A monetary policy toolkit fit for purpose

Our mission is to make sure that inflation – the rate at which the prices of goods and services change over time – remains at 2% over the medium term. To do this, we use our monetary policy tools to influence what it costs to borrow money.

Our main tool is our set of key interest rates – also called “policy rates”. Beyond this, we can use additional tools, depending on what the situation calls for. These tools can either help reinforce our monetary policy stance or make sure financial markets work properly so that the effects of our monetary policy decisions are felt evenly across the euro area economy. If we need to, we can also develop new policy instruments, always making sure there’s a good balance between achieving results and keeping any side effects to a minimum. All of this ensures we are always equipped to respond to a changing and uncertain world.