This may become a problem for the euro area, if such differences become persistent and hamper the transmission of monetary policy and the smooth functioning of the currency union. The ECB can only make monetary policy for the euro area as a whole, without tailoring it to the needs of any particular country. This makes it vital that such divergences in national inflation and real interest rates are kept in check by national structural and fiscal policies. Government support measures that are taken to shield the economy from the impact of high and volatile energy prices must be temporary and well targeted so that they preserve the right incentives for consumers and energy producers, and do not overburden government finances. In setting monetary policy, central banks must not hesitate to fight high and persistent inflation. Keeping prices stable is the best contribution we can make to the economy, and doing so is essential if we want to see purchasing power recover and businesses regain the confidence to invest and create jobs. If we hesitate, we may later have to raise interest rates much higher, and keep them high for much longer, in order to get inflation down to its target of two per cent and to keep it there. With this I will conclude. Thank you for your attention, and I will be happy to answer any questions you might have. 7/8  BIS - Central bankers' speeches  1 ECB Economic Bulletin 7/2022 2 Bruegel: Does inflation hit the poor hardest everywhere?
Against the backdrop of a dramatic appreciation of the Swiss franc, the Swiss National Bank resorted mainly to interventions in the foreign exchange market, supplemented for a while by a minimum exchange rate for the Swiss franc against the euro. Since the discontinuation of this minimum exchange rate, the SNB has charged interest – known as negative interest – on the sight deposits of banks. The aim of all these measures has been to stabilise price developments and to support economic activity. The financial crisis has had the effect of generally raising the level of public interest in monetary issues – not least the question of how, given the strong expansion of liquidity, the interaction between central banks, banks and the public affects money and credit aggregates. 1 For obvious reasons, the financial crisis also spurred debate in the world of financial market regulation, with central banks and financial market supervisory authorities grappling with weaknesses exposed by the crisis. Their conclusions are reflected in the new international minimum requirements known as Basel III, as well as in supplementary national regulations. The most important adjustments include stricter capital requirements and the introduction of international liquidity standards for banks. Some radical proposals have also gained traction as a result of the crisis. In Switzerland, the sovereign money initiative attracted enough signatures to ensure a popular vote. The initiative demands that the creation of money and the granting of loans be separated by barring commercial banks from creating deposits through lending.