The higher commodity prices – which, as I said earlier, mainly reflect the good performance of emerging economies and are therefore, at least in that sense, a blessing – are a real impoverishment for the euro area economy which cannot be avoided.
Higher wage claims or price increases seeking compensation for such a deterioration in the terms of trade only postpone necessary adjustments and only lead to a longer period of higher inflation without any longer-run real benefits. Therefore, a solid anchoring of inflation expectations is essential and the Governing Council will do whatever is necessary to maintain price stability over the medium term.