. 4 we are undoubtedly experiencing a solid, broad - based and resilient economic recovery that is 2 / 3 bis central bankers'speeches contributing to a narrowing of the output and unemployment gaps. but there still appears to be a disconnect between growth and inflation. as slack in the economy continues to be absorbed, reflationary forces will gradually build up and the traditional phillips curve connection between inflation and the business cycle should eventually reassert itself. that being said, current estimates of the slope of the phillips curve appear to be flatter than in previous times, which could be interpreted as an indication that the relationship between economic slack and inflation has weakened. this could be due to either a mismeasurement of slack ( because of structural changes in the labour market ) or the relationship between slack and inflation not being stable over time. at the same time, this effect could also result from discrete parallel shifts in the phillips curve. such parallel shifts may occur because of temporary changes in wage and inflation mark - ups, or – more concerning from a central bank ’ s perspective – the incipient dislodging of inflation expectations. in an extreme scenario, the entrenchment of disinflationary developments could sustain a downward drift in the phillips curve and unmoor inflation expectations. empirically disentangling these factors is extremely difficult, so such considerations need to be borne in mind when discussing the relationship between economic slack and inflation developments, particularly in an environment of uncertainty over the anchoring of inflation expectations. it is our primary task, as a central bank, to ensure that the reconnection of the real and the nominal sides of the economy – what i referred to before as the phillips curve regularity eventually reasserting itself – occurs at a steady state rate of inflation that is consistent with our medium - term aim : a level below, but close to, 2 %. we have not yet accomplished our mission, and so we must remain patient and persistent. patience is required for inflationary pressures to show through convincingly in the data. the euro area ’ s economic environment is improving, and the negative tail risks to inflation expectations, which were clearly visible at the start of our asset purchase programme, have virtually disappeared. but measured inflation rates are exceedingly volatile and metrics of underlying price pressures remain weak. the entire distribution of inflation expectations still needs to shift a fair distance to the right. we must also be persistent in using our policy instruments to ensure a durable

. i understand that some observers in this country have concerns about the medium - term implications of this policy. so let me be clear : we always have a medium - term orientation. we are steadfastly committed to our mandate to maintain price stability. and the measures we have announced fully support this commitment. first of all, our actions are for the sole purpose of ensuring the proper transmission of monetary policy. they do not aim to finance governments, and nor would they if they were activated. our operations would only take place in the secondary market, which ensures that money would pass to investors holding sovereign bonds, not to governments. bis central bankers ’ speeches moreover, we have been explicit that our measures can be only successful if they are accompanied by reforms from governments that address deep - rooted issues. the governing council has made a strong commitment to such reforms a pre - requisite to be considered for our operations. this ensures that governments will continue to take essential measures. euro area citizens can be certain that we remain alert to any risk to price stability. we have always delivered price stability in the past – indeed, the average rate of inflation in germany since the launch of the euro has been the lowest since the 1950s. and we will continue to deliver price stability in the future. the credibility of our commitment is clear. indicators of inflation expectations show that citizens and financial markets expect inflation to remain low in line with our mandate. we take very seriously the trust that citizens put in us to meet their expectations. we will not let them down. building a bridge to the long term i have discussed the actions that the ecb has taken to ensure price stability and the positive early impact they are having. of course the current improvement in sentiment does not mean that everything is solved. the ecb ’ s actions can only build a bridge to the future. the project must be completed through decisive actions by governments – both individually and collectively – to address the underlying causes of our current challenges. this requires further efforts by governments to restore fiscal sustainability across the euro area. it requires deep structural reforms to achieve long - term competitiveness and growth. governments must remain firmly committed to their current reform efforts, and not seek to relax them as economic conditions start to improve. to secure long - term stability also requires a second level of actions. for citizens and investors to fully regain confidence in the euro area, they need to be convinced that its design flaws have been permanently fixed. a concerted effort from governments to complete our economic and