##ystem ’ s monetary policy. other members of the executive board may also report to the committee, and have already done so on specific topics. in view of the ecb ’ s general willingness to cooperate with the european parliament on this issue, there is no justification for any more far - reaching demands. monetary policy, the value of money, has deliberately been removed from national and supranational parliamentary control in order to keep money and the currency out of the purview of day - to - day politics and the clutches of pressure groups. this is a modification of the democracy principle for the sake of safeguarding the currency. in the current debate in the european parliament, that fact should be recalled whenever there is talk of “ democratic accountability ”. in order to rule out politicians ’ intervention from the outset, the responsibility for the monetary system was assigned to the central bank. that constituted an attempt to “ de - politicise ” monetary policy, to put it in the hands of experts who, thanks to their long terms of office, are independent of day - to - day political concerns and have to gear their policies to an objective. these principles must be borne in mind whenever attempts are made to involve the ecb more closely in macroeconomic coordination in the euro area. in order to preclude misunderstandings, the following should be pointed out : stability - oriented monetary policy must be buttressed by responsible economic, fiscal and pay policies to ensure the lasting success of emu. since those policy areas have remained national responsibilities, coordination is in the best interests of all those concerned, as i said at the beginning. in line with article 99 of the ec treaty, member states therefore regard their economic policies as a matter of common concern. the functioning of emu must not be jeopardised by the economic policies of individual member states. coordination is accomplished in an annual cycle, at the centre of which are the “ broad economic policy guidelines ” ; they are adopted by the ecofin council on the recommendation of the commission and after discussion by the european council. the broad guidelines define the main economic policy objectives and the basic policy orientations. eu member states are required under the ec treaty to gear their economic policies to those guidelines. pursuant to the ec treaty, the ecofin council is the key coordinating body. it makes comments or recommendations to the member states, and may, if necessary, also publish them – as it did recently in the case of ireland. the enhanced coordination of economic

interest rates so low? 2 in a speech last month, i identified a number of factors that have worked to boost saving, depress investment, or both. among the factors holding down interest rates is the sluggishness of foreign economic growth. another is demographics, with saving being higher as a result of an increase in the average age of the u. s. population. also, investment recently has been weaker than might otherwise be expected, perhaps reflecting uncertainty about longer - run growth prospects, as well as the decline in investment in the energy sector as a result of the fall in the price of oil. finally, and most important, weak productivity growth has likely pushed down interest rates both by lowering investment, as firms lower their expectations for the marginal return on investment, and by increasing saving, as consumers lower their expectations for income growth and borrow less and / or save more as a consequence. understanding the recent weakness of productivity growth is central to addressing the longer - run challenges confronting the economy. productivity growth over the past decade has been lackluster by post - world war ii standards. output per hour increased only 1 - 1 / 4 percent per year, on average, from 2006 to 2015, compared with its long - run average of 2 - 1 / 2 percent from 1949 to 2005. this halving of productivity growth, if it were to persist, would have wide - ranging consequences for living standards, wage growth, and economic policy more broadly. a number 1 / 2 bis central bankers'speeches of explanations have been offered for the decline in productivity growth, including mismeasurement in the official statistics, depressed capital investment, and a falloff in business dynamism, with reality likely reflecting some combination of all of these factors and more. we should also consider the possibility that weak demand has played a role in holding back productivity growth, although standard economic textbooks generally trace a path from productivity growth to demand rather than vice versa. chair yellen recently spoke on the influence of demand on aggregate supply. 3 in her speech, she reviewed a body of literature that suggests that demand conditions can have persistent effects on supply. 4 in most of the literature, these effects are thought to occur through hysteresis in labor markets. but there are likely also some channels through which low aggregate demand could affect productivity, perhaps by lowering research - and - development spending or decreasing the pace of firm formation and innovation. i believe that the relationship between productivity growth and the strength of aggregate demand is an area