, of course, the primary objective of european monetary policy is not to give businesses a cheap source of loans. our mandate is to preserve price stability across the entire currency area. by tightening or loosening financing conditions, we influence aggregate demand. and that is how we have an effect on aggregate inflation. the exceptionally high inflation rates we saw as of mid - 2021, and which peaked in october 2022, forced us to significantly tighten financing conditions. on ten consecutive occasions, my colleagues and i on the governing council raised the key interest rates, lifting them by a total of 450 basis points. since then, euro area inflation as measured by the hicp has dropped significantly. and while that was not only due to the eurosystem's policy restriction, our stance does deserve some of the credit. annual average inflation stood at 8. 4 percent in 2022 and amounted to just 5. 4 percent in 2023. the annual average for this year will probably be two point something. as this year progressed, we, the members of the governing council, became increasingly confident that price pressures would continue to recede. that is why we have lowered the key interest rates on three occasions since june, by 25 basis points each time. we are convinced that, even with the lower interest rates, we will soon and sustainably reach our inflation target of 2 percent. but as with all monetary policy measures, interest rate reductions only take effect with a lag. which is why it would be too late to only ease our stance when the target inflation rate has been reached. at the same time, however, it is important to remain watchful and to ease monetary policy only gradually and not too quickly. you see, risks continue to exist. one risk is the possibility that wage growth will dissipate more slowly than anticipated. another very real risk is that the incoming us administration will put trade policy measures in place that push up inflation in germany as well. furthermore, caution is warranted by the persistently high core inflation, a measure of inflation that strips out volatile energy and food prices. above all services inflation is still strong, with services in the euro area 3 / 7 bis - central bankers'speeches currently costing an average of 4 percent more than they did last year. given that services inflation looks set to gradually diminish as wage pressures subside, the time is approaching from which we can expect to see a sustained return to the 2 percent mark. furthermore, with the deposit facility rate at 3

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