of the real economy. together, these measures have already helped – and continue to help – ease financing conditions in the euro area. 2. expanded asset purchase programme despite this progress, the growing threat of prolonged weakness in inflation has made new measures necessary. as a result, in january 2015 the governing council decided to launch an expanded asset purchase programme. at a time of weak domestic inflationary pressures, the steep drop in oil prices from mid - 2014 onwards caused inflation to weaken further. moreover, an extended period of excessively weak inflation can affect inflation expectations and thereby become self - perpetuating. a firm monetary response was needed. thus, we decided to expand our asset purchase programme. the combined purchases of public and private sector debt will amount to €60 billion per month. they began in march and are expected to continue until the end of september 2016. in any event, they will continue until the governing council sees a sustained adjustment in the path of inflation that is consistent with its goal of achieving rates below, but close to, 2 % over the medium term. how does this asset purchase programme affect the real economy, and thereby, inflation? the first transmission channel is that of confidence. the purchases put inflation back on a path consistent with a pace of close to 2 % over the medium term and give the confidence bis central bankers ’ speeches boost needed for a recovery in private investment, which remains too far from its pre - crisis level ( 16. 8 % of gdp in 2014 compared with 19. 9 % in 2007 in the euro area ). a second transmission channel involves lowering sovereign bond yields, which are used as a price - setting benchmark for a wide range of private sector financial instruments, such as bank loans to households and businesses. thirdly, the large amounts of liquidity injected through these purchases will allow private investors ( banks and non - banks ) to undertake portfolio shifts into other financial assets, particularly loans to the economy. this will lead to more favourable conditions for all instruments used to finance the economy. lastly, the easing of financing conditions also influences the exchange rate, although this is not an objective in and of itself. where do we stand with respect to the programme ’ s implementation? we have begun purchasing securities with no major difficulties, and the pace of monthly purchases is consistent with the stated target. the positive impact of our most recent measures on the financing of the real economy can already be seen. bank lending rates have fallen by 40 to 50 basis points since summer 2014, and

and frequency of information on banks ’ exposures and risk concentrations – would improve the identification of potential risks to the stability of the euro area financial system as well as the assessment of the potential impact on the system of the possible materialisation of the identified risks. as fed chairman bernanke recently said : “ for risks to financial stability to be successfully managed, they must first be identified and measured. recent developments have revealed deficiencies in this respect ”. before the outbreak of the market turmoil in mid - 2007, conventional wisdom held that banks had successfully removed credit risk from their balance sheets, thanks to financial innovations such as mortgage - backed securities, collateralised debt obligations and the use of structured investment vehicles ( sivs ). relatively little was known about the role and activities of sivs and the exact nature of their relationship with banks. one could argue that, if more in - depth supervisory information had been available on these aspects, central banks, including the ecb, could have seen that banks ’ credit risk transfer to sivs and investors was in many cases incomplete and that banks remained liable for sivs ’ liabilities. of course, it ’ s easy to say this with hindsight but we should now learn from this experience. in a situation of financial stress, supervisory information remains essential is the central bank financial stability assessment is to be effective. however, the nature of each financial stress is likely to differ from the previous ones. therefore, the information needs have to be identified on a case - by - case basis. in the context of the current turmoil, a key supervisory information is that on bank direct exposures to the us sub - prime sector and to structured financial products as well as to the effects of write - downs on banks ’ capital position. overall, a wide access by central banks, including the ecb, to supervisory information would render their financial stability assessment more effective both to monitor and prevent financial stresses. at the same time, the outcome of the central banks ’ financial stability assessment can be of use to supervisory authorities, for instance, by helping them focus their monitoring activity on certain categories of risk. this is the rationale behind the specific fsf recommendation which i mentioned at the beginning, namely, to enhance the interplay between central banks and supervisory authorities. 5. legal and institutional aspects coming closer to the end of my remarks, let me now turn to institutional arrangements. the task of contributing to the smooth conduct of supervisory policies, mentioned in art. 105. 5 of the eu