These, difficult to predict, changes have affected the position and the slope of the Phillips curve in these economies, that is the relationship between labour market slack and inflation, and pose a number of dilemmas for monetary policy.
These dilemmas would have been lighter if other policies, such as fiscal policy and structural reforms, had been more responsive to the needs of the real economy. Closer to home, the economic expansion in the euro area is continuing and becoming  increasingly resilient.