This textbook provides a comprehensive overview of monetary policy, banking supervision and financial stability in the euro area. The author uses his professional experience in central banking to provide a thorough understanding of European economics and to explore how the monetary and financial...

In inflation targeting (IT) regimes, the Monetary Authority announces an explicit objective, the target for inflation. However, other objectives that possibly conflict with the inflation goal are present, such as keeping output close to its potential level and the stability of financial markets....