Over time, we have learned that the best way to fulfill this mandate is to keep inflation low, stable, and predictable. Specifically, that means we aim to keep the annual rate of inflation, as measured by the consumer price index, at 2 per cent. To keep inflation on target, we aim for a balance between total demand and total supply in the economy.
I have not been convinced by the initial Commission proposals. I have expressed doubts that such an approach will lead to an improvement in fiscal rules, but instead, I believe it will do the opposite. The Commission proposes multiannual fiscal adjustment paths. Those paths would have to be agreed by the Commission and every Member State.