might be larger is the effect of so - called “ global slack ”. this is the notion that globalisation has made labour supply characteristics more uniform across the globe and labour markets more contestable. conditions in foreign labour markets could therefore have a dampening effect on domestic inflation even as domestic slack is shrinking. the evidence, however, is not clear - cut. for example, new ecb analysis finds only limited 3 / 7 bis central bankers'speeches support for the thesis that global slack is weighing on euro area inflation today, over and above the impact it has on global prices. 6 alongside the question of the level of slack is the impact of slack on inflation. this is the wellknown debate on the slope of the phillips curve. there are indeed reasons to believe that wage and price setting behaviour in the euro area might have changed during the crisis in ways that slow the responsiveness of inflation. for example, structural reforms that have increased firm - level wage bargaining may have made wages more flexible downwards but not necessarily upwards. likewise, we see today that firms are absorbing input costs through lower margins due to uncertainty over future demand, which would also tend to temper price pressures. indeed, ecb estimates show that, if we take into account the unusually large and persistent shocks of the past years, the phillips curve for core inflation may well be somewhat flatter recently. however, insofar as the slope of the phillips curve depends nonlinearly on the cyclical position, it may steepen again when the economy reaches and surpasses full potential. while these various reasons might delay the transmission of our monetary policy to prices, they will not prevent it. as the business cycle matures, the higher demand resulting from positive supply developments will accelerate price pressures, while firms ’ pricing power will increase and the broader measures of slack will converge towards the headline measures. as shown in the united states, the gap between the headline unemployment rate and those broader measures typically opens in recessions and shrinks in expansions. currently, it is converging to the minimum levels recorded before the 2001 and 2007 recessions. so just as for oil and commodity price shocks, we can be reasonably confident that the forces we see weighing on inflation are temporary – so long as they do not feed more lastingly into inflation dynamics. low inflation feeding into price and wage setting this brings us to the third possible explanation for why growth might be diverging from inflation : the hypothesis that a persistent period of low inflation is in fact

sabine lautenschlager : cyber resilience - a banking supervisor's view statement by ms sabine lautenschlager, member of the executive board of the european central bank and vice - chair of the supervisory board of the single supervisory mechanism, at the high - level meeting on cyber resilience, frankfurt am main, 19 june 2017. * * * this week i learnt that the first computer virus dates back to 1971. it spread via the arpanet, which was a precursor of today ’ s internet. the arpanet connected about two dozen universities and government hosts in the united states. the virus had been written for experimental purposes and was not malicious. it just displayed a simple message on infected computers : “ i ’ m the creeper : catch me if you can ”. things are a bit more complex today, and the outcome of cyber incidents much worse : they can disrupt business, cost a lot of money and destroy reputations. and indeed, the potential for damage is great, as so much relies on it and so much happens online – the financial sector is a case in point. as you all know, banks have always been attractive targets for criminals. although the damage has been limited so far, we banking supervisors take cyber risk very seriously. and we insist on banks doing the same. cyber risk has been a priority for ecb banking supervision from day one. in 2015, we established a working group that had three goals. first, to get an overview of how supervisors deal with such risks both at national and international level. second, to get an overview of how prepared banks are for cyber risk. and third, to propose to the supervisory board a strategic direction and a dedicated work plan on cyber risk. we have learnt a lot over the past two years. and we have used it to address this risk from several different angles. for us, one of the first steps was to establish a cyber incident reporting framework. we conducted a successful pilot phase in 2016. and now we will implement a long - term solution for all those banks that we directly supervise. as from this summer, they will be required to report all significant cyber incidents. this will help us to assess more objectively how many incidents there are and how cyber threats evolve. it will also help us to identify vulnerabilities and common pitfalls. in addition to our ongoing supervision we also perform thematic reviews on cyber security and it outsourcing. these reviews help us to assess the risks