At the same time, this test is only a very good first step and the results will be taken into consideration in the day-to-day supervision which the ECB will conduct as of 4 November. Will the test be sufficient the restore trust in the banks? Was the adverse scenario of the stress test sufficiently severe?
In turn, such signals support the medium-term orientation of monetary policy, guarding against an excessive focus on short-term developments in inflation forecasts, as well as misguided attempts to fine-tune economic developments. This commitment to conducting a monetary analysis provides us with an insurance device. It disciplines decision-making.