The more heterogeneous an economic area, the harder it is to govern with a single interest rate. That is of course felt especially painfully when economic conditions are tough. We therefore need the euro area Member States to pursue economic policies that will ensure sustainable economic growth for all.
The competitiveness of each individual Member State must be strengthened through sound fiscal policy and structural reforms. And in places where we see overheating occurring, we must use targeted macro-prudential supervisory tools… ....that is supervision of the whole financial system with targeted regulation.