Do we need to push the analogy with those days to the point of believing that a hike in the inflation rate is inevitable? Not at all; but two clear conceptual distinctions are required, as are consistent choices. The first distinction is between relative and absolute prices.
In my remarks today I would like to characterise the current economic situation in the euro area. Furthermore, I will address the roles that monetary policy, supply-side reforms and fiscal policies have played – and can play in the future – in shaping this situation.