This is made concrete in the Governing Council’s decision with regard to the appropriate level of key ECB interest rates, which is taken at the beginning of each month. More specifically, the Governing Council makes an assessment of risks to price stability on the basis of both an economic analysis and a monetary analysis.
The economic analysis focuses mainly on the assessment of current economic and financial developments from the perspective of the interplay between supply and demand in the goods, services and factor markets. The monetary analysis serves as a means of cross-checking, from a medium to a long-term perspective, the short to medium-term indications coming from the economic analysis.