than halved since 2013. this clearly demonstrates that, in europe, reforms do have a positive impact. 2. our monetary policy is able to combine clarity and flexibility. let me turn to the consequences for our monetary policy : to deal with uncertainty, we have to combine clarity and flexibility, as we did in our december ’ s chained guidance. i will come back to this. in the present context, we should favour state - dependent analysis over time - dependent variables. in other words, we should pay close attention to the economic data in coming quarters and in particular we need to assess the extent to which the recent deceleration in growth and the current drop in inflation are temporary phenomenon or more structural in nature : regarding growth, the current slowdown in the euro area is partly driven by temporary factors, such as disruptions causing contraction in the german manufacturing output, and the impact of the yellow vest movement in france. if these drags fade away, and if geopolitical risks recede, gdp growth could rebound from next spring or summer. indeed, consumption remains solid and continues to be supported by rising wage growth especially in the core countries. but should a downturn last beyond that horizon – a less plausible scenario but one which cannot be excluded – we would be ready to adapt our monetary policy guidance. 3 / 6 bis central bankers'speeches regarding inflation, the fall in oil prices will have a significant downward impact in 2019. after peaking at 2. 2 % in october 2018, euro area headline inflation currently stands at 1. 4 % and will fall to around 1 % in some months of this year. beyond these temporary fluctuations, the key trend to watch is core inflation. the improvement in the labour market has already led to a substantial acceleration in wage inflation. however, it has not yet been passed through to core price inflation. though we are recording some early signals of a price acceleration – such as the services component of the hicp estimated at 1. 6 % 6 in january –, we observe a weakening in the pass - through from wages to prices : here also, is this weakening temporary – due to an increased time lag – or attributable to more structural factors? we have to consider this issue carefully, which is also currently at stake in the united states. in this context, i still believe that the gradual normalisation of our monetary policy is desirable. our chained guidance of last december has been less noticed than the successful end to our net asset purchases. but it

; national association for business economics, vol. 49 ( 2 ), pp. 74 – 84, april. www. perjacobsson. org / lectures / 101213. pdf 4 see kydland, f. and e. prescott ( 1977 ) “ rules rather than discretion : the inconsistency of optimal plans ”, journal of political economy, 85 ( 3 ), pp. 473 – 92 and alesina, a. and l. summers ( 1993 ) “ central bank independence and macroeconomic performance : some comparative evidence ”, journal of money, credit and banking 25 ( 2 ), pp. 151 – 162. 5 see nicholas bloom ( 2009 ), “ the impact of uncertainty shock ”, econometrica, volume77, issue3, pages 623 – 6 the final version is scheduled for publication on 22 february 2019. 7 press conference given by mario draghi, 24 january 2019. 8 “ ecb monetary policy and the resilience of the eurozone ”, columbia university, new york, 19 april 2017, speech by francois villeroy de galhau, governor of the banque de france. 9 address given by mario soares on the european community of the future ( lisbon, 19 october 1990 ). 6 / 6 bis central bankers'speeches