will do what is necessary to guarantee price stability. this contributes to anchoring inflation expectations at levels consistent with price stability. 2. 2. 4 communication and the introductory statement the introductory statement of the eurosystem published shortly after the policy decision is announced provides the policy relevant information in a structured manner to the public in real time. it is the governing council ’ s main instrument of context - specific communication. the wording of the statement is agreed upon in the foregoing meeting, and thus it presents the consensual assessment of the governing council. it portrays the council ’ s deliberations through the lenses of the two pillar strategy. and it puts into perspective the linkages between data, decisions and stated medium - term policy objectives. the time lags in the transmission of monetary policy and the medium - term orientation of the eurosystem require describing how present and future information that comes in is processed. in this respect, we offer guidance about what academics would call the reaction function of the governing council. the introductory statement specifies the way we react to economic and monetary developments, analyse and judge shocks hitting the euro area, and view the outlook for economic growth and inflation as well as the associated risks over different time horizons. in doing so we constantly emphasise the forward - looking nature of our policy framework and the medium - term orientation with regard to our price stability objective. the first part of the statement entails our combined broad assessment of the information from both pillars. in the subsequent parts economic and monetary analysis is presented in greater detail and cross - checked with one another. i will only make some remarks on the latter sections. our assessment keeps economic and monetary analysis distinct because from an empirical perspective the information content of both pillars relates to different time horizons regarding the risks to price stability. having both, monetary and economic analysis instead of just cyclical information, one avoids the mistake of taking a too narrow view of the data. our broad - based and robust strategy thus prevents us from ignoring potentially relevant information. let me put these general remarks into a more specific context by referring to the statement we published today. as the president of the ecb announced today we decided to increase the key ecb interest rate by 25bp to 4 %. this decision was based on our assessment of the risks to price stability which we have identified from our economic and monetary analysis. our economic analysis suggests the following : regarding growth, incoming information clearly confirms that the euro area economy continues to expand at a pace significantly

bank in troubles. it also includes formulating credible resolution plans for credit institutions. this is all about getting the incentives right. no credit institution should be “ too big to fail ”. these are well - known areas of progress since the crisis, but we still have some way to go before the new and harmonised regulatory framework is fully in place. there are indeed still bumps on the road. at the current juncture, where the memory of the last financial crisis seems to be fading, page 8 of 9 it is important that we stay committed to the implementation of the new regulation. this will reduce the likelihood of a new financial crisis with all its detrimental effects on our economy. if we – through ongoing reforms and implementation of the new rules being adopted in basel and brussels – end up delivering on all three pillars of regulation, then i think we have learned our lesson from the crisis well. and once all these measures are in place, we will be ready to take the next step : removing unnecessary red tape by simplifying the remaining part of the regulation and easing some of the administrative burden on banks. the three - pillar system would leave it to market forces to keep the financial sector in check. as long as banks perform on all three parameters, the credibility and soundness of their balance sheets and business models will ensure their access to necessary capital and funding. and with the resolution regime in place, we no longer need governments to save banks with taxpayers ’ money. conclusion to conclude, this period of low interest rates and unconventional monetary policy has been fundamental for the economic recovery. while global economic developments are indeed strengthening, we should be prepared for lower growth rates going forward. structural reforms to lift potential growth and rebuilding of fiscal buffers are important. low interest rates have also left a legacy, affecting banks'earnings, central bank balance sheets, as well as asset - price valuations. as normalisation of monetary policy proceeds, we must be ready to carefully manage risks and spillovers. implementation of regulatory reforms and an effective macroprudential framework will be essential to contain financial stability risks. thank you very much for your attention. page 9 of 9 danmarks nationalbank national asset - liability management europe conference 1 march, 2018 global economy is strengthening positive output gaps in the us and euro area upward revisions to economic forecasts per cent of potential gdp real gdp growth, per cent year - on - year projection output gap closed us - 1 - 2 - 5 world imf projections jan 2018 us euro area