Philip R. Lane: Opening remarks

It is beyond the scope of these opening remarks to review last week’s monetary policy meetings. However, a set of background slides are available on the ECB’s website.

For instance, see Ferrando, A. and Forti Grazzini, C. (2023), “Monetary policy shocks and firms’ bank loan expectations”, Working Paper Series, No 2838, ECB; Banbura, M., Bobeica, E. and Martínez Hernández, C. (2023), “What drives core inflation? The role of supply shocks”, Working Paper Series, No 2875.

In the euro area, households in the bottom income quintile spend about 50% of their total expenditure on rent, food and utilities, double the expenditure share for households in the top income quintile. See Bobasu, A., di Nino, V. and Osbat, C. (2023), “The impact of the recent inflation surge across households”, Economic Bulletin, Issue 3, ECB.

Battistini, N. and Gareis, J. (2024), “Sectoral dynamics and the business cycle in the euro area”, Economic Bulletin, Issue 4, ECB. The role of production networks in monetary policy transmission is also a topic in the European System of Central Banks ChaMP research network (“Challenges for Monetary Policy Transmission in a Changing World”). The network is also working on extending detailed business-to-business production network data to several more euro area countries.

For instance, see Bobasu, A., Dobrew, M. and Repele, A. (2024), “Energy price shocks, monetary policy and inequality” (forthcoming in the ECB’s Working Paper Series); Ciccarelli, M., Darracq Pariès, M., Priftis, R. (eds) (2024): ECB macroeconometric models for forecasting and policy analysis, Occasional Paper Series, No 344.

Regarding the Corporate Telephone Survey, see Healy, P., Kuik, F., Morris, R. and Slavík, M. (2024), “Main findings from the ECB’s recent contacts with non-financial companies”, Economic Bulletin, Issue 3, ECB. Regarding the Consumer Expectations Surveys, see Bobasu, A., Charalampakis, E. and Kouvavas, O. (2024), “How have households adjusted their spending and saving behaviour to cope with high inflation?”, Economic Bulletin, Issue 2, ECB; Kouvavas, O. and Rusinova, D. (2024), “How big is the household housing burden? Evidence from the ECB Consumer Expectations Survey”, Economic Bulletin, Issue 3, ECB; Georgarakos, D., Kouvavas, O., Meyler, A. and Neves, P. (2023), “What do consumers think is the main driver of recent inflation?”, Economic Bulletin, Issue 6, ECB; Kouvavas, O. and Tsiortas, A. (2024), “Consumer credit: Who’s applying for loans now?”, The ECB Blog, 15 May.

This dataset will be introduced to the public, along with its main features and use cases, in a contribution entitled “Introducing the Distributional Wealth Accounts for euro area households” in the forthcoming issue of the ECB’s Economic Bulletin in August 2024.

See Gornicka, L. and G. Koester (eds.) (2024): A forward-looking tracker of negotiated wages in the euro area”, Occasional Paper Series, No 338; ECB; Bing, M., Holton, S., Koester, G. and Llevadot, M.R.I. (2024), “Tracking euro area wages in exceptional times”, The ECB Blog, 23 May, and Ampudia, M. Lombardi, M. J. and Renault, T. (2024), "The wage-price pass-through across sectors: evidence from the euro area," Working Paper Series, No 2948, ECB.

Dedola, L., Henkel, L., Höynck, C., Osbat, C., Santoro, S. (2024), "What does new micro price evidence tell us about inflation dynamics and monetary policy transmission?," Economic Bulletin, Issue 3, ECB.

Baumann, U., Ferrando, A., Georgarakos, D., Gorodnichenko, Y. and Reinelt, T. (2024), “SAFE to update inflation expectations? New survey evidence on euro area firms”, Working Paper Series, No 2949, ECB, June; Durante, E., Ferrando, A. and Vermeulen, P. (2022), “Monetary policy, investment and firm heterogeneity”, European Economic Review, Vol. 148, September.

Altavilla, C., Burlon, L., Holton, S., and Giannetti M., (2022) Is there a zero lower bound? The effects of negative policy rates on banks and firms, Journal of Financial Economics, Vol. 144, No 3, June, pp. 885-907; Holton, S. and Rodriguez d’Acri, C. (2018), “Interest rate pass-through since the euro area crisis”, Journal of Banking & Finance, Vol. 96, November, pp. 277-291; Altavilla, C., Canova, F. and Ciccarelli, M. (2020), “Mending the broken link: Heterogeneous bank lending rates and monetary policy pass-through”, Journal of Monetary Economics, Vol. 110, April, pp. 81-98; Albertazzi, U., Burlon, L., Jankauskas, T. and Pavanini, N. (2022), “The Shadow Value of Unconventional Monetary Policy”, CEPR Discussion Paper, No 17053, 20 February; Altavilla, C., Boucinha, M. and Peydró, J.-L. (2018), “Monetary policy and bank profitability in a low interest rate environment”, Economic Policy, Vol. 33, No 96, pp. 531-586. And the ESCB ChaMP network is further deepening this type of analysis, exploiting for example the European AnaCredit database and national credit registers.

Altavilla, C., Boucinha, M., Holton, S. and Ongena, S. (2021), “Credit Supply and Demand in Unconventional Times”, Journal of Money, Credit and Banking, Vol. 53, No 8, December, pp. 2071-2098; Faccia, D., Hünnekes, F. and Köhler-Ulbrich, P. (2024), “What drives banks’ credit standards? An analysis based on a large bank-firm panel”, Working Paper Series, No 2902, ECB, February.

Amador, S. and Elfsbacka-Schmöller, M. (2024): “Monetary Policy, Growth, and Sectoral Reallocation”, mimeo.

Albertazzi, U., Becker, B. and Boucinha, M. (2021), “Portfolio rebalancing and the transmission of large-scale asset purchase programs: Evidence from the Euro area”, Journal of Financial Intermediation, Vol. 48, October; Koijen, R.S.J., Koulischer, F., Nguyen, B. and Yogo, M. (2017), “Euro-Area Quantitative Easing and Portfolio Rebalancing”, American Economic Review, Vol. 107, No 5, pp. 621-627; Altavilla, C., Gürkaynak, R. and Quaedvlieg, R. (2024), “Macro and Micro of External Finance Premium and Monetary Policy Transmission”, Journal of Monetary Economics, forthcoming; Barbiero, F., Burlon, L., Dimou, M. and Toczynski, J. (2024), “Targeted monetary policy, dual rates and bank risk taking”, European Economic Review, forthcoming; Altavilla, C., Laeven, L. and Peydró, J.-L. (2020), “Monetary and Macroprudential Policy Complementarities: evidence from European credit registers”, CEPR Discussion Paper, No 15539, 11 December; Battistini, N., Falagiarda, M., Hackmann, A. and Roma, M. (2022), “Navigating the housing channel of monetary policy across euro area regions”, Working Paper Series, No 2752, ECB, November.