benoit cœure : investing in europe – towards a new convergence process speech by mr benoit cœure, member of the executive board of the european central bank, at the panel “ the big rethink for a stronger europe ”, the economist roundtable with the government of greece, athens, 9 july 2014. * * * i would like to thank lucas guttenberg, jean - francois jamet and marion salines for their contributions. i remain solely responsible for the opinions contained herein. summary economic and monetary union ( emu ) is a political triathlon. it requires resilience and resolve to perform well at all times in the three disciplines of a currency union : fiscal policy, economic policy and financial policy. emu is a team effort. only if every participant performs well can the euro area team be strong. this is the most important lesson from the crisis. the european economy is undergoing a moderate recovery, but complacency would be unwarranted. to really overcome the crisis, there are some remaining major challenges still to be faced. the euro area is not in a financial crisis anymore, but it must still contend with high debt, low growth and unacceptably high unemployment. these are reason enough to remain alert and continue acting. in recent years, economic policy - making rightfully focused on re - establishing the most important necessary condition for growth : stability. for companies to invest, for firms to hire, for households to consume, a stable economic environment is tantamount. there are three relevant dimensions of economic stability : price stability, financial stability and macroeconomic stability, including the health of public finances. in all these areas, we have made substantial progress in recent years. during the crisis, the ecb took all appropriate measures to ensure that price stability provided an anchor in an uncertain and volatile economic environment. as for financial stability, the establishment of the european stability mechanism and the launch of banking union, with its single supervisory mechanism and single resolution mechanism, have been milestones in this respect. as a third dimension, the crisis has shown us the kind of existential threat to monetary union that can be brought about by the build - up of excessive imbalances, i. e. by the lack of fiscal and macroeconomic stability. new growth will not be generated by new debt. sound fiscal policies are essential for growing out of debt. therefore, the existing rules should be applied in a credible manner. that said, we cannot claim “ mission

“ a time to act. the outlook for monetary policy in the euro area. ” speech by klaas knot at the danske bank copenhagen, 30 august 2022 there is no time for tinkering. we must forcefully tackle the still growing problem of persistently high inflation, within the core of our mandate. let me recap the reasons behind this urgency. euro area headline inflation reached 8. 9 % yoy in july, the highest figure since the creation of the euro ( see figure 1 below ). 10. 5 8. 5 figure 1. hicp euro area ( percentage points contribution to hicp ) 6. 5 4. 5 2. 5 0. 5 - 1. 5 jan - 19 food jan - 20 neig jan - 21 energy services jan - 22 hicp core inflation in explaining high inflation, much attention has focused on energy and food price inflation, which have provided the largest contribution to headline inflation, and which are driven by negative supply shocks related to supply chain constraints and russia ’ s war in ukraine. but this is not the full story. positive demand shocks – related to the strong pick - up in demand following the relaxation of covid - 19 restrictions – have also been at play. to me, two main types of evidence point to an important role that demand shocks have played so far. first, for some time now, inflationary pressures have been increasingly broad - based. the contributions to headline inflation of non - energy industrial goods - and services inflation have steadily increased in recent months ( see figure 1 ). note that services, which are not directly affected by higher commodity prices and disrupted production chains, account for 42 % of the euro area hicp. moreover, measures of underlying inflation that we monitor closely to see through temporary shocks have been increasing further, and currently stand at or near their historical maximum ( see figures 2 and 3 ). most notably, core inflation is on the rise and reached 4 % in july. as a number of temporary measures introduced to fight high inflation, such as the german nine - euro public transport ticket, are set to expire, it is unrealistic to assume that core inflation has peaked. 10. 0 figure 2. measures of underlying inflation ( annual percentage changes ) 5. 0 0. 0 - 5. 0 hicp hicp excl energy and food hicp excl energy, food, travel - related services, clothing and footwear supercore figure 3. measures of underlying inflation ( annual percentage changes,