olli rehn : europe in search of growth and productivity in the shadow of geopolitics speech by mr olli rehn, governor of the bank of finland, at the peterson institute for international economics, washington dc, 22 october 2024. * * * presentation accompanying the speech ladies and gentlemen, dear friends, let me begin by thanking the peterson institute for inviting me to speak at this year's macro week. it is a great honor to share my views with such a distinguished audience. i have followed the institute since nearly its inception, as fred bergsten's book was part of our coursework when i was studying economics and international relations in minnesota. that was in the fall of 1982, a remarkable time in u. s. economic and monetary history, as paul volcker's disinflationary measures were simultaneously reducing both inflation and employment - a reality felt on the streets of st. paul and minneapolis. i must admit, volcker was not especially popular among us students at the liberalleaning macalester college, though he was certainly respected for his consistency and persistence, at least among the economics majors. in hindsight, his actions had historic significance, not just for monetary policy, but also for great - power relations - they helped restore the economic foundations of u. s. global strategic influence. as for me, i could say - if it didn't show a serious lack of self - irony - that this was a formative experience for a future central banker, though at the time, i had no inkling that i would one day enter this field. in every central banker, there is a little paul volcker. – i shall return to the lessons of volcker's disinflation later, in the context of europe's recent experiences. slide 2. roadmap of today's talk you can see the roadmap of today's talk on this slide. i will first of present my thoughts on the ongoing strategy review of the european central bank ( ecb ), which is due for completion in 2025. second, i will focus on the implications of the recent rise in both geopolitical and geoeconomic fragmentation. third and finally, i will discuss what in my view is the achilles heel of europe : weak productivity growth. slide 3. three periods of euro area inflation to provide context for the ongoing ecb strategy review, let's take a look at the history of inflation in the euro

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