If the markets' path for appropriate policy were at odds with my judgment about appropriate policy, I would have to write down a forecast whose path or end points were not consistent with what I believed were our best efforts to achieve our objectives.
After the ECB President’s pledge “to do whatever it takes to preserve the euro” in the period following the OMT announcement, tensions in sovereign bond markets subsided, with Spanish and Italian ten-year government bond yields to fall significantly. In essence, the ECB reaffirmed its full commitment to our price stability mandate, sending a strong message to financial markets.