See ECB (2021), “An overview of the ECB’s monetary policy strategy”, July. 6. These include global supply chain disruptions, zero-COVID policies, production cuts by oil exporting countries and the effects of the war in Ukraine on energy and commodity prices. 7. Panetta, F. (2022), “Mind the step: calibrating monetary policy in a volatile environment”, speech at the ECB Money Market Conference, Frankfurt am Main, 3 November, Chart 2. 8. Rees, D. and Rungcharoenkitkul, P. (2021), “Bottlenecks: causes and macroeconomic implications”, BIS Bulletin, No 48, 11 November. 9. In the second quarter of 2022, 0.7% of the euro area labour force was still enrolled in such schemes. 10. Consolo, A. and Dias da Silva, A. (2022), “The role of public employment during the COVID-19 crisis”, Economic Bulletin, Issue 6, ECB. 11. ECB (2022), ECB staff macroeconomic projections for the euro area, September. 12. Rudebusch, G. (2016), “Will the Economic Recovery Die of Old Age?”, FRBSF Economic Letter, No 201603, Federal Reserve Bank of San Francisco, 4 February. 13. For instance, the European Commission’s Autumn 2022 European Economic Forecast published on 11 November 2022 foresees that the output gap in the euro area closes in 2022 but turns negative again in 2023 and does not fully close in 2024. 14. For instance potential output level estimates for 2022, 2023 and 2024 were revised down in the European Commission’s Autumn 2022 European Economic Forecast compared to the Autumn 2021 European Economic Forecast (by 0.9%, 1.3% and 1.5% respectively) but remain higher compared to the Autumn 2020 European Economic Forecast.
2002, No 2, and Beyer, A., Gaspar, V., Gerberding, C. and Issing, O. (2009), “Opting out of the Great Inflation: German monetary policy after the break down of Bretton Woods”, Working Paper Series, No 1020, ECB, March. 26. ECB staff estimates find that the change in market pricing of the short-to-medium term interest rates and in survey evidence of Eurosystem balance sheet expectations between December 2021 and the assumptions implied in the September 2022 ECB staff projections would on average subtract around 1 percentage point from annual real GDP growth each year until 2024 (i.e. annual real GDP growth is estimated to be reduced by around one percentage point on average in 2022, 2023 and 2024). Since the September 2022 ECB staff projections, tightening expectations have further increased, implying a further impact on GDP growth. The estimated impact refers to the average across a set of models used by the ECB for policy simulations, including the NAWM-II model (Coenen, G., Karadi, P., Schmidt, S. and Warne, A. (2018), “The New Area-Wide Model II: an extended version of the ECB’s micro-founded model for forecasting and policy analysis with a financial sector“, Working Paper Series, No 2200, ECB, November (revised December 2019)), the ECB-BASE model (Angelini, E., Bokan, N., Christoffel, K., Ciccarelli, M. and Zimic, S. (2019), “Introducing ECB-BASE: The blueprint of the new ECB semi-structural model for the euro area”, Working Paper Series, No 2315, ECB, September) and the MMR model (Mazelis, F., Motto, R. and Ristiniemi, A.