recent years. finally, the recent decline in energy prices, if it is sustained, should reduce cost pressures along the production chain. one upside risk to the inflation outlook comes from the labor market. the unemployment rate declined steadily between the second half of 2003 and the beginning of 2006 and has stood at a relatively low 4. 7 percent for the past six months. with labor markets comparatively tight by historical standards, unit labor costs have begun to accelerate, especially since the end of last year, and firms may pass on some of these higher costs to consumers. however, the large markup of prices over costs - the margin is currently well above its historical average - could act as a shock absorber if cost strains were to intensify. thus, in my judgment, inflation appears poised to decelerate in coming months as energy prices stabilize and resource pressures ease. but the risks to that outlook seem tilted toward the upside. aggregate supply in considering the appropriate setting for monetary policy, the level of the economy ’ s underlying productive capacity - its potential output - is the benchmark against which we assess actual output. accordingly, whether the recent slowdown in economic activity eases resource constraints enough to reduce inflationary pressure depends importantly on how fast potential output is growing. if the key determinants of potential output - the workforce, economic efficiency, and the capital stock - grow quickly, as they did in the second half of the 1990s, then gdp can also rise quickly without increasing the pressure on the economy ’ s resources. conversely, a reduced rate of growth of potential output would require slower growth of actual gdp to keep resource pressures from increasing. i ’ d like to spend a little time examining in greater depth the outlook for some of the factors that determine potential output, starting with the labor force. the size of the labor force depends on a combination of two factors : the size of the working - age population and the likelihood that members of this population join the labor force - a likelihood that economists refer to as the labor force participation rate. the labor force participation rate tends to vary over the business cycle as potential workers become more or less encouraged about job prospects. however, the influence of labor force participation on potential output does not depend on short - run conditions in the labor market but rather on long - run changes due to demographic and social factors. for instance, in the 1950s and 1960s the labor force participation rate stood at just under 60 percent. in subsequent years, women entered the labor force in large numbers and

mario draghi : unveiling of the 5 euro banknote of the new europa series short address by mr mario draghi, president of the european central bank, at the archaeological museum, frankfurt am main, 10 january 2013. * * * ladies and gentlemen, i too would like to warmly welcome you to today ’ s event and thank you for having accepted our invitation. in particular, i would like to thank you, mr wamers, for your kind words. i am very pleased that you have made available this special setting of the archaeological museum for the unveiling of the new 5 euro banknote and for the hosting of the “ new face of the euro ” exhibition. frankfurt is one of the european union ’ s financial capitals, a very international city and an important one for trade and finance in germany. this is one of many reasons why frankfurt has become the city of the euro and the seat of the european central bank. this museum, among its many treasures, displays items from classical antiquity. so it is quite appropriate for europa, a figure from greek mythology, to be on show here and for us to unveil the new banknote that includes her portrait. the 5 euro will be the first banknote of the second series of euro banknotes, the so - called “ europa ” series. it will gradually replace the first series of euro banknotes, which was introduced on 1 january 2002. that ’ s the date most people remember – it was when the euro finally became “ real ” for 300 million citizens in the then 12 euro area countries. and it was one of the milestones laid down by the founding fathers of economic and monetary union in the treaty of maastricht more than 20 years ago. over the years, euro banknotes have become the most visible symbol of european integration. the single currency, the euro, was conceived as a key step towards that goal. despite the challenges facing the euro area, progress was made in 2012 and i am confident that 2013 will bring a deepening of economic and monetary union and will strengthen european integration. the ecb plays a key role in bringing the countries of europe closer together. besides our core function and mandate to guarantee price stability in the euro area as a whole, one of our tasks is to develop what we could call “ our product ”, the euro banknotes. the new series of banknotes will continue to reflect the unity and diversity of our continent. the word “ euro ” is now written in the