2023-05-29 21:38:14
The ECB has had to deal with several severe crises: 2007-2008 financial crisis, eurozone crisis, pandemic crisis. It first drew on its traditional instruments, in particular by sharply lowering interest rates, in order to fight against the decline in activity and the risk of deflation. With rates close to zero and the continuation of the crises, it mobilized “non-standard” instruments.
Since its creation, the ECB has been able to maintain monetary union and contain inflation at relatively low levels. But, since the post-pandemic recovery and the energy crisis due to the war in Ukraine, inflation recorded a peak of 10% in November 2022.
The ECB has also broadened its power because, since 2014, it has ensured the supervision of banks by the Single Supervisory Mechanism (SSM). This asks about the limits of his mandate. Likewise, the “non-standard” instruments question its independence, both vis-à-vis national fiscal policies and vis-à-vis developments in financial markets.
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