the loss of on - the - job knowledge. and weaker sales expectations may lead to firms investing less in capacity. with these risks in mind, it makes sense for the euro area to take advantage of the favourable financing conditions created by monetary policy to launch a stronger fiscal stimulus in order to rapidly return growth to its pre - pandemic path. the focus must be on productive investment, so that spending is concentrated on projects with high multipliers. the additional investment required is well within our reach. according to simple, illustrative estimates, extra spending [ 33 ] on productive investment of around 2. 8 % of gdp [ 34 ] would be sufficient to reconnect with the pre - crisis growth trend by 2022 ( chart 10 ). chart 10 euro area real gdp : reconnecting with the pre - crisis trend ( index : 2019 = 100 ) source : ecb illustrative calculations. conclusion my main message today is that europe ’ s economic trajectory is in our hands. the inflation process is still a domestic phenomenon which forceful monetary policy can control. the ecb has already asserted its monetary autonomy and will continue to use it to bring inflation back to our aim of 2 %. this, in turn, enables fiscal authorities to use the space available to them to bring about a full recovery, which would guarantee higher productivity, more sustainable debt and more inclusive growth. 1. i would like to thank jonathan yiangou, jean - francois jamet, georgios georgiadis, michele ca'zorzi, johannes grab and eric persson for their support in preparing this speech, as well as david lodge, maria grazia attinasi, alessandro giovannini and isabel vansteenkiste for their helpful comments. 2. see, for instance, the economist ( 2019 ), “ low inflation is a global phenomenon with global causes ”, 10 october. 3. delle monache, d., petrella, i. and venditti, f. ( 2016 ), “ common faith or parting ways? a time varying parameters factor analysis of euro - area inflation ”, advances in econometrics, vol. 35, pp. 539 - 565. 4. auer, r. a., degen, k. and fischer, a. m. ( 2013 ), “ low - wage import competition, inflationary pressure, and industry dynamics in europe ”, european economic review, vol. 59 ( c ), pp. 141 - 166 ;

transparency in the area of international reserves. keeping the incomplete coverage of the imf data in mind, we can observe that the share of the euro has risen from 18 % in 1999 to around 25 % in 2003. since then, if one adjusts the imf figures – which are published in current exchange rates – for valuation effects, the share of the euro in global foreign exchange reserves has remained relatively stable hovering around 24 - 25 %. interestingly, this relatively stability of currency shares in global foreign exchange reserves persisted during the onset and intensification of the global financial crisis. in the fourth quarter of 2008, the share of the euro rose by around one percentage point – again, after adjusting for valuation effects ( chart 1 ). it is conceivable that these latest developments have been mainly driven by emerging market central banks which have intervened to defend their currencies during the second half of 2008 and have mainly done so by selling us dollar - denominated assets. whether one should attribute this latest moderate increase in the share of the euro to a genuine change of currency preferences is therefore not obvious. ladies and gentleman, please also allow me to reflect a bit more generally about the nature of international reserve currencies. what are the requirements for a currency to achieve such a status? price stability and the depth and liquidity of the respective capital market are important elements, and the euro appears to qualify in this regard. for example, in terms of liquidity, the euro appears to have become in the perception of reserve managers the second most attractive currency in the world ( chart 2 ). but what are the other factors that finally create a major international currency or even a “ currency of exorbitant privilege ” such as the us dollar? recent research has shown that we can also use standard portfolio theory in order to get some useful insight into this question. for example, it appears that over the past 30 years it made sense for a global bond investor – like a central bank – to be long dollar since the dollar has been a good hedge for such a portfolio. 1 one can also use standard portfolio theory in order to explain more specifically the currency choice in central bank portfolios over the past ten years. in fact, ecb research has shown that for many emerging markets with pegged or managed exchange rates it made a lot of sense to hold a sizable fraction of official reserves in their “ anchor currency ” which is often the dollar. 2 the underlying reason is not that these central banks