Nobody claims that inflation here must be at precisely the same level as in the euro area generally. It is reasonable to expect some differential at this time in view of our economic conditions but there are obvious limits. The point I want to emphasise is that, if present trends persist, we may have a sharp loss of competitiveness on our hands.
We are in a position to adapt our monetary policy to the strengthening upturn in the future, without seriously harming growth or inflation. And the longer the recovery continues, the less the economy depends on special monetary policy measures. The second factor behind our decision is: how quickly will stronger demand have an impact in the form of rising prices?