While unlikely, an extreme scenario would see the entrenchment of disinflationary developments initiate a downward drift in the Phillips curve and unmoor inflation expectations. Empirically disentangling these factors is extremely difficult, so we need to be mindful of such considerations when discussing the relationship between economic slack and inflation developments, especially in an environment of uncertainty over the anchoring of inflation expectations. Our primary task as a central bank is to ensure that the reconnection of the real and the nominal sides of the economy – what I referred to before as the Phillips curve regularity eventually reasserting itself – occurs at a steady state rate of inflation that is consistent with our medium-term aim. We have not yet accomplished our mission, and so we must remain patient and persistent. In 2/3  BIS central bankers' speeches  light of this, the October monetary policy decisions were taken to preserve the favourable financing conditions that are still needed for a sustained return of inflation rates towards levels that are below, but close to, 2%. In particular, the recalibration of our asset purchases reflects growing confidence in the gradual convergence of inflation rates towards our inflation aim. 1 See, for example, the European Commission’s “European Economic Forecast – Autumn 2017”. 2 For more details, see the box entitled “The targeted longer-term refinancing operations: an overview of the take-  up and their impact on bank intermediation”, Economic Bulletin, Issue 3, ECB, 2017.
In sum, we are still far from completing the steps envisaged in the first phase of the Five Presidents’ roadmap. Achieving and maintaining responsible fiscal policies at national and euro area level still  3  seems beyond our grasp and while certain elements of the Banking Union are now in place, more needs to be done. Overall, the timetable is ambitious. We must also be realistic and admit that further integration is running against headwinds of popular discontent with integration and liberalisation. We need, therefore to be more open about what we are doing, to fully engage all our citizens and to build a case for a stronger EMU that can enjoy broad popular consensus rather than being imposed from above. 4