It should be remembered that one of the main reasons for the simplification of central bank targets in recent years, and for assigning them the main objective of price stability, is that inflation is primarily a monetary phenomenon and the long-term impact of monetary policy is above all on prices. Its impact on economic growth and employment is therefore generally only temporary. Since central banks broadly speaking have only one instrument, i.e. interest rates, and can therefore only achieve a single long-term macroeconomic goal, it is natural to set price stability as the ultimate monetary goal. This is not to say that price stability is a more important goal than, say, full employment, but simply that monetary policy instruments are inherently better suited to impacting prices. It is pointless to set objectives for monetary policy which it cannot achieve. Through price stability, a forward-orientated monetary policy can contribute towards creating a stable economic environment on which the long-term growth potential of the economy is based. From the above it is clear that the Central Bank’s main task is to achieve the inflation target, and this is what it aims to do. There have been vocal calls recently for the Central Bank to ease its monetary stance in order to soften or even prevent a looming economic contraction. The growth outlook has an impact on the output gap, i.e. the deviation in demand from a level which is consistent with balanced supply and demand for domestic goods and factors of production.
3/ How can we give further impetus to Europe? Getting back to the European level, I would like to point out that many improvements have also been made in the field of crisis prevention and management. Prevention is based on much more 2/3  BIS central bankers' speeches  efficient financial regulation and on a European governance framework that is better organised now with well-designed monitoring mechanisms on fiscal performance as well as on macroeconomic imbalances and structural reforms. Banking Union contributes to strengthening financial stability in the euro area and the EU as a whole and to ensuring that the banking sector is safe and reliable. The global European picture is of substantially enhanced resilience since the crisis. The Common Equity Tier 1 ratios of significant banking groups in the euro area have risen from 7% in 2008 to 14% today. Crisis management – including for Greece – has also evolved considerably with the creation of the ESM. So you can be fully confident about the resilience of the euro and of the euro area. It is not only an economic asset, it is also a political one, supported by each of the 19 governments and – which is still more important – by 68% of euro area citizens (and even by 70% of French citizens and 73% of German citizens). Moreover, monetary policy played its full part to maintain euro area cohesion. Europe has clearly succeeded with monetary union, but monetary policy should not remain the only game in town.