However, while the role of financial conditions in the transmission process has remained as relevant as ever, the task of steering them in line with domestic macroeconomic policy objectives has become more challenging in view of the manifold dislocations in financial markets that have arisen since the crisis and the proximity of standard policy instruments to their lower bound.
The ECB’s unconventional measures have confronted these challenges and ensured an appropriate degree of accommodation by fostering very favourable financing conditions. Our monetary policy is working, and we see that, supported by our mutually reinforcing monetary policy measures, the euro area economic recovery is steadily firming.