ECB Governing Council member Jozef Makuch said risks to the Eurozone are broadly balanced and the central bank’s stance was correct. He added policy makers were “not underestimating the risks” but “analyzing them”. And, “based on what we know now, the development is stable, risks are balanced, with some downside risks to GDP growth.” He also noted there is no reason to “spread gloomy mood or panic”.

Makuch also pointed out that Trump is like an “unguided missile” and the unpredictably of his policies is the biggest risks of the Eurozone economy. He noted that the erratic nature of Trump as “he says something and in the end something else happens”. Meanwhile, he played down risks from emerging markets and said the governing council sees no signs of spillover.

Meanwhile, Makuch is considering stepping down early as head of Slovakia’s central bank. He’s term supposedly end in 2021. He noted that the elections in spring 2020 would be highly divisive. That could lead to the post being vacant for an extended period. To him, Finance Minister Peter Kazimir would be a “good governor” to replace him. He hailed that Kazimir “Ecofin deals with all important monetary issues”, so the lack of experience in central banking is not a problem.

In the first speech as ECB President, Christine Lagarde urged Eurozone states to meet the common challenges with a “common response” of a “new European policy mix”. Monetary policy is the first element and ECB will “continue to support the economy and respond to future risks in line with our price stability mandate” and “continuously monitor the side effects”.

Another key element is fiscal policy which is “not just about the aggregate stance of public spending, but also its composition.”. Investment is a “particularly important part” of the responses. She added that public investment in the Eurozone remains “some way below its pre-crisis levels” and the share of “productive expenditure” also dropped. Both national policies and European programs like Invest EU has a “role to play.”

Also, “empowering our internal market also means completing our Economic and Monetary Union.” Completing EMU is about finding the right trade-off: enough protection against moral hazard to discourage under-saving, but enough mutual insurance to prevent over-saving.

Lagarde’s full speech here.

ECB Governing Council member Bostjan Vasle warned that “there are early signs that in parts of the economy and certain regions, the risk regarding the labour market could become more material.”

“In some parts of the economy, labour is in short supply and if this trend will continue, or spread to other sectors, it could pose a risk to inflation,” he said said. “That’s why I think we should be very careful about second round effects.”

He also said if the trends of economic recovery continue, ” then in next March it will be appropriate to end PEPP, as announced when the programme was implemented.” But he emphasized, “even when we decide to end it, we’ll continue to provide plenty of liquidity to the economy with our other instruments.”