Thus, as in the case of price stability, central banks face the challenge of managing the trade off between financial stability and growth. 34. It needs to be recognized that after a crisis, with the benefit of hindsight, all conservative policies appear safe. But is there a risk of throwing away the baby with the bathwater?
Finally, but not least, the health of the financial system is inextricably intertwined with the performance of the economy and its resilience to shocks. These are the reasons why the ECB and the Eurosystem have an important stake in financial stability in the euro area.