In my remarks, I will focus on some of the issues of particular importance to the ECB, where nonlinearities assume a significant role. These include issues related to the conduct of monetary policy at the zero lower bound (ZLB), housing, financial markets and the macroeconomy, fiscal policy and the European sovereign debt crisis.
Notably, however, most risk spreads have remained narrow even as we have been removing policy accommodation. My purpose today has not been to interpret or forecast risk premiums or the specific way in which they will affect the future path of monetary policy.