La nueva política monetaria del eurosistema

La nueva política monetaria del eurosistema

Fecha: mayo 2000

Eugenio Domingo Solans, Alicia García Herrero

Papeles de Economía Española, N.º 84-85 (2000)

This article describes the four coordinates of the Eurosystem monetary policy -its aim, its strategy, the operating framework and the approach- bearing in mind the essential features denoting the monetary policy of the euro area with regard to any other country’s or region’s. These characteristic features are the principal novelty of this policy, as it has been in operation for just over a year, the relative heterogeneity of the area to which it is applied, and the uncertainty that inevitably accompanies everything new and heterogeneous.The prime aim of the Eurosystem monetary policy is price stability and without prejudice to this, indirectly and conditionally, economic growth and employment. Exchange rate stability is not a specific objective of the EGB but rather a condition, an ingredient, along with others, so that price stability is maintened.The strategy chosen to achieve this objective is genuine -consisting of two pillars, one monetary and the other forecasts of inflation- so that it may be more flexible towards the novelty and uncertainty accompanying the monetary policy of the Eurosystem. The operational framework -based on open market operations, mainly weekly auctions for injections of liquidity with repos, two permanent facilities, one loan and the other deposit, and a liquidity reserve ratio remunerated at market rate- is characterized by its flexibility and by interest rate control in spite of the fact that there is no operating goal for shortterm rates. Lastly, the main features of the Eurosystem monetary policy approach are the medium term, passiveness, discretion and global European outlook.Although the aim, strategy, operational framework and approach of the European monetary policy have proved to function perfectly, at least so far, there are still major challenges to be met by the Eurosystem in the coming years. The first of theseis to go on implementing a single monetary policy forthe eleven different countries from not only the political and social, but also the economic standpoint. The second challenge is the ultimate integration of the European financial markets. The third, connected with the first, is greater interaction of macroeconomic policies. The fourth challenge is to make fourther advances towards structural reforms and reduction of unemployment. The final challenge is to integrate new countries into the euro area, beginning with those already forming part of the European Union, and continuing with the countries that join in the future.

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