ECB: The conflict of objectives between monetary policy and banking supervision

The side of the ECB that conducts monetary policy has decided to cut interest rates even further and to resume quantitative easing, because growth in the euro zone is slowing and because inflation remains below-target. But this raises a problem for the side of the ECB that supervises banks: Because banks in the euro zone are going to continue to be weakened by the very low interest rates; Because in some countries (France, Germany), the very low interest rates are leading to what is deemed to be excessively rapid growth in lending. There is therefore clearly a conflict between the side of the ECB that conducts monetary policy and the side of it that supervises banks . This demonstrates the need to coordinate monetary policy and banking supervision.