makers are now increasingly making a central part of their objective the overall aim of emu : to sustain economic well - being in the absence of major imbalances, and to generate sustainable growth in a competitive environment. in my view, a great deal of progress is underway in this respect. for example, the irish authorities have maintained a strong track record for maintaining reform momentum throughout their programme. they have also taken important steps towards restoring the stability of the financial system. in portugal, programme implementation remains good and important progress has been made in such areas as the labour market, the housing market, the general competition framework, the judicial system and the transport sector. the portuguese authorities remain fully committed to achieving this year ’ s fiscal target. the spanish authorities too have shown that they remain fully committed to accelerating the structural reform agenda and putting the financial sector on a sound footing. they are also committed to improving external competitiveness to lay the foundations for more sustainable prosperity. even without programmes, many policy - makers are bold in reform. in italy, for example, reforms to increase competition, reduce the administrative burden and increase labour market flexibility have been important measures. the country ’ s spending review will help to achieve the fiscal targets. virtually all other countries are undertaking measures to improve fiscal solidity and the basis for sustainable growth without excessive imbalances. so despite the current challenges, countries ’ progress is strong and the fundamentals of the euro area as a whole are sound. the euro area ’ s fiscal deficit is declining towards 3 % of gdp ; price stability is ensured ; and the external accounts have remained close to balance. all these are reasons to pursue reforms with a strong degree of confidence. 4. a longer - term vision for emu why then do we still have tensions in a number of market segments? let me first stress that a lot has been done at country as well as euro area level in terms of economic reforms and governance. but we need full implementation. we have to make clear that emu is a union based on stability at national and aggregate levels. bis central bankers ’ speeches stability at national level means completing reforms to ensure sustainable growth without major imbalances. stability at aggregate level means implementing the vision recently presented at the summit. the central message of that vision is this : the euro is here to stay – and the euro area will take the necessary steps to ensure that. in my view, the core of the report submitted by president van rompuy is the identification of four building blocks

area growth ; on the upside, risks could stem from further increases in indirect taxes and higher than expected energy prices. our monetary analysis gives a picture consistent with price stability over the medium term. in particular, the underlying pace of monetary expansion remains subdued. weak loan growth largely reflects the current cyclical situation, heightened risk aversion and balance sheet adjustments by households and firms, which weigh on credit demand. bis central bankers ’ speeches 2. central banks ’ response to the crisis let me now turn to the first topic you asked me to address, the measures taken by central banks around the world in response to the global financial crisis. in a nutshell, i consider those actions to have been bold, forward - looking yet historically informed, drawing appropriate lessons from financial crises of the 20th century. central banks have cooperated very closely during the crisis : through an important coordinated interest rate cut in october 2008 ; provision of swap lines ; continuous information exchange ; and overall actions that have been mutually consistent. in particular, the overriding objective of medium - term price stability has never been lost from sight. both interest rate policy and non - standard measures have taken account of the prevailing specific circumstances : first, the financial and economic structure of each economy ; second, the magnitude and specificity of shocks ; third, the different operational frameworks of different central banks ; and fourth, the different institutional settings in which they operate. for these four reasons, comparisons across constituencies have their limits. what ’ s more, comparison of the size of central banks ’ balance sheets may give a distorted picture of the extent of policy action. for example, in the eurosystem, a significant part of the balance sheet is not related to monetary policy but to gold and foreign exchange reserves. therefore, the appropriate way to measure a central bank ’ s actions is to do so in its own institutional and economic setting and against its own objectives. for the ecb, those actions have been, and will continue to be, geared towards maintaining price stability in the euro area. this is our mandate, and our track record speaks for itself. 3. the ecb ’ s role in adjustment programmes effective crisis resolution needs bold actions by central banks but it also needs bold actions by other policy actors, notably governments. this brings me to the other topic that you proposed : economic adjustment programmes and the role of the ecb. in the aftermath of the crisis, a number of eu and euro area countries have requested financial assistance because of their challenged access to