a reasonable balance between letting automatic stabilisers operate and seeking further consolidation where needed. in some cases, current consolidation ambitions are weak. in order to further boost confidence in the fiscal framework and the economic environment, it is essential that appropriate consolidation plans are implemented in all countries with remaining imbalances. hence, the commitments made in the stability programmes and the requests to further improve fiscal positions, as subsequently agreed in the ecofin council, must be implemented in full. in this respect, the measures should be part of a comprehensive and growth - oriented strategy, which for most countries means putting the focus on both restraining the volume, and reforming the structure, of public expenditure. finally, the outlook for the euro area economy could be significantly improved if governments strengthen their efforts to implement structural reforms in labour and product markets. such reforms are important to ultimately raise the euro area's production potential, improve the flexibility of the economy, and make the euro area more resilient to external shocks. in particular at the current juncture, when economic activity is subdued, taking measures to make the euro area a more attractive place to invest in can contribute substantially to fostering confidence. we are now at your disposal for questions.

the repo rate in their forecasts ( see figure 5 ). 12 although the market's forecasts were better than the riksbank's during the period 2011 – 2013, the pattern is essentially the same – substantial overestimates and inaccurate forecasts. a brief remark is in order here. sometimes one gets the impression from the debate that it is only the riksbank that has produced inaccurate repo rate forecasts, while most analysts, including the market, have been quite successful. apparently, this is not the case. one may perhaps object that the market may not produce forecasts of its own, but merely assumes that the riksbank will follow its reporate path. but the experiences of the period 2011 – 2013 indicate that this is not really the case. i think this is a useful picture to bear in mind. if one wants to implement a makeup strategy in a situation where the repo rate is at the lower bound, it is probably necessary to use a more convincing approach than delphic forward guidance. the alternative to delphic forward guidance is called odyssean forward guidance. this name is also taken from greek mythology and refers to odysseus, who had his men tie him to the mast so he would not be tempted by the song of the sirens and steer his ship towards the cliffs. in terms of monetary policy, this strategy is less dependent on the accuracy of the forecasts ; instead it is a case of committing oneself to not deviating from the interest - rate development one has indicated. but odyssean forward guidance also has its problems. binding oneself to a particular monetary policy no matter what may on the one hand indicate strong determination and thereby have an effect on expectations. but on the other hand, such a policy may appear obstinate and unrealistic. if events occur that cause the policy to appear as inappropriate or directly harmful, it will be difficult to implement it. 13 and once one has deviated from a strategy which one has firmly undertaken to follow, one will hardly appear credible when trying to apply it the next time. when applying a makeup strategy, a less strict odyssean forward guidance might mean that the central bank – in accordance with predetermined and clarified principles – makes it clear that it will hold the policy rate at the lower bound until inflation, or perhaps some measure of the development of the real economy, has 12 for more detailed analyses of the riksbank ’ s experiences