and the main remedy for this disease. i won ’ t make comments about yesterday ’ s governing council and monetary decision. but our collective fight against inflation calls for a more appropriate policy mix : the revision of the european economic governance framework provides a major window of opportunity to realign fiscal and monetary policy. page 2 sur 4 alongside high inflation, public debts have reached historical levels mainly due to unprecedented waves of shocks, but also, for several countries, to legacy debts. now that these shocks are fading, governments must avoid an overly expansionary stance that would further fuel inflationary pressures. we therefore need a more coordinated and realigned fiscal and monetary stance. better alignment of fiscal and monetary policies would unleash greater efficiency of the policy mix : everyone agrees on this point. the question is how to ensure a better coordination between fiscal authorities – overseen by the commission within the european semester – and the ecb, which are both independent, and have specific mandates. well : coordinating two independent and strong - minded personalities is always challenging, even more so with two independent institutions. in my view, they can be seen as travellers that have to take a journey together. they did not necessarily choose each other, but they can follow simple rules of cohabitation. ( i ) agree on the destination, i. e. the respective “ anchors ” of the 2 % inflation target over the medium term, and the medium - term debt reduction path ( ii ) ensure a continuous dialogue to foster mutual trust and address divergences. moreover, the higher the inflation and interest rates, the harder it is to manage public debt. attention is increasingly focusing on the sustainability of public finances, and rightly so. in this context, the july eurogroup statement on the euro area fiscal stance, ii which highlights the need for fiscal consolidation, is very welcome. this is also true for france, which should avoid drifting towards a gloomy resignation about the constantly increasing government expenditure ( 58 % of gdp vs 51 % on average in the euro area in 2022 ) and public debt ( 112 % vs 94 % ). moreover, my country failed in the past to meet its commitments on budgetary targets. i strongly hope the next pluriannual public finance programming bill and the 2024 budget will demonstrate increased commitment and credibility. * * page 3 sur 4 the reform of eu fiscal governance underway is a key opportunity to reestablish a sound framework for public debt management. in april 2023, the commission published its

% believe in the wisdom of institutional processes or in enlightened economic debates for sufficiently steering national cycles. they must be complemented with common rules and anchors to ensure fiscal discipline. in other words, in the famous rules / discretion debate, we need indeed more discretion … but not too much ; and we need less mechanical or obscure rules, but we still need rules. the setup should indeed ensure binding thresholds for the minimal annual adjustment of public finances. let me add that the more we progress effectively on national fiscal discipline, the easier we could envisage a common fiscal capacity – which we badly need. mario draghi eloquently advocated it recently, v and i wish it will be part of his new mission on competitiveness in europe. * * * to conclude, let me borrow a fundamental principle from physics, stated by isaac newton : “ when two forces unite, their efficiency double ”. well, it is time to combine the two forces of our monetary and fiscal policy, towards a greater efficiency of our euro area economy and to the benefit of our citizens. thank you for your attention. i press release : governors and heads of supervision endorse initiatives in response to the banking turmoil and reaffirm priority to implement basel iii. ii eurogroup statement on the euro area fiscal stance for 2024, press release, 13 july 2023. iii c. bouthevillain, s. debu, towards a much - needed reform of eu fiscal rules : the european commission ’ s proposals, banque de france bulletin no. 246 : article 2, 21 june 2023. iv x. debrun, l. jonung, under threat : rules - based fiscal policy and how to preserve it, european journal of political economy. v the economist, mario draghi on the path to fiscal union in the euro zone, 6 september 2023.