• Discussions focused on contingencies and downside risks that may materialise
• One cause due to short term interest rate volatility not being transmitted along the yield curve
• So far EU area and markets have shown resilience
• Lack of contagion positive effect of ECB guidance
• Suspension of SMP sterilisation one instrument on the table
• Will depend on contingencies we face
• Not seeing deflation in Europe only low inflation for protracted period of time
• Inflation similar to US even though they have a much more advanced recovery
• Low inflation primarily driven by food and energy prices
• Must still be cautious with recovery which is fragile and uneven
• Spending still weak but consumer confidence is rising, savings rates have been stable
• There has been no pass through of vat increases in France and Italy