They gave information about financing conditions and the financial structure, as well as about the condition and behaviour of banks, when these sources of information were critical to the assessment of the health of the transmission mechanism and, more broadly, the state of the business cycle. This dimension of monetary analysis has proven particularly valuable in shaping the ECB’s response to the financial crisis.
There is indeed evidence in support of the fact that, without duly taking monetary analysis into account, inflation in the euro area would have been distinctly higher at times of financial exuberance and would have fallen deep into negative territory in the wake of the financial markets’ collapse, starting in the autumn of 2008.