Monetary policy issues for the Eurosystem

The paper discusses the choice between inflation targeting and monetary targeting for the Eurosystem, the announced Eurosystem strategy, the appropriate framework for policy decisions, exchange rate management in the EMU, and Eurosystem accountability and transparency. The announced monetary strategy is deficient, since it proposes a prominent role for an essentially irrelevant money-growth indicator in analysis and communication, but will keep secret the inflation forecast that will, in practice, be the decisive input in policy decisions. Effective outside monitoring and evaluation of Eurosystem policy decisions seem to require published inflation forecasts and Governing Council minutes and voting records.