For example, one proposal is that central banks might have an explicit role in setting capital ratios in response to emerging risks identified in their financial stability assessments. A further area for discussion is how monetary policy might better respond to asset price developments. For example, should policy “lean against the wind” by tackling asset price inflation more directly.
On the domestic side, investment should benefit from the very favourable financing conditions, the robust growth of corporate earnings currently observed and ongoing improvements in corporate efficiency. Consumption growth should evolve broadly in line with expected developments in disposable income. On the external side, ongoing growth in global demand and improvements in euro area price competitiveness should support euro area exports.