respond to any undesirable developments. 7. he forecasting performance of the ecb although the accuracy of the ecb's economic forecasts diminished in the past few years, forecasting performance worsened to a comparable degree in other central banks and by private sector forecasters. the decline in forecasting performance reflected a series of shocks, including the pandemic, along with the economic and policy consequences of those shocks ( e. g. the enormous fiscal expansion in the u. s. beginning in 2020 ), the sharp rises in oil, gas, and other commodity prices which were exacerbated following russia's invasion of ukraine, and the sustained disruption of global supply chains during and after the pandemic. the deficiencies experienced in the forecasting performance of the ecb were characteristic of the central banking community in general and have also been emphasised in ben bernanke's report on forecasting at the bank of england. no forecaster could have foreseen the outbreak of covid - 19 or the war in ukraine. we appear to have entered a new period of higher uncertainty, with shocks originating from both the demand and supply sides. our models need to be reviewed and further upgraded to account for this uncertainty. this has also been the finding of the bernanke report. we constantly assess the status of our forecasting and modelling infrastructure, and strive to improve on it in close co - operation within the eurosystem. we will never be able to accurately forecast the outbreak of epidemics and wars, but we should ensure that our models are able to detect those shocks soon after they occur, and to predict their effects as accurately as possible. our projections are very useful and comprehensive tool that analyses the data that we receive and helps to make decisions. having said that, it is also important to point out that no central bank is entirely model - dependent. in our projections, the staff always incorporates a good amount of judgement, so that forecasts better guide our assessments of the most recent economic and geopolitical developments. in concluding my speech, i would like to highlight the following factors which, in my view, explain the success of the ecb's monetary policy, so far, in bringing inflation back very close to the 2 % target, despite a series of shocks, mainly on the supply side, but also on the demand side, which started with the pandemic and continued with russia's unjustified and violent invasion of ukraine.

tobin said that we know little about predicting inflation. that remains true today. in a world prone to supply disruptions and susceptible to political uncertainties, monetary policy can only try to buffer the effects of external shocks on the real economy and on inflation. the past two years have seen an escalation of violence, with russia's unjustified war against ukraine and the unfolding of the middle east crisis last autumn. 2024 is a year of increased electoral activity. there are five months to go to us elections, the outcome of which could alter the course of the global economy. nationalist parties made major gains across the euro area in the european parliament elections, challenging leaders in germany but also france, where snap elections have been called. monetary policy has navigated in the turbulent waters of heightened uncertainty in the past several years. it will continue to navigate in those turbulent waters in the period ahead. 4. climate change challenges at the ecb we have a very clear mandate, which is enshrined in the treaty and has a focus on price stability. we also have an important role to play in addressing the challenge of climate change, always within the limits of our mandate. physical and transition risks can threaten price stability, but also become a source of instability and vulnerability for the financial system, thereby also affecting the transmission of monetary policy. at the same time, in addition to the risks created by climate change, adapting to climate change can bring opportunities, as required investment will bring new, 4 / 7 bis - central bankers'speeches more efficient and more sustainable forms of development, towards a more resilient and green economy. the financing of these investments is also an opportunity for the financial system and the more efficient use of the savings of european citizens. at the ecb we have different sets of actions, from risk management to better macroeconomic modelling and to including climate change risks and mitigation measures in many aspects of our work. 5. policy challenges related to recent political developments monetary policy has a single anchor in price stability, and that anchor is immune to political influence. as an independent institution, the ecb will continue to conduct its monetary policy to attain its price stability objective. the ecb has earned its credibility by focusing on this objective, and not being diverted by political pressures. it will continue to be led by its mandate in the future. the economic agenda of some of political parties is disconcerting, because it includes such policies as increased protectionism and highly expansionary fiscal