recovery takes hold, the quality of jobs will improve and allow wages to rise, but this will take time. are the reforms undertaken by the euro area countries going in the right direction? it ’ s not the ecb ’ s job to give lectures. our mandate is to protect the purchasing power of the people of europe. growth has returned in all the euro area countries and consumer confidence across europe is at its highest for 16 years. the priority now is to achieve greater convergence between the countries and thus create a more resilient economic bloc. every country must continue with its reforms : in particular france, but also germany. does the economic transformation of france promised by emmanuel macron go far enough? it will enable france to make up for lost time. the return of growth in europe is offering france a 1 / 2 bis central bankers'speeches unique opportunity to pursue a coherent set of reforms in order to rectify its weaknesses : persistent unemployment, inadequate training, deficits in public finance and external trade. but this is happening at a time when globalisation and technological change are creating uncertainty. more flexibility is needed, it ’ s true, but we shouldn ’ t forget those who get left behind by this model. and the level of france ’ s public debt? on the budgetary front, france still faces a predicament. its deficit is falling, but mainly because the economy is growing again. if the economic climate changes, where will the room for manoeuvre be? it ’ s now high time that france, the second - largest economy in the euro area, let go of the ecb ’ s monetary policy. what institutional reforms will be needed to consolidate the euro area? that ’ s a matter for the heads of state and government. for a long time i have favoured the establishment of a euro area finance ministry. provided it was given the right financial tools, this would facilitate the handling of the next crisis without having to rely excessively on the ecb, which was mainly the case these past few years. but for the ministry to come into being, a degree of trust has to be recreated between the countries. in this discussion, the reforms and the serious nature of france ’ s budget are a test case. let ’ s also prevent the common budget from absolving governments of their budgetary responsibilities. would a european monetary fund make sense? i am not one of those who think that europe should get rid of the international monetary fund ( imf ). the

mr duisenberg explains the thinking of the european central bank on the issue of whether markets need guidance introductory statement delivered by dr willem f duisenberg, president of the european central bank, at the frankfurt european banking congress session i : “ do markets need guidance? ” held in frankfurt on 19 november 1999. * * * thank you very much for giving me the opportunity to explain the thinking of the european central bank ( ecb ) on this important issue. let me start by summarising my answer to your question : yes, the markets need guidance from the ecb. this guidance should mainly focus on reducing uncertainty in the markets. this requires above all a clear and credible commitment on the part of the ecb and sound economic analysis. thus, guidance should be given through a credible monetary policy strategy and a transparent ongoing assessment of euro area developments in line with this strategy. reducing uncertainty also implies that in our communication we do not pretend that we know more than we really do. obviously, our knowledge of the future course of the euro area economy will always be subject to uncertainties and limitations. it thus goes without saying that guidance certainly cannot be given in such a way that the ecb indicates a path for future ecb interest rates far in advance. this leads me directly to the second part of your question. ( “ is any particular mode of guidance preferable? ” ) how should the ecb give guidance to the markets? at the heart of the answer to this question is the eurosystem ’ s monetary policy strategy. indeed, this strategy is designed to make both our objective and the monetary policy aimed at achieving this objective credible, transparent and comprehensible, and thus make our decisions predictable. however, let me be very clear. being predictable in no way implies that the central bank intends to follow the market. on the contrary, the causality should run in the other direction. markets should be in a position to anticipate monetary policy decisions based on a credible strategy of the central bank. this does not exclude that certain monetary policy decisions may sometimes surprise the markets, but this is not our aim. as was argued in an article in the most recent issue of the ecb monthly bulletin, a stability - oriented monetary policy contributes to reducing certain risk premia in interest rates and thereby to increasing the efficiency of the allocation of capital, thus enhancing overall welfare. this shows that it is very important to give clear guidance to the markets by conducting a credible monetary policy focused on