But no mechanism or institution existed to ensure that admonitions were followed by decisive and swift action. The new European system would assign the task of pre-emptive analysis and grant the necessary authority to put risk mitigation measures into practice. With regard to the appropriate balance between near-term stimulus and medium-term stability, the euro area clearly benefits from its medium-term stability-oriented framework.
It is an invaluable anchor for private sector expectations, regarding both fiscal sustainability and price stability. Having proved its value in times of crisis, this framework has emerged even stronger than before.