it judges that the progress realized in underlying inflation is consistent with inflation stabilizing at 2 % over the medium term. commitment to a symmetric inflation target requires particularly strong or long - term monetary policy measures when interest rates are close to the zero effective lower bound. this commitment, which is buttressed by the new forward guidance, is crucial to support the anchoring of long - term inflation expectations to 2 %, but as said it may also imply a transitory period in which inflation is moderately above target. a medium - term orientation for the inflation target is baked in into the new strategy, which also makes it possible, where necessary, to smooth out other economic shocks, such as shocks related to employment or financial stability. if actual inflation is slower or faster than targeted, monetary policy will respond to deviations gradually, considering the nature of the economic disruption. deviations estimated to be temporary may not be responded to at all, but seen through. the symmetric inflation target should help to ensure a stable and predictable price outlook, which is a key prerequisite for sustainable economic growth and a high level of employment. price stability, balanced growth and a high employment rate are mutually consistent goals, and successful monetary policy improves the well - being of citizens by focusing on price stability. to this end, targeted monetary policy communication can improve people ’ s understanding of how monetary policy responds to current and projected economic conditions. * * * the strategy review also examined how monetary and fiscal policy can work together during and after times of crisis. the conventional thinking gives a clear division of labour between the monetary and fiscal authorities : monetary policy should promote price stability, and fiscal policy should keep sovereign debt on a sustainable path. however, in a period of low interest rates, the scope for monetary - fiscal policy interactions is possibly wider. counter - cyclical fiscal measures complement monetary policy when key policy interest rates cannot fall any further. similarly, low interest rates can keep financing conditions favourable during and after crisis, thus creating space for fiscal authorities to respond to an economic downturn and hence stabilize the economy. fiscal policy also matters for the transmission of monetary policy in low interest rate environments. a recent study by bank of finland staff, ” the power of forward guidance and the fiscal theory of the price level ” 1, argues that fiscal support is essential for forward guidance announcements to have the right kind of effect on inflation and output. fiscal support remains important at the effective lower bound and before inflation robustly converges to the 2 % target. moreover

the floor for possible questions. thank you. 1 mcclung, nigel, “ the power of forward guidance and the fiscal theory of the price level, ” international journal of central banking, ( 2021, forthcoming ) see e. g. belu manescu, c and e bova ( 2020 ), “ national expenditure rules in the eu : an analysis of effectiveness and compliance ”, discussion paper 124, european commission. till cordes, kinda, t., p. muthoora, and a. weber ( 2015 ) : “ expenditure rules : effective tools for sound fiscal policy? ”. imf working paper 15 / 29. 4 / 4 bis central bankers'speeches