significant spreads between bid rates and the prevailing mro rate. furthermore, the governing council decided, in line with its decision on the 12 - month ltro of 16 december 2009, to fix the rate in the six - month ltro to be allotted on 31 march 2010 at the average minimum bid rate of the mros over the life of this operation. with today ’ s decisions, the eurosystem continues to provide liquidity support to the banking system of the euro area at very favourable conditions, thereby facilitating the provision of credit to the euro area. at the same time, these decisions help to avoid distortions associated with maintaining non - standard measures for longer than needed. the governing council will continue to implement the gradual phasing - out of the extraordinary liquidity measures. in order to counter effectively any threat to price stability over the medium to longer term, the liquidity provided will be absorbed when necessary. accordingly, we will continue to monitor very closely all developments over the period ahead. let me now explain our assessment in greater detail, starting with the economic analysis. over recent quarters, the euro area has continued to benefit from the significant macroeconomic stimulus provided and the measures adopted to restore the functioning of the banking system, as well as from the ongoing recovery in the world economy. according to eurostat ’ s first release, in quarter - on - quarter terms euro area real gdp increased by 0. 1 % in the fourth quarter of 2009, after growing by 0. 4 % in the third quarter. available indicators suggest that the economic recovery in the euro area is on track, although it is likely to remain uneven. in particular, a number of special factors are at play, including adverse weather conditions in parts of the euro area in the first quarter of 2010. given this uneven pattern, it is more appropriate to look through the quarterly volatility and to compare growth developments on a half - yearly basis. looking ahead, the governing council expects real gdp growth to remain moderate in 2010, owing to the ongoing process of balance sheet adjustment in various sectors and the expectation that the low capacity utilisation is likely to dampen investment and that consumption is being dampened by weak labour market prospects. this assessment is also reflected in the march 2010 ecb staff macroeconomic projections for the euro area, which foresee annual real gdp growth in a range between 0. 4 % and 1. 2 % for 2010 and between 0. 5 % and 2. 5 % for 2011. compared with the

economic analysis with that of the monetary analysis confirms the assessment of low inflationary pressures over the medium term. all in all, we expect price stability to be maintained over the medium term, thereby supporting the purchasing power of euro area households. inflation expectations remain firmly anchored in line with the governing council ’ s aim of keeping inflation rates below, but close to, 2 % over the medium term. as regards fiscal policies, high levels of public deficit and debt place an additional burden on monetary policy and undermine the stability and growth pact as a key pillar of economic and monetary union. it is of paramount importance that the stability programme of each euro area country clearly defines the fiscal exit and consolidation strategies for the period ahead. this requires determined efforts, notably on the side of countries with high deficit and debt levels. all countries will be required to meet their commitments under the excessive deficit procedures. consolidation of public finances should start in 2011 at the latest and will have to exceed substantially the annual adjustment of 0. 5 % of gdp set as a minimum requirement by the stability and growth pact. a strong focus on expenditure reforms is needed. the governing council issued, on 3 march 2010, a statement on the additional fiscal consolidation measures announced by the greek government. in all euro area countries, the key challenge in order to reinforce sustainable growth and job creation is to accelerate structural reforms. policies should be adopted which open up market access and increase competition. overall, it is essential to set the stage for long - term investment in innovation so as to create new business opportunities. sectoral support schemes implemented to cope with the immediate effects of the crisis should now be phased out. in labour markets, moderate wage setting in several economies and sufficient labour market flexibility are required in order to avoid higher structural unemployment over the coming years. these structural reforms should be supported by an appropriate restructuring of the banking sector. sound balance sheets, effective risk management and transparent, robust business models are key to strengthening banks ’ resilience to shocks and to ensuring adequate access to finance, thereby laying the foundations for sustainable growth and financial stability. we are now at your disposal for questions.