Five months later, it turns out these words of the ECB President were very much prescient. Growth has slowed significantly for a host of reasons (slowdown of the global capex cycle, slower world trade growth, slower growth coming from China, country-specific factors in Germany, Italy and France, a prolonged period of pervasive uncertainty, etc.). As a consequence, labour market bottlenecks, whilst remaining tight, have eased. Moreover, growth of compensation per employee, which is still strong, has declined slightly, though it remains to be seen whether this is the beginning of a new trend. This provides a challenging environment to generate the necessary pass-through from wages to inflation so as to have the latter converging to the ECB’s policy objective. This is confirmed by the latest inflation data with core HICP up 0.8% in March versus last year. There is something tragic in the observation that the combination of an imported growth slowdown and imported uncertainty shocks have shortened the phase of very strong growth in the eurozone and triggered a premature slowdown. This in turn has reduced the effectiveness of an expansionary monetary policy, leaving the ECB no choice but to start working on more of the same. The details on the new TLTRO are eagerly awaited.