Government policy on public health, in the face of the most extreme pandemic for at least a century, led to deliberate lockdowns. Much of economic activity simply ceased. The important question we faced as monetary policymakers was what would happen when the restrictions were lifted as Covid abated. Would a synchronous and equivalent fall in demand and supply simply be followed by a synchronous and equivalent rise? At the time, I remember being asked quite often if the pandemic would leave scars on the economy: would there be any lasting damage to the economy? Bank of England  Page 14  As put, the question was about whether firms would be able to survive the prolonged economic impact of the pandemic, let alone continue to invest in the future – or whether millions would be driven into unemployment as the Government furlough scheme, which remunerated those whose jobs were in effect suspended, was set to end at the end of September 2021. This was by no means clear at the time. The furlough scheme was unprecedented and had been operating for 1½ years, and even firms were unsure of what the effects on recruitment would be, as they reported to the Bank’s Agents at the time. A key consideration for policy, therefore, was to ensure that supply would come back on stream, and for monetary policy in particular to ensure that there was sufficient demand in the economy to pick it up. What actually happened was quite different from what we had feared.
European Central Bank: Press conference - introductory statement Introductory statement by Mr Jean-Claude Trichet, President of the European Central Bank, and Mr Lucas Papademos, Vice-President of the European Central Bank, at the press conference held in Frankfurt, 1 April 2004. *  *  *  Ladies and gentlemen, welcome again to our press conference. Before I proceed, I would like to remind you that I have conveyed the Governing Council’s sincere condolences to Jaime Caruana, Governor of the Banco de España, following the terrorist attacks in Madrid on 11 March 2004. I assured him of the Governing Council’s total solidarity with the Spanish people and the Banco de España. The Vice-President and I will now report on the outcome of today’s meeting of the Governing Council of the ECB. On the basis of our regular economic and monetary analysis, we have not changed our assessment that the current stance of monetary policy remains in line with the maintenance of price stability over the medium term. Accordingly, the key ECB interest rates have been left unchanged. The low level of interest rates also provides ongoing support to the economic recovery in the euro area. We will continue to monitor carefully all developments that could affect our assessment of risks to price stability over the medium term. Let me now provide a more detailed explanation of our decision, turning first to the economic analysis.