: the 2 / 4 bis central bankers'speeches tiering system and tltros. the tiering system was introduced after the deposit facility rate was pushed in negative territory, to offset the negative side effects of low - for - long interest rates for banks intermediation. in the case of the tltros, we have excluded housing loans from the lending benchmark to avoid contributing to a potential housing bubble. so far, i have mentioned adjustments to our individual instruments ; but more generally, our monetary policy tools could be combined with each other so that they maximise their impact on inflation while minimising the side effects on financial stability. 4 indeed this is precisely what the old tinbergen rule asserts : we now have several instruments in our monetary policy toolkit, allowing us to reach several goals. iii. economic stability let me now turn to economic stability. the stabilisation of the business cycle is the area of policy trade - offs and dilemmas par excellence. as long as price dynamics are in line with the business cycle, monetary policy is counter - cyclical. fortunately, this is the case most of the time, as demand shocks tend to prevail. that said, monetary policy is not the only stabilisation policy : fiscal policy is also very active, which raises the very topical issue of the congruence between monetary and fiscal policies. as long as inflation prospects remain too low with respect to the central bank ’ s inflation objective, accommodative monetary and fiscal policies can be congruent without any formal coordination. this is obviously the description of the policy - mix at the current juncture. moreover, in a context of low r *, fiscal policy is more effective and gains policy space thanks to the accommodation provided by the central bank ( as r < g ). in turn, the effects of monetary policy, which is constrained by the effective lower bound ( elb ), are reinforced by fiscal policy, which becomes today one of its main “ transmission channels ”. but in the longer run – and in the years to come –, the greatest risk is of course that monetary policy could become subordinated to fiscal policy. if and when inflation reappears, central banks must be able to normalise their stance and increase the interest rates paid on debt. acting too late or too little, for short - term or political reasons, can be very costly for long - term interest rates and inflation. the best way to foster the current policy - mix

risks as well. within europe, italian fiscal policy is under investor scrutiny. and there is brexit, although its direct effect on the euro area macroeconomy is likely to be small. how should we, as euro area central bankers, respond to this economic environment? by combining two apparently contradictory aims : clarity and flexibility. as regards clarity, our first duty as policymakers is to provide markers to help guide economic actors and financial markets in the increasing fog of uncertainties. for our guidance to be reliable, we need to be as clear, credible and consistent as possible. we cannot be clear like a train timetable but more like how a captain sets a course and adapts to the wind and the waves. so our sequence of steps for policy normalisation is very predictable : first, we halved our net asset purchases to 15 billion this month and will very probably end them in december ; 1 / 4 bis central bankers'speeches second, we set down a guide post with our long - dated forward guidance : we will maintain interest rates at current levels until at least through the summer of 2019 ; and third, we will retain our stock of assets for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation. let me insist on this : the end of the net asset purchases will not be the end of our monetary stimulus, far from it. moreover, this sequence doesn ’ t depend on the fiscal uncertainties that can appear in member states. the governing council is clear about the fact that there is no fiscal dominance in the euro area and no influence of any national fiscal policy on our common monetary policy. in addition, our past consistency forges our credibility for the future. since march 2016, we took decisions on the evolution of our net asset purchases at intervals of approximately 9 months. each time, we gave visibility over the next twelve months ; and we stuck to the provisional indicative timetable that we set without extending the time limits. i turn now to flexibility. our sequence is clear but the details of implementation are flexible and state - dependent. we have included several options, such as the precise timing of the first increase in interest rates and the path of policy rates thereafter, or the pace of our reinvestments. there is much speculation for instance on the future trajectory of our interest rates ; but at this stage, i don ’ t see any value in trading off our flexibility tomorrow against more clarity today. beyond that, as mario draghi mentioned today,