Investment, as a consequence, has not bounced back yet – and probably will not for a while – at the same speed that is customary to see in the early quarters of an economic upturn. Unemployment has settled at unacceptably high levels. Part of it will be reabsorbed as companies will start hiring on more favourable demand prospects.
But a fraction will trail, as it will take time for the longer-term unemployed to adapt to the post-crisis dislocations in the labour market. Today, I will share my views on the challenges the euro area faces in these conditions. I would like to talk about our objective as monetary policy maker, particularly our duty to keep inflation in check.