ECB analysis for the euro area finds that, while monetary policy was supporting inflation during this period, it was being offset by demand headwinds. The implication is that, in the current environment, both policies must remain expansionary for as long as necessary to achieve their respective goals.
[12] Borio, C. (2016), “Towards a financial stability oriented monetary policy framework”, speech at the conference “Central banking in times of change” on the occasion of the 200th anniversary of the Central Bank of the Republic of Austria, 13-14 September. [13] Cerutti, E., Claessens, S. and Laeven, L. (2017), “The use and effectiveness of macroprudential policies: New evidence”, Journal of Financial Stability, 28, pp.