Measures of underlying inflation remain rather muted, having moved largely sideways over recent months. At the same time, inflation dynamics are supported by strengthening labour cost pressures amid high levels of capacity utilisation and tightening labour markets. In fact, recent data on negotiated wages point towards a continuation in the upward trend in wage growth, which is expected to gradually push up underlying inflation.
For one thing, the information gathered in supervision has been particularly useful in the preparation of monetary policy decisions during the financial crisis. This has been especially true when and since the Governing Council of the ECB decided to introduce non-standard monetary policy measures to ensure the proper transmission of the monetary policy stance.