As you know, the primary objective of the ECB’s monetary policy is to maintain price stability. The Governing Council of the ECB aims at keeping inflation rates below, but close to, 2% over the medium term. In order to reach this objective we must assess the inflation outlook continuously.
We form our view on future inflation by closely following and monitoring a wide range of indicators that affect inflation and the economy’s output of goods and services. Retail sales is one of those indicators and certainly – as the figures above show – an important one. In my presentation I would like to briefly touch on three questions: 1.