One of the lessons of this crisis is that central bankers should not be guided by excessively narrow inflation targeting but should pay attention to the build-up of financial imbalances, which may not immediately exert pressure on prices, but an abrupt correction of which may put price stability at risk.
The Governing Council can claim that the medium-term orientation of its strategy and its monetary analysis are assets in this respect. A few years ago, at a previous SUERF conference, I announced that M3 might abandon us. And indeed, the long-run relationship between M3 and prices proved to show signs of instability.