which looks at google searches for " inflation " has found that different countries have different thresholds below which the population is inattentive to inflation. 6 in most countries of the euro area, this threshold is somewhere between 2 % and 3 %. in other words, if the inflation rate is above this threshold, attention to inflation is increasing, and so are concerns about inflation. if people are aware of higher inflation and adjust their expectations accordingly, this can increase inflation itself. a further increase and entrenchment of the high inflation rate may follow. 6 / 7 bis - central bankers'speeches of course, the accuracy of such estimates should not be overestimated. nevertheless, the ecb's 2 % target provides a safety margin to ensure that the threshold for increased attention is undershot. which is just one of several good reasons why we should return to our target as soon as possible. thank you very much. 1 lane, p. r. ( 2023 ), underlying inflation, lecture at trinity college, dublin, 6 march. 2 lagarde, c., ecb press conference, 16 march 2023. 3 nagel, j. ( 2022 ), the long shadow of high inflation, speech at the 32nd frankfurt european banking congress, 18 november. 4 d'acunto, f., u. malmendier and m. weber ( 2022 ), what do the data tell us about inflation expectations?, nber working papers, no. 29825. 5 powell, j. h. ( 2022 ), monetary policy and price stability, speech at the economic policy symposium sponsored by the federal reserve bank of kansas city, jackson hole, wyoming, 26 august. 6 korenok, o., d. munro and j. chen ( 2022 ). inflation and attention thresholds. glo discussion paper, no. 1175. 7 / 7 bis - central bankers'speeches

borrow additional amounts overnight at the interest rate on the marginal lending facility, the mlf ( marginal lending facility ) rate. and euro area banks with an excess of reserves were able to deposit them with the eurosystem at the interest rate on the deposit facility, the dfr ( deposit facility rate ). however, euro area banks also had the possibility to lend at higher rates than the dfr ( deposit facility rate ) or to borrow at lower rates than the mlf ( marginal lending facility ) rate in the interbank market. banks thus faced an oppor ‐ tunity cost when accessing central bank facilities. this way, the eurosystem aimed at keeping short - term interest rates in line with the mro ( main refinancing operation ) rate. to support this goal, the eurosystem estimated the aggregate liquidity needs of the banking sector. the main sources of liquidity needs are euro area banks ’ reserve require ‐ ments and autonomous factors which are outside the control of the ecb ( european central bank ) ’ s monetary policy operations. somewhat simplified, the autonomous factors comprise banknotes in circulation as well as deposits of euro area governments with the eurosystem. this brings back wonderful memories, as one of my first jobs at the bundesbank was to precisely estimate those reserve requirements and autonomous factors for germany. the eurosystem would then provide reserves totalling the estimates of the liquidity needs as part of the weekly main refinancing operations. euro area banks would place their bids and the eurosystem supplied the reserves competitively through auctions. to sum up, we operated in a corridor system with scarce reserves and variable rate tenders. the us ( united states ) federal reserve system, too, operated with scarce reserves, though they provided liquidity via asset purchases instead of lending opera ‐ tions. things started to change with the global financial crisis. [ 9 ] up until the crisis, euro area banks with a surplus of reserves would usually lend them in the interbank market to banks with a deficit of reserves. [ 10 ] this lending took place to a significant extent by means of unsecured over - the - counter transactions. as reserves were sufficient only on an aggregate basis, the redistribution of reserves was a prerequisite for the scarce reserve regime to function smoothly. this business depended largely on counterparty risks being contained and predictable. with the onset of the global financial crisis, reserves began to be redistributed less and less