jean - claude trichet : ecb press conference – introductory statement introductory statement by mr jean - claude trichet, president of the european central bank, and mr vitor constancio, vice - president of the european central bank, frankfurt am main, 8 september 2011. * * * ladies and gentlemen, the vice - president and i are very pleased to welcome you to our press conference. we will report on the outcome of today ’ s meeting of the governing council, which was also attended by commissioner rehn. based on its regular economic and monetary analyses, the governing council decided to keep the key ecb interest rates unchanged. inflation has remained elevated and is likely to stay above 2 % over the months ahead before declining next year. at the same time, the underlying pace of monetary expansion continues to be moderate, while monetary liquidity remains ample. as expected, the pace of economic growth in the euro area decelerated in the second quarter, following strong growth in the first quarter. looking ahead, we expect the euro area economy to grow moderately, subject to particularly high uncertainty and intensified downside risks. at the same time, short - term interest rates are low. while our monetary policy stance remains accommodative, some financing conditions have tightened. it remains essential for monetary policy to focus on its mandate of maintaining price stability over the medium term, thereby ensuring that recent price developments do not give rise to broad - based inflationary pressures. a very thorough analysis of all incoming data and developments over the period ahead is warranted. inflation expectations in the euro area must remain firmly anchored in line with our aim of maintaining inflation rates below, but close to, 2 % over the medium term. such anchoring is a prerequisite for monetary policy to make its contribution towards supporting economic growth and job creation in the euro area. we will continue to monitor very closely all developments. the provision of liquidity and the allotment modes for refinancing operations will continue to ensure that euro area banks are not constrained on the liquidity side. all the non - standard measures taken during the period of acute financial market tensions are, by construction, temporary in nature. let me now explain our assessment in greater detail, starting with the economic analysis. euro area real gdp growth decelerated to 0. 2 % quarter on quarter in the second quarter of 2011, after 0. 8 % in the first quarter. as expected, temporary factors which had boosted growth in the early part of

the year ceased, and adverse effects resulted from the japanese earthquake and the lagged impact of past oil price increases. looking ahead, a number of developments seem to be dampening the underlying momentum in the euro area, including a moderation in the pace of global growth, related declines in equity prices and in business confidence, and unfavourable effects resulting from ongoing tensions in a number of euro area sovereign debt markets. as a consequence, real gdp growth is expected to increase very moderately in the second half of this year. at the same time, we continue to expect euro area economic activity to benefit from ongoing growth in the global economy as well as from the accommodative monetary policy stance and the various measures taken to support the functioning of the financial sector. this assessment is also reflected in the september 2011 ecb staff macroeconomic projections for the euro area, which foresee annual real gdp growth in a range between 1. 4 % and 1. 8 % in 2011 and between 0. 4 % and 2. 2 % in 2012. compared with the june 2011 eurosystem staff macroeconomic projections, the ranges for real gdp growth in 2011 and 2012 have been revised downwards. in the governing council ’ s assessment, the risks to the economic outlook for the euro area are on the downside, in an environment of particularly high uncertainty. downside risks bis central bankers ’ speeches mainly relate to the ongoing tensions in some segments of the financial markets in the euro area and at the global level, as well as to the potential for these pressures to spill over into the euro area real economy. they also relate to further increases in energy prices, protectionist pressures and the possibility of a disorderly correction of global imbalances. with regard to price developments, euro area annual hicp inflation was 2. 5 % in august 2011, according to eurostat ’ s flash estimate, unchanged from july. we have now seen inflation rates at relatively high levels since the end of last year, with higher energy and other commodity prices as the main drivers. looking ahead, inflation rates are likely to stay clearly above 2 % over the coming months. thereafter, on the basis of the path implied by futures markets for oil prices, inflation rates should fall below 2 % in 2012. this pattern reflects the expectation of relatively stable wage growth developments in the context of moderate economic growth. the september 2011 ecb staff macroeconomic projections for the euro area embody these considerations and foresee annual hicp inflation in a range