, might significantly overestimate inflation. 6. let me also add that we should pay attention to the interactions among these ( and other ) conditions. a very relevant aspect is that too low inflation for too long makes it more difficult to deal with public and private debt. related to this, as shown by recent research, the interaction of falling inflation and nominal interest rates at the zlb with nominal debt and downward nominal rigidities can lead even favourable transitory supply shocks ( such as a reduction of the price of oil ) to have negative effects on economic activity. 2 “ the outcome of the ecb ’ s evaluation of its monetary policy strategy ”, ecb monthly bulletin, june 2003. neri, s. and a notarpietro, “ the macroeconomic effects of low and falling inflation at the zero lower bound ”, banca d ’ italia, temi di discussione ( working papers ), no. 1040, 2015. bis central bankers ’ speeches why does inflation remain low? do global forces dominate, and is monetary policy still effective? 7. low inflation certainly has a global dimension. it reflects developments in oil prices ; deflationary pressures coming from the chinese economy ; possibly technological change. but it also reflects domestic developments that should not be underestimated. domestic factors operate both via expectations and via economic activity, and in both respects conditions in the euro area differ from those in other main advanced economies. 8. although declining inflation expectations has been a global phenomenon, since the end of 2014 the risk of a de - anchoring has increased particularly in the euro area, where expectations have reached lower levels than in other advanced economies. 3 a measure of this risk can be inferred from the probability that large changes in short - term expectations will be passed on to long - term expectations. 4 this indicator climbed from october 2014 until mid - january 2015 in the euro area, while no increases were recorded in the u. s. or the u. k. over the same period ( figure 1 ). after the extension of the app to include public sector securities the indicator decreased sharply, but remained volatile and above the historical average. 9. let me also point out, in this respect, that the importance of expectations of low inflation in determining wage outcomes, and thus giving rise to second - round effects, may be increasing. in italy, in some recently signed collective contracts it was agreed that parts of future pay rises will be revised downwards in the event that the inflation rate

reise was an essential bridge between the culture of germany and that of the land wo die zitronen bluhen. the programme for these days revisits our cultural heritage, our artistic and historical legacy, but it also reflects the culture and cultural activities of present - day italy. classical music is the centrepiece of the opening and closing concerts as well as the charity event, but there will also be presentations of contemporary italian music. the italian film days are entirely given over to contemporary directors and will offer the opportunity to reflect on the ways in which the traditional italian family model has changed. in literature, the themes range from the deeper meaning of cultural identity to the role of women in the risorgimento. this evening the orchestra mozart will perform the opening concert under the baton of claudio abbado. the maestro ’ s career, his essential embodiment of the universal language of music, certainly needs no presentation. i cannot even begin to sum up the course of his art. let me merely recall that he has conducted some of the world ’ s greatest orchestras : the berliner philarmoniker, the wiener philarmoniker, la scala. constantly engaged with social problems and active in promoting the artistic growth and careers of young musicians, claudio abbado has founded a series of orchestras for young instrumentalists of artistic excellence, including notably the chamber orchestra of europe and the orchestra mozart, which came bis central bankers ’ speeches into being in bologna. both draw their players from a vast range of different countries, talented young musicians playing alongside established soloists. the orchestra mozart owes its name to the role that the city of bologna played in mozart ’ s development. it was with the philharmonic academy of bologna – one of the centres of european cultural life – that mozart, at the age of fourteen, took his diploma as “ maestro compositore ” on the 9th of october 1770. music as solidarity, music as social life, music as at once expression of and factor in personal and cultural growth. these are the values that claudio abbado and all these young musicians have brought with them to the orchestra mozart, from the very start. now, it is my pleasure to leave you to the sublime art of gioacchino rossini. claudio abbado conducts the orchestra mozart in the overture to the barber of seville. bis central bankers ’ speeches