LET'S just review the brutal facts: • The economy of the euro area has been in recession since the third quarter of 2011.

• The euro-area unemployment rate is at a record-high 12%, up more than two percentage points from 2011.

• Year-on-year inflation is falling and is now down to 1.7%. Monthly inflation rates are flat to falling across most of the euro area.

• The latest data indicate that recession continued through the first quarter and may have been deepening as of March.

The European Central Bank has a price stability mandate, and so, superficially, it doesn't have to care about a terrible performance on output or employment. In reality, of course, terrible performances on output and employment feed into falling inflation. One would think that the ECB would be worried about the possibility that inflation may soon slip well below its target.

And yet the ECB may feel that it has done all it can do. Its policy rate, at 0.75%, is above those of most other central banks. But as Mario Draghi noted in his post-meeting remarks today, a low ECB policy rate has failed to bring down borrowing rates for businesses around the periphery, which are significantly above those in Germany and France. These gaps will hardly be improved by recent experience in Cyprus, after which officials strongly hinted that uninsured depositors could expect to take losses when banks run into trouble ("not smart", Mr Draghi labeled the messaging). That provides a strong incentive for peripheral depositors to shift funds elsewhere, reducing the supply of loanable funds and raising borrowing costs.

Faced with somewhat similar breakdowns in transmission of monetary policy, the Bank of England and Federal Reserve have opted to experiment with bold new asset-purchase programmes. The Federal Reserve is buying assets both to increase the overall expansionary stance of monetary policy and to specifically improve the still-impaired flow of credit to housing markets. The Bank of England is also buying assets, and experimenting with efforts to improve the flow of credit to businesses.

The ECB is doing none of this. Despite wretched data, the ECB opted not to cut its policy rate this week (while hinting it may do so down the road). Neither did it deploy a broad asset-purchase programme designed to make the overall stance of policy more stimulative. And while it acknowledged that improved funding conditions around the periphery would be highly desirable, it reckoned that it did what it was able to do on that front when it intervened forcefully in 2011 and 2012 to keep sovereign borrowing costs from spiraling out of control and banking systems from imploding. The ball is now in governments' court, Mr Draghi noted this morning; leaders must move forward on a banking union.

A banking union would certainly help, and it is unfortunate that progress on institutional deepening within the euro zone has stalled out since 2012. No one can deny that the ECB, lacking a unified government to back it fiscally or authoritatively, is in a much trickier position than other major central banks. Yet that is no excuse for the ECB's inaction. It is well within the ECB's monetary-policy purview to address the dangerous gap in borrowing costs between core and periphery. Asset purchases surely make some ECB policymakers nervous, especially Jens Weidmann and his colleagues at the Bundesbank. And the policies that would be most effective—targeted purchases of asset-backed securities from peripheral economies—may look too much like a bail-out, or coddling of reform-averse southern politicians, to win acceptance.

But the alternative is an ECB no longer in the business of making monetary policy. Instead, the ECB's main preoccupation has become the playing of chicken with governments. To the periphery it offers a deal: adopt the policies we want and we won't allow your financial systems to collapse. To everyone else it says: expect recession to continue until institutional reform is revived.

It may feel as though it has no choice in the matter. But to those governments weighing up the costs and benefits of continued euro-zone membership, the prospect of a permanent relationship with a central bank uninterested in making monetary policy is not going to look especially attractive. Some institution, somewhere, needs to demonstrate some interest in making the euro area look like a good, long-run deal for struggling economies. Otherwise it will become a failed-marriage of a single currency, with all members waiting and hoping for some excuse to get out.