Let me take this opportunity to stress that the Governing Council of the ECB considers the euro exchange rate an important indicator within the second pillar of the Eurosystem’s strategy. It is closely monitored and influences monetary policy decisions, as it can have implications for the outlook for price stability in the euro area.
The low wage growth and lower commodity prices have meant that CPI inflation has been quite low over recent times. Inflation has also been held down by increased competition in parts of retailing and cost reductions in some supply chains. Slow growth in rents has also played a role.