Analysis under the second pillar focuses on the short-to-medium-term risks to price stability. It is based on a broad range of information about wages, commodity prices and exchange rates, asset prices, wealth, external demand, fiscal policy, and domestic financing conditions and costs. The Eurosystem's approach to structuring its analysis under two pillars was innovative. Not surprisingly, it triggered many discussions as well as criticism.
The latter focused on the reference value and the co-existence of two distinct pillars. The first pillar and the use of the reference value Much of the criticism owes to an overly simplistic understanding of the first pillar as a simple comparison between observed monetary growth and the reference value.