Why does the Eurosystem define price stability as an increase in this index of below, but close to, 2 per cent over the medium term? Papers presented at the 1999 meeting of the Ottawa Group provided answers. The Eurosystem’s definition of price stability includes a safety margin against deflation.
1/8  BIS central bankers' speeches  Within any country and, in particular, across the different economies within a monetary union, there is a need for structural change and adjustment of relative prices. In the presence of nominal rigidities, positive inflation allows for the required adjustment of relative prices.