In this environment, there are clear indications of upside risks to price stability at medium to longer-term horizons. Therefore, monetary developments continue to require very careful monitoring, particularly against the background of the expansion in economic activity and still strong property market developments.
To address the upside risks to price stability identified by the ECB’s economic and monetary analyses, the Governing Council has adjusted the monetary policy stance gradually in eight steps since the end of 2005. As a result, the minimum bid rate in the main refinancing operations of the Eurosystem rose from 2.00% in December 2005 to 4.00% in June 2007.