christine lagarde : ecb press conference - introductory statement introductory statement by ms christine lagarde, president of the european central bank, and mr luis de guindos, vice - president of the european central bank, frankfurt am main, 18 july 2024. * * * good afternoon, the vice - president and i welcome you to our press conference. the governing council today decided to keep the three key ecb interest rates unchanged. the incoming information broadly supports our previous assessment of the medium - term inflation outlook. while some measures of underlying inflation ticked up in may owing to one - off factors, most measures were either stable or edged down in june. in line with expectations, the inflationary impact of high wage growth has been buffered by profits. monetary policy is keeping financing conditions restrictive. at the same time, domestic price pressures are still high, services inflation is elevated and headline inflation is likely to remain above our target well into next year. we are determined to ensure that inflation returns to our two per cent medium - term target in a timely manner. we will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim. we will continue to follow a data - dependent and meetingby - meeting approach to determining the appropriate level and duration of restriction. in particular, our interest rate decisions will be based on our assessment of the inflation outlook in light of the incoming economic and financial data, the dynamics of underlying inflation and the strength of monetary policy transmission. we are not pre - committing to a particular rate path. the decisions taken today are set out in a press release available on our website. i will now outline in more detail how we see the economy and inflation developing and will then explain our assessment of financial and monetary conditions. economic activity the incoming information indicates that the euro area economy grew in the second quarter, but likely at a slower pace than in the first quarter. services continue to lead the recovery, while industrial production and goods exports have been weak. investment indicators point to muted growth in 2024, amid heightened uncertainty. looking ahead, we expect the recovery to be supported by consumption, driven by the strengthening of real incomes resulting from lower inflation and higher nominal wages. moreover, exports should pick up alongside a rise in global demand. finally, monetary policy should exert less of a drag on demand over time. the labour market remains resilient. the unemployment rate was unchanged, at 6. 4 per cent in may, remaining at its lowest level since the start

inflation rates are foreseen to pick up further during 2016 and 2017, supported by the expected economic recovery, the pass - through of past declines in the euro exchange rate and the assumption of somewhat higher oil prices in the years ahead as currently reflected in oil futures markets. however, this increase in annual inflation rates is currently expected to materialise somewhat more slowly than anticipated thus far. this assessment is also broadly reflected in the september 2015 ecb staff macroeconomic projections for the euro area, which foresee annual hicp inflation at 0. 1 % in 2015, 1. 1 % in 2016 and 1. 7 % in 2017. in comparison with the june 2015 eurosystem staff macroeconomic projections, the outlook for hicp inflation has been revised down, largely owing to lower oil prices. taking into account the most recent developments in oil prices and recent exchange rates, there are downside risks to the september staff inflation projections. in this context, the governing council will closely monitor the risks to the outlook for price developments over the medium term. we will focus in particular on the pass - through of our monetary policy measures, as well as on global economic, financial, commodity price and exchange rate developments. turning to the monetary analysis, recent data confirm robust growth in broad money ( m3 ). the annual growth rate of m3 was 5. 3 % in july 2015, compared with 4. 9 % in june. annual growth in m3 continues to be increasingly supported by its most liquid components, with the narrow monetary aggregate m1 growing at an annual rate of 12. 1 % in july, compared with 11. 7 % in june. loan dynamics continued to improve. the annual rate of change of loans to non - financial corporations ( adjusted for loan sales and securitisation ) increased to 0. 9 % in july, up from 0. 2 % in june, continuing its gradual recovery since the beginning of 2014. despite these improvements, the dynamics of loans to non - financial corporations remain subdued. they continue to reflect the lagged relationship with the business cycle, credit risk, credit supply factors, and the ongoing adjustment of financial and non - financial sector balance sheets. the annual growth rate of loans to households ( adjusted for loan sales and securitisation ) increased to 1. 9 % in july 2015, after 1. 7 % in june. overall, the monetary policy measures we have put in place since june 2014 provide clear support for improvements both in borrowing conditions for firms and households and in credit flows