So having a narrow mandate allows us to spell out what the ECB can and can’t do and remind other players of their responsibilities and, in some cases, their shortcomings. It also gives us a great deal of flexibility, since the objective of price stability leaves us plenty of scope to choose our tools, as has been seen during the crisis.
And this means that it is moving towards full production capacity more quickly than we had expected. Core inflation has also been running slightly higher than we anticipated, at 2.2 per cent in April. Against this backdrop, last week, the Bank raised its target for the overnight rate by 25 basis points to 2.50 per cent.