is the era of the omnipotent central banker past its peak? i talked about fiscal policy as a necessary complement to monetary policy since 2014. now the need is more urgent than before. monetary policy will continue to do its job but the negative side effects as you move forward are more and more visible. the ecb has undershot its inflation target much more than other central banks. why is that? have we done enough? yes, we have done enough — and we can do more. but more to the point what is missing? the answer is fiscal policy. that ’ s the big difference between europe and the us. there has been a backlash against the most recent package by some of your colleagues. why did you want to do such a big package? the bigger the package, the bigger the reaction? disagreements about policy happen everywhere, not just in europe. the outlook has worsened, especially for manufacturing. inflation was no longer on track to meet our target. and our policies will continue to work, albeit at a slower pace than if governments were spending more. on the euro, the house is still standing but it is a bit rickety. the house is not rickety. what i see looking back is progress on banking union, on capital markets union — but emu is still incomplete. it just needs a new extension? to have a stronger emu we need a common eurozone budget. clearly the political debate on that still has a long way to go. but i am optimistic. many more people understand the importance of these reforms than a few years ago — there will at some point be a commitment. you don ’ t think we could go backwards? no. people have understood the benefits of the single currency. trust is going up. the opponents of the euro have not succeeded. 10 / 10 bis central bankers'speeches

not saying this with any degree of complacency, by the way. we ’ ve got to continue being persistent, patient, prudent. the situation is improving, nominal wages are now growing at an annual rate of 2. 3 per cent for the euro area and more in certain core countries. this sooner or later will translate itself into higher inflation. it ’ s just taking longer than we thought. do you still think a hard brexit is a possibility? it would not be for me to venture into hypothesis, but simply if you compare the likelihood of hard brexit today with what it was four months ago, one has to admit it has gone up. it has gone up, but there ’ s no plan b. or is there? we have addressed all the possible contingencies within our remit and we worked extensively for three years with the bank of england. but of course being such a broad - ranging event, risks remain. just in terms of the populist climate, there does seem to be a common vein that they are attacking central banks and attacking central banks ’ independence. what do you do in response to that? central banks were made independent because independence is the pillar of their credibility. the 8 / 10 bis central bankers'speeches best response is therefore to continue to pursue our mandate. if central banks deliver what they ’ ve been tasked to do, that ’ s the best answer to some of these concerns. it is also essential to explain better and better what we do. communication again. frankly i think it would be a mistake to reverse central bank independence. i ’ ve lived in periods when central banks were not independent and it was definitely worse. so i ’ ve got to find a way of asking politely, all great leaders think about their succession … yes. it ’ s a political decision, but how far do you feel what you say and do now is in effect intended to exert influence beyond your tenure? succession is a fact enshrined in the treaty. decisions about it are a political task. my duty is only to continue to serve the mandate until the very end of my term. so just thinking ahead, if you had to identify the two or three things you ’ re very concerned about now and possibly contingencies, what would they be? growth has weakened in most advanced economies, especially where trade and manufacturing are important, such as germany and japan, with gdp growth projected to be at or below 1 % in