetary dynamics may to a large part be driven by noise which does not necessitate a monetary policy reaction. the portfolio - shift adjustment of money growth in the post 2001 period can be seen as an example. by the way : the role of money in our policy decisions has been analysed in recent empirical research ; on that issue which found a kind of non - linear relationship between monetary developments and policy reaction.

on - quarter growth rates of 0. 3 % and 0. 2 %, respectively ). in their latest projections, ecb staff are forecasting modest economic growth of 0. 8 % in fullyear 2024, rising slightly to 1. 3 % next year. the outlook is uncertain, particularly given what remains a tense geopolitical environment. neither in ukraine nor in the middle east has the situation eased. the outcome of the presidential election in the united states is another source of economic uncertainty. last week's tv debate gave us a taste of what is to come. europe might end up losing out if, say, the united states adopts a more protectionist trade policy, takes government action to support the country as a business location, or turns its back on multilateral cooperation ( on issues such as climate action, nato and the wto ). 2 / 7 bis - central bankers'speeches there's good news as well, though : the labour market in the euro area is as robust as ever, as unemployment hit an all - time low of 6. 4 % in july. germany's economy hasn't recovered yet, so its labour market hasn't improved, but nor did it deteriorate significantly. because firms in germany have largely refrained from scaling back their workforces during the ongoing spell of economic weakness, they see little need overall for new hires. even if they are certainly finding it difficult to fill vacancies in some areas. an analysis by the ecb has found that labour hoarding – that is, keeping staff in reserve – is still above pre - pandemic levels in the euro area. because profit margins were high at times, firms were able to hoard staff to a greater extent or for longer than usual when the situation or outlook deteriorated, the ecb noted. 2 if profit margins now start to normalise, they will probably reduce the scope for firms to undertake labour hoarding. in addition, labour hoarding suggests that there will be fewer hires than usual as the economy recovers. instead, productivity is more likely to rise. the new projections include an increase in euro area labour productivity of around 1 % in both 2025 and 2026, following stagnation in the current year and a decline of just under 1 % last year. taken in isolation, this would dampen unit labour costs and thus inflation. 3 inflation this brings us to question number two concerning the outlook for prices. on this point, the focus