We also need more ambitious policies aimed at increasing the supply of private equity, and especially of early-stage venture capital.15 The development of fintech has the potential to expand access to credit and other financial services, in particular for small businesses.16 More broadly, to ensure an attractive investment environment in the euro area we should seek to complete the banking union, ensure adherence to fiscal rules and fully implement structural reforms.
At our announcement date six weeks ago, we did not have a new projection in which to work out all the details and balance the forecast risks. The economy still had a significant degree of excess capacity, which acts to pull inflation down over time. Further, relative to our projection in the April MPR, we were monitoring growing downside risks on global economic activity.