But past experience taught us that their signal is still the most powerful incentive we have. At any rate, I would not rely on political insight or political rules alone. After all, monetary policy must not lose sight of its primary objective: to maintain price stability in the euro area as a whole. What does this mean?
Let us say that monetary policy becomes too expansionary for Germany, for instance. If this happens, Germany has to deal with this using other, national instruments. But by the same token, we could say this: even if we are concerned about the impact on the peripheral countries, monetary policymakers must do what is necessary once upside risks for euro-area inflation increase.