pandemic. these pipeline pressures will fade only gradually and will likely remain a source of upward pressure for consumer prices over the foreseeable future, with most firms expecting unusual cost pressures to persist for at least another six months. in addition, in large parts of the euro area the recent surge in wholesale electricity and gas prices will only be passed through to consumer prices with a lag. there is also a lot of uncertainty whether energy inflation will decline to the extent suggested by the futures curves underlying our december projections ( slide 7, right - hand chart ). brent oil spot prices are now at their highest levels since 2014 and current futures curves are well above the levels seen at the end of last year. gas futures prices, too, are markedly higher than in december of last year. while in the past energy prices often fell as quickly as they rose, the need to step up the fight against climate change may imply that fossil fuel prices will now not only have to stay elevated, but even have to keep rising if we are to meet the goals of the paris climate agreement. 2 in the eu, price developments under the emissions trading system ( ets ) signal such an impending structural shift. ets prices have recently reached a new record high of around €90 per tonne of carbon, almost three times as high as at the beginning of 2021, and they are expected to remain at elevated levels for the foreseeable future. it is a reminder of the challenges we are facing in anticipating potential structural shifts in the underlying inflation process that could extend well beyond the energy sector. 3 sequencing of policy normalisation in the euro area all in all, there have been few instances in the recent past where the information set available to policymakers has changed so profoundly and in such a short period of time as has been the case since the beginning of the year. how today ’ s attack on ukraine changes the euro area outlook is highly uncertain at this stage. we are monitoring the situation closely and will carefully evaluate the consequences for our policies. based on the macroeconomic situation predating the war, however, inflationary pressures will likely prove stronger and more persistent over both the near and the medium term. policy optionality is therefore needed more than ever to protect price stability. 4 our decisions in december of last year to end net asset purchases under the pandemic emergency purchase programme ( pepp ) in march and to recalibrate the path of future purchases under the asset purchase programme ( app ) have been a first

this is to strengthen the governance and monitoring of economic and fiscal policies. that does not mean to say that the functioning of the financial markets does not need to be substantially improved. at the moment, the key word for all industrialised countries is “ confidence ”. yes, but it is possible to speculate on whether greece will default. such a speculation would be a sure - fire way of losing money given the decisions taken last thursday. and let me say again, the euro, as a currency, is sound and credible, and is not affected by the pressures on sovereign risks. don ’ t the rating agencies play the speculation game? i think that this is an important issue for financial stability at the global level. here we see a very small number of institutions having an enormous international influence. the patently bis central bankers ’ speeches oligopolistic way in which the rating agencies work is certainly not optimal in terms of market organisation. this configuration is structurally “ pro - cyclical ”, in other words it fuels the creation of bubbles during cyclical upturns and exacerbates the busts during cyclical downturns. these failings must be addressed. this is easily said, and more difficult to do … you will be relinquishing your duties this coming november. what does this mean for you? my professional life has been shaped by both the pursuit of long - term or very long - term strategies such as the construction of europe and by a series of crises. when i started my career as a civil servant i had to deal with the first oil price shock in 1973 – 74, which was an enormous blow to the whole of the industrialised world. unfortunately, because we responded poorly, particularly in europe, this shock was the start of mass unemployment. i have also lived through the sovereign debt crises in latin america, africa, the crisis in the soviet union, the crises of the exchange rate mechanism of the european monetary system in 1992 and 1993, and of course the asian crisis, the bursting of the dot. com bubble and the ongoing crisis that started in 2007 – 08. the truth is, i have always been living through crises. this has led me to conclude that, in a world that is undergoing extremely rapid transformation thanks to science and technology, the global spread of the market economy and the fantastic progress made by china and india, it is necessary to be constantly on one ’ s guard and in a state of alert. i first elaborated on this view in a