Monetary policy in an uncertain environment  At the start of 2014, the macroeconomic landscape in the euro area was characterised by a high degree of uncertainty. On the one hand, we were confronted with a consistent and broad-based downward trend in past inflation, falling from 3% at the end of 2011 to less than 1% at the beginning of 2014.
But on the other, sentiment on the economic outlook was relatively upbeat for 2014, with nearly all forecasters expecting the recovery to firm over the course of the year. In this context, while we felt relatively comfortable that the medium-term inflation outlook was secure, the risks surrounding that outlook were clearly elevated.