June 1, 1998 European Central Bank prepare an introduction Euro – the world’s largest currency transition. I was a lawyer at the time and remember how we worked at a furious pace, renegotiating contracts based on exchange rates that would soon cease to exist. Can a single currency really work? Today, on the 25th anniversary of this institution, we know that the euro works and what it has brought Europe closer.

Our staff in Frankfurt, mandated by the eurozone governments to defend the euro, work tirelessly with colleagues from the 20 eurozone national central banks to fulfill our mission: to maintain price stability. This mission is vital to the well-being of European citizens.

Over the past 25 years, we have welcomed nine new countries to the eurozone, and now we have 20 members instead of 11. And we have taken on new tasks, such as the supervision of European banks. Today, the euro is the second most important currency in the international monetary system after the US dollar.

Of course, there were difficult moments along the way. In the periods of both positive and negative economic developments that my predecessors Wim Duesenberg, Jean-Claude Trichet and Mario Draghi faced, the ECB has always sought to build a stronger foundation for Europe’s future by fulfilling its mandate.

The pandemic and Russia’s unjustified war against Ukraine have shown that stability cannot be taken for granted. Growing geopolitical rivalry could mean more volatility in the global economy going forward. In a world of uncertainty, the ECB has been and remains a reliable and stable reference.

We have proven that we can act and quickly adapt even to the most serious challenges. Just a few months after I took over as President of the ECB, we immediately responded to the pandemic. In the acute phase, we took a number of measures to support the eurozone economy, avoiding the risk of deflation.

Today we are acting with the same determination to bring inflation down. After having been extremely low for many years, inflation is now at very high levels and is expected to remain so for a very long time. Inflation undermines the value of money, reduces purchasing power and harms citizens and businesses across the euro area, especially the most vulnerable in our society.

However, we will bring inflation back to our target of 2% over the medium term. That is why we have raised interest rates at an unprecedented pace, and why we will set them at a sufficiently restrictive level – and keep it there for as long as necessary – in order to bring inflation back to our target in time.

As recent developments in the banking sector remind us, the mission of monetary policy is helped by a sound banking system. Financial stability is a precondition for price stability and vice versa. Since we took over banking supervision in 2014, we have been working to ensure the soundness of banks in the euro area. Our supervisors, chaired by Andrea Enria, will continue efforts to ensure that banks are sufficiently capitalized and resilient to changing conditions so that they can continue lending to businesses and households.

Our monetary union has been tested many times over the past 25 years. We have faced crises that could tear us apart, including the Great Financial Crisis, the sovereign debt crisis and the pandemic. But we emerge stronger from every crisis. Now we must use this inner strength.

As the world becomes increasingly unpredictable, Europe can build resilience on two fronts. On the one hand, by integrating capital markets, Europe can better facilitate investment in the green economy and digital transformation sectors that are so important to its future growth. On the other hand, with the completion of the banking union, we can ensure that the banking sector will do its part so that in future crises, risks do not increase, but decrease.

As former President of the European Parliament Simone Veig once said, “We need a Europe capable of solidarity, independence and cooperation.” This phrase accurately reflects what the euro stands for. After all, the euro is more than a currency. It is the strongest form of European integration, representing a united Europe working together to protect and benefit all of its citizens.

The ECB will always be the cornerstone of these efforts.

* Christine Lagarde is President of the European Central Bank.