 So, welcome everybody to this ECB Cleveland Fed Conference on inflation, driver and dynamics. So I think Christiane is right. This is a good time to talk about inflation. And so this is also what I'm going to do in my introductory remarks. So as you know, Euro area headline inflation has reached 3.4 percent in September, according to the most recent flash estimate, which is its highest annual rate in more than a decade and notably above the ECB's new symmetric target of 2 percent to be attained over the medium term. The recent rise in inflation has intensified the debate about the most likely future evolution of price pressures. And this stands in sharp contrast to the developments over the past decade when structural headwinds prevented inflation from converging towards our target. The timing of this conference on inflation drivers and dynamics could therefore hardly be more fitting. I will begin my remarks by discussing how the current spike in inflation can in large part be attributed to temporary pandemic related factors that are likely to dissipate in the medium term. Then I will elaborate on the headwinds and tailwinds that may contribute to the evolution of inflation over the medium term, linking them to research that will be presented at this conference. And there is actually a somewhat longer version of this speech, which you will find on the web. This will also explain the title of the speech. Unfortunately, I only have 15 minutes, so I won't be able to explain that. So over most of the past decade, inflation has persistently fallen short of the ECB's inflation aim. Both headline and co-inflation averaged only around one percent, as you can see on this slide. Moreover, inflation repeatedly surprised on the downside relative to our in-house staff projections before the pandemic. Subdue to inflation dynamics were driven by cyclical and structural factors, which created sustained headwinds for underlying price pressures. The pandemic has added short-term disruptions to these longer-term trends. Initially, inflation declined substantially in 2020, with rates temporarily entering negative territory. Much of that decline was attributable to specific pandemic-related temporary factors, including a substantial decline in commodity prices and the temporary cut in the German VAT rates. With the onset of the recovery, inflation picked up rapidly. In fact, the current spike in inflation owes much to the continued impact of those same factors that pushed down inflation earlier. More than half of measured headline inflation in the euro area is currently due to rising energy prices and to the reversal of the German VAT cut, as can be seen on this slide. Two further pandemic-related factors are also having a temporary, if somewhat more durable, impact on inflation. First, continued supply chain disruptions are pushing up produced prices due to supply and demand imbalances, thus feeding into non-energy industrial goods inflation, which has been exceptionally strong recently, as you can see on this slide on the left-hand side. Second, the reopening of the economy has pushed up services inflation, in particular in high-contact sectors, as seen on the right-hand chart. Even though these pandemic-related developments are currently dominating media headlines, prices are high that above-target inflationary pressures will subside over time. In our baseline projections, headline inflation is forecast to fall back below our medium-term inflation target of 2% in the medium-term, as shown on this slide. However, it would be premature to assert that current price dynamics will fully subside next year. There are various sources of uncertainty that might entail more persistent inflationary pressures. It is also possible that the pandemic has altered a reinforced structural trend, thus affecting inflation dynamics in the years to come. Against the background of the research contributions presented at this conference, I would like to highlight two types of uncertainty that will determine whether current inflationary trends will turn out to be more persistent. First, the current uptick in inflation might result in a more enduring upward revision of inflation expectations. And second, the pandemic may have triggered behavioral changes that alter rigidity at microeconomic levels, such as wage and price stickiness, having an impact on the slope of the Phillips curve. Let me begin with inflation expectations. The standard prescription for monetary policy is to look through temporary supply-side shocks and to only take policy action if inflation expectations and wage bargaining give rise to second round effects posing a threat to price stability. The difficulty with this prescription is that aggregate inflation expectations are unobservable. One method is to use market-based measures of inflation compensation. Immediately prior to the pandemic, market-based medium-term inflation expectations shown on the left-hand slide stood at only 1.1%, substantially below our medium-term inflation target. With the onset of the pandemic, they declined to nearly 0.5% in March 2020. Thus, the recent increase in market-based inflation expectations to levels closer to our target is a welcome development. It signals that investors have become more sanguine about the euro area inflation outlook without pointing so far to fears of more persistent inflation overshoots. And since inflation expectations help to determine the real interest rates, higher inflation expectations reinforce the degree of policy accommodation in an environment of low nominal yields and thus contribute to lifting inflation towards our new symmetric medium-term target of 2%. Similar to market-based measures, survey-based measures of inflation expectations also shown on the left-hand side have exhibited a notable upward lift in the wake of the recovery from the pandemic, but they also remain below our target. In other words, there is currently no indication that elevated inflation rates are becoming entrenched in medium- and longer-term inflation expectations in the euro area, entailing risks for price stability. On the contrary, recent developments across indicators suggest that investors and professional forecasters are increasingly internalizing our new monetary policy strategy, as well as our recently revised forward guidance bringing us closer to our inflation target. In an environment of measurable movements in inflation expectations, insights regarding their role in monetary policy transmission remain crucial for central banks. In the post-pandemic context, it is particularly relevant whether changes in measures of expectations indicate a more fundamental change that may durably impact the transmission of our monetary policy. So how reliable are surveys of professional forecasters, for example? One of the conference papers identifies an intriguing mechanism whereby even rational forecasters might report a biased measure of their true expectations, with individual forecasts overreacting to private information, while underreacting to public information. Moreover, aggregating inflation expectations can be misleading. Probability distributions of inflation expectations derived from option prices, shown on the right-hand side, show a clear shift in recent months. Following a long period of market-based distributions of inflation expectations being skewed to the downside, the probability of option-implied inflation rates above 2 percent over the next five years has recently reached its highest level since 2012 at 40 percent. Such distributions are likely to matter even more in the case of households and businesses who often let accurate knowledge of the official inflation rate or the central bank's inflation target, resulting in a wide distribution of inflation expectations. Indeed, new survey evidence in one of the conference papers confirms that inflation expectations of U.S. firms are far from anchored. For central banks, these findings highlight the importance of communicating our monetary policy objectives effectively. One conference paper addresses this issue by showing that central bank communication focusing on the goals of monetary policy actions is more effective than communication focusing on monetary policy instruments. The second source of uncertainty that I would like to discuss today relates to potential behavioral changes induced by the pandemic. Microeconomic rigidities, such as those stemming from wage and price-setting behavior, have profound implications for the transmission of monetary policy because they affect the location and the slope of the Phillips curve. Model simulations and recent empirical evidence indicate that the slope of the Phillips curve may have flattened considerably over recent decades, a finding that continues to generate substantial debate in academia and in policy circles. Such a change would have significant implications for the conduct of monetary policy. However, like inflation expectations, the slope of the Phillips curve is not directly observable and estimates differ depending on the models used. Research presented at this conference suggests that one has to be careful in order to avoid confusing a changing slope of the Phillips curve with a shift in inflation expectations. A further key structural determinant of the slope of the Phillips curve is the rate at which firms reset prices, affecting the responsiveness of the price level to changes in economic activity. Some have argued that low inflation rates have reduced the rate of price resets, since firms are less likely to find themselves significantly away from their optimal price. However, research conducted by the ECB and the Prisma Network on micro-level price data challenges this claim, finding no noticeable slowdown in the rate of price resets shown on this slide. This research is representative of a wider shift in the literature, which increasingly investigates the macroeconomic impact of heterogeneous firm-level decisions. This growing evidence, for example, that the aggregate change in the price level is not only determined by the average rate of price resets, but rather by the entire distribution of price adjustments. One conference paper written under the Prisma Network finds evidence that the probability of price changes indeed depends on the extent of mispricing both for the United States and for the Euro area, as indicated by the V-shape on this slide. Firms further away from the optimal reset price are indeed more likely to change prices. However, the paper also shows that the probability of adjustment in response to monetary and credit shocks does not depend on the extent of mispricing. Hence, the paper finds little evidence that selection contributes significantly to the overall inflation response to an aggregate shock. From a policymaker's perspective, such findings generate constructive input for our policy discussions on the transmission of monetary policy. So let me conclude. Current inflationary pressures in the Euro area are driven by pandemic-related factors that can be expected to largely fade out over the course of next year. Overreacting to such short-term volatility would be harmful and risk jeopardizing the ongoing economic recovery, which is why the ECB's monetary policy remains focused on fulfilling its medium-term price stability mandate. Nonetheless, significant uncertainty remains as to how persistent some of the current price pressures will prove to be. The ECB therefore continues to carefully monitor inflationary developments in the Euro area with a particular focus on second-round effects. The cyclical and specific pandemic factors will increasingly be overlaid by structural changes. Structural factors such as globalization, the fight against climate change, demographic trends, and digitalization are likely to continue to affect prices and price setting and hence the transmission of our monetary policy, but the direction is still unclear. High-quality academic research into the underlying drivers of inflation dynamics hence remains a vital input for our monetary policy deliberations. I therefore very much look forward to hearing more about the insightful papers and novel research findings that will be presented at this conference. Thank you very much for the organizers for having me to give these introductory remarks and for setting up such a fascinating and interesting program. I wish you a very good conference. Thank you.