On the fiscal front, the consolidation process has paused somewhat and, according to the Spring-2016 European Commission’s forecasts “fiscal policy is expected to be slightly supportive to growth this year”. There are also important political challenges ahead. The management of the flow of refugees, the referendum that the United Kingdom will hold next month on its EU membership, and, more recently, the negotiations with the United States to sign the Transatlantic Trade and Investment Partnership (TTIP) are leading sometimes to heated debates on the institutional framework of the EU. In connection with these, and other, challenges, I would like to recall the roadmap drawn up in the Five Presidents’ Report published last year, which delineates steps for further economic integration within the euro area through both real convergence and some mutualisation of risks. Making progress along the lines suggested in the Five President’s Report would not only improve the resilience of the euro area to future shocks, but would help building up the necessary confidence to create employment and lifting growth potential. Monetary policy I would like now to make a few comments on the main features of our monetary policy scenario. Since the beginning of the crisis weak domestic demand in the euro area has pushed down core inflation well below the medium-term objective. The subsequent fall in oil prices has 2  BIS central bankers’ speeches  aggravated this situation and core prices have grown in the last years at very moderate rates, around 1 % or less.
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