The Euro Caught Between Crickets and Crows

Defending the value of the euro is a necessary, albeit not sufficient, condition to have healthy and regular growth. But in order to defend the euro, the credibility and effectiveness of the ECB must not me tarnished, by modifying its institutional mandate, which would adversely and irreversibly affect its independence.
The ECB has thus far managed a difficult act: it has dealt with an extraordinary financial situation by using all the conventional and non-conventional weapons at the disposal of a central bank committed to monetary stability. This has been done through the managing of interest rates and thus of inflationary expectations. By reducing uncertainty, this gives a decisive contribution to economic growth: investors and firms need to be able to trust the value of the currency in order to make their saving and spending decisions.
Inflation is under control, this we can safely say about the euro. At the same time, the ECB has managed liquidity to reduce the risk of financial instability. The European banking system has been strengthened by larger reserve requirements. This is a particularly precious resource in times of financial tensions (including the harmful requests for the recapitalization of banks made by the EBA, the European supervision authority) that have not abated.
The success of ECB policy is all the more relevant, if one considers that the central bank is being pressured from two sides: inflationary crickets on one side, deflationary crows on the other. Inflationary crickets usually chirp in French and are lobbying for a reform of the Maastricht Treaty, so that they can have a central bank deprived of specific objectives, or at least having more than one objective (just like the Fed; what is sought is a central bank without binding priorities). Too bad that discretionality in central banking goes hand in hand with subordination of monetary policy to the myopic interests of incumbent governments, which would like to use it to sweep under the carpet, at least temporarily, the structural problems causing unemployment and government deficits. The toxic marriage between subordinated central bankers and short-sighted politicians is a constant of economic history, and the latest US financial crisis is no exception. But the crickets were too busy chirping to care.
On the other side there are deflationary crows, who caw in German, and say that the ECB is implementing the wrong policy by being too expansionary, which sooner or later will lead to higher inflation. But there is no automatic connection between the current policy of refinancing the banking sector and the ECB's future ability to control inflation. The ECB has been using interest rates as tools to control price dynamics. The same tool has effects on banks' liquidity. The current course of monetary policy does not preclude the possibility of a more restrictive stance in the future. The important thing is that Draghi will be able to acknowledge when is the right moment to change policy course: for the good of the euro, in spite of crickets and crows.