mario draghi : ecb press conference - introductory statement introductory statement by mr mario draghi, president of the european central bank, and mr vitor constancio, vice - president of the european central bank, frankfurt am main, 20 october 2016. * * * 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. we continue to expect them to remain at present or lower levels for an extended period of time, and well past the horizon of our net asset purchases. regarding non - standard monetary policy measures, we confirm that the monthly asset purchases of €80 billion are intended to run until the end of march 2017, or beyond, if necessary, and in any case until the governing council sees a sustained adjustment in the path of inflation consistent with its inflation aim. the information that has become available since our meeting in early september confirms a continued moderate but steady recovery of the euro area economy and a gradual rise in inflation, in line with our previous expectations. the euro area economy has continued to show resilience to the adverse effects of global economic and political uncertainty, aided by our comprehensive monetary policy measures, which ensure very favourable financing conditions for firms and households. overall, however, the baseline scenario remains subject to downside risks. looking ahead, we remain committed to preserving the very substantial degree of monetary accommodation which is necessary to secure a sustained convergence of inflation towards levels below, but close to, 2 % over the medium term. to that end, we will continue to act, if warranted, by using all the instruments available within our mandate. in december the governing council ’ s assessment will benefit from the new staff macroeconomic projections extending through to 2019 and from the work of the eurosystem committees on the options to ensure the smooth implementation of our purchase programme until march 2017, or beyond, if necessary. let me now explain our assessment in greater detail, starting with the economic analysis. real gdp in the euro area increased by 0. 3 %, quarter on quarter, in the second quarter of 2016, after 0. 5 % in the first quarter. the latest data and survey results point to continued growth in the third quarter of 2016, at around the same pace as in the second quarter. looking further ahead, we expect the economic expansion to

proceed at a moderate but steady pace. domestic demand should be supported by the pass - through of our monetary policy measures to the real economy. favourable financing conditions and improvements in corporate profitability continue to promote a recovery in investment. moreover, still relatively low oil prices and sustained employment gains, which are also benefiting from past structural reforms, provide additional support for households ’ real disposable income and private consumption. in addition, the fiscal stance in the euro area will be broadly neutral in 2017. however, the economic recovery in the euro area is expected to be dampened by still subdued foreign demand, the necessary balance sheet adjustments in a number of sectors and a sluggish pace of implementation of structural reforms. the risks to the euro area growth outlook remain tilted to the downside and relate mainly to the external environment. according to eurostat, euro area annual hicp inflation in september 2016 was 0. 4 %, up from 0. 2 % in august. this reflected mainly a continued increase in annual energy inflation, while there are no signs yet of a convincing upward trend in underlying inflation. looking ahead, on the basis of current oil futures prices, inflation rates are likely to pick up over the next couple of months, in large part owing to base effects in the annual rate of change of energy prices. supported by our monetary policy measures and the expected economic recovery, inflation rates should increase 1 / 2 bis central bankers'speeches further in 2017 and 2018. turning to the monetary analysis, broad money ( m3 ) continued to increase at a robust pace in august 2016, with its annual rate of growth standing at 5. 1 %, after 4. 9 % in july. as in previous months, annual growth in m3 was mainly supported by its most liquid components, with the narrow monetary aggregate m1 expanding at an annual rate of 8. 9 % in august, after 8. 4 % in july. loan dynamics followed the path of gradual recovery observed since the beginning of 2014. the annual rate of change of loans to non - financial corporations stood at 1. 9 % in august 2016. the annual growth rate of loans to households also remained stable, at 1. 8 %, in august. although developments in bank credit continue to reflect the lagged relationship with the business cycle, credit risk and the ongoing adjustment of financial and non - financial sector balance sheets, the monetary policy measures in place since june 2014 are significantly supporting borrowing conditions for firms and households and thereby credit flows across the euro area. the