Thus, the mechanism in which the rise in observed inflation alters people’s inflation outlook and behavior, which in turn raises observed inflation, continues to operate. This means that people’s inflation expectations will likely follow an uptrend and inflationary pressure from the rise in inflation expectations will also increase. III.
Ladies & Gentlemen, To sum up, we have major challenges to make the Economic and Monetary Union both more resilient and better able to deliver sustained growth and full employment. That is indeed our common challenge, so let’s focus today on these challenges that really matter to our citizens – which is the only valid yardstick when considering our policy choices.