this outlook remain balanced. over longer horizons, the uncertainties continue to be related to persistent external imbalances in some regions of the world and their potential repercussions on the sustainability of global economic growth. this is a challenge to be addressed by sustainable macroeconomic policies and structural reforms which foster a sound balance between savings and investment in all major partner countries, enhance the production potential in the euro area and support a further expansion in trade of goods and services at the global level. with regard to price developments, hicp inflation rates over the short term are still expected to fluctuate around the 2 % level, following a rate of 2. 1 % in december, according to eurostat's flash estimate. as i have explained on previous occasions, adverse food price developments, the evolution of oil prices and increases in indirect taxes and administered prices have all adversely affected the short - term outlook for inflation. however, in the course of this year we expect inflation rates to fall and to remain in line with price stability thereafter. this expectation is based on the assumption that wage developments will remain moderate in the context of a gradual economic recovery. moreover, the past appreciation of the euro should dampen price pressures. these views are also reflected in the available forecasts and projections. we are, of course, fully aware of the conditional nature of these forward - looking exercises and therefore bear in mind all elements of risk to the outlook for price stability. in the same vein, we continue to closely monitor inflation expectations. turning to the monetary analysis, the strong monetary growth of the last few years means that there is significantly more liquidity available in the euro area than needed to finance non - inflationary growth. at the same time, the growth of loans to the private sector has been rising over recent months, benefiting from the low level of interest rates and the general improvement in the economic environment. in our view, the accumulation of excess liquidity should not be of concern for price stability as long as the economic recovery is gradual. however, should excess liquidity remain high once there is a significant strengthening of economic activity, it could lead to inflationary pressures over the medium term. we will therefore carefully examine monetary developments as they unfold. in summary, the economic analysis continues to indicate that the main scenario for price developments in the medium term is in line with price stability. this picture is confirmed by cross - checking with the monetary analysis. concerning fiscal policies, 2004 will be a crucial year for strengthening

mario draghi : ecb press conference – introductory statement introductory statement by mr mario draghi, president of the european central bank, frankfurt am main, 3 july 2014. * * * ladies and gentlemen, the vice - president and i are very pleased to welcome you to our press conference. we will now report on the outcome of today ’ s meeting of the governing council. based on our regular economic and monetary analyses, we decided to keep the key ecb interest rates unchanged. the latest information signals that the euro area economy continued its moderate recovery in the second quarter, with low rates of inflation and subdued monetary and credit growth. at the same time, inflation expectations for the euro area over the medium to long term continue to be firmly anchored in line with our aim of maintaining inflation rates below, but close to, 2 %. the combination of monetary policy measures decided last month has already led to a further easing of the monetary policy stance. the monetary operations to take place over the coming months will add to this accommodation and will support bank lending. as our measures work their way through to the economy, they will contribute to a return of inflation rates to levels closer to 2 %. concerning our forward guidance, the key ecb interest rates will remain at present levels for an extended period of time in view of the current outlook for inflation. moreover, the governing council is unanimous in its commitment to also using unconventional instruments within its mandate, should it become necessary to further address risks of too prolonged a period of low inflation. we are strongly determined to safeguard the firm anchoring of inflation expectations over the medium to long term. as a follow - up to the decisions taken in early june, the governing council today also decided on specific modalities for the targeted longer - term refinancing operations ( tltros ). the aim of the tltros is to enhance the functioning of the monetary policy transmission mechanism by supporting lending to the real economy. a press release on the modalities for the tltros will be published today at 3. 30 p. m. as announced last month, we have also started to intensify preparatory work related to outright purchases in the abs market to enhance the functioning of the monetary policy transmission mechanism. let me now explain our assessment in greater detail, starting with the economic analysis. real gdp in the euro area rose by 0. 2 %, quarter on quarter, in the first quarter of this year. economic indicators, including survey results available up to june