##a, the single euro payments area. the goal of the sepa project is to make electronic payments as easy, convenient and straightforward for the residents of any euro area member country to carry out as are their cash payments in other countries in the union. the initial aim is to eliminate the differences between making a national payment and a cross - border one, although the benefits extend also to payments made in the national arena. what is involved is a further step in the ongoing integration of financial services in europe. to achieve this, we must adapt to a new set of rules and uniform standards in europe. but we have very little time remaining : community legislation envisages sepa being in place as from 1 february next year. it is a far - reaching project, necessitating changes in the relationship between paymentservices users and providers. that involves efforts and investment on the part of financial institutions, but also affects users, irrespective of their size. it is important that banks should strive to make the transition by their customers easier. in this connection, communications and advice to customers must be stepped up, informing them of the new circumstances ahead and offering them the necessary support in their migration to the new payments scenario. our eurosystem central banks are firmly committed to sepa, among other reasons because we believe it will contribute to shoring up confidence in the single currency, by helping lift obstacles and promoting competition. and now i hope you all enjoy your meal. i believe there will be a round of questions – easy ones i trust – after dessert. thank you. bis central bankers ’ speeches

, including of course the covid pandemic, but it should not hide more profound difficulties. it is difficult for weaker governments to resist the " conflicting demands " to increase spending and cut taxes : higher deficits are often too easy an answer to these opposing objectives. this complicates the task of central banks in combating inflation in too many countries today – including perhaps the most important one –, monetary tightening is not sufficiently backed by fiscal tightening. iv in our monetary policy statement, we regularly reiterate that such a mismatch could “ call for even tighter monetary policy ". let me mention another possible dimension of domestic “ conflicts ”. inflation has an inherent conflictual component, as recalled in a recent paper by guido lorenzoni and ivan werning, v echoing previous work by olivier blanchard. vi conflicts between incompatible markup and wage aspirations can take place between firms and employees, and potentially lead to an inflationary spiral. inflation is potentially a distribution conflict : we know it since the 1970 ’ s. and we have recently seen episodes of greedflation in certain countries or sectors, or excessive wage demands. that said, from a macroeconomic perspective, the past recent surge in inflation has not been significantly fuelled by a wage - price spiral, nor a profit - price spiral. several factors have limited the scope for such page 8 sur 14 spirals. first, the prevalence of automatic wage indexation has declined and wage negotiations are more decentralised. second, government policies have directly or indirectly limited the impact on households and firms of the surge in energy costs – although at the expense of heavier public debt. last but not least, central banks credibility combined with their swift reactions has helped to anchor and coordinate the inflation expectations of employers and employees. this latter consideration naturally leads me to the second part of my speech, so i will now turn to how we central banks should travel through this new and troubled landscape. 2. central banks are more humble but not disarmed the current environment is admittedly highly challenging and leaves central banks more humble, but not disarmed. since “ conflict ” is the red thread of my talk, allow me to borrow from clausewitz ’ s “ fog of war ” concept : “ war is the realm of uncertainty ; three quarters of the factors on which action in war is based are wrapped in a fog of greater or lesser uncertainty. a sensitive and discriminating judgment is called for ; a skilled intelligence to scent out the truth.