mario draghi : interview with le monde interview with mr mario draghi, president of the european central bank, in le monde, conducted by mr erik izraelewicz, ms claire gatinois and mr philippe ricard on 18 july 2012, published 21 july 2012. * * * the international monetary fund ( imf ) has revised downwards its global growth forecasts because of europe. is there a risk of recession? no. since the start of the year, the risks of a deterioration in the economy that we had feared have certainly materialised in part. the situation has gradually worsened, but not to the point of plunging the whole of the monetary union into recession. we still expect a very gradual improvement in the situation by the end of this year or the beginning of next year. thanks to the ecb? the cuts in interest rates at the end of 2011 and in july should produce their effects, as should the unprecedented ltros, three - year loans to banks, which we carried out to deal with the risk of a “ credit crunch ”, a restriction or an increase in the costs for loans. should the ecb not do more to ease the economy, as the imf has requested? we are very open. we do not have any taboos. we decided to reduce interest rates to below 1 % in july because we forecast that inflation would be close to or below 2 % at the start of 2013. it now seems likely that it will fall sooner than expected, at the end of 2012. our mandate is to maintain price stability in order to prevent both higher inflation and a generalised, broadly based fall in prices. if we see such risks of deflation, we will act. the european council of 28 and 29 june was positively received by the markets which since then have expressed doubts. the summit was a success. for the first time, it seems to me, a clear message was given : exit the crisis with more europe. by putting in place a roadmap to create a union with four building blocks – financial, fiscal, economic and political – and delivering tangible results : a financial union, one banking supervisor, allowing the rescue funds to recapitalise banks once this supervision is in place. and a calendar for implementation. these are long - term solutions. doesn ’ t something need to be done about the urgency of the situation? let me tell you about my experience. in 1988 the delors committee set out the route towards monetary union, with a

the european parliament about ten times a year, and we are very active in terms of communication. we stand ready to do more, if our powers were to be strengthened. in the extraordinary conditions that we are experiencing, it is necessary to see the ecb take a stand beyond monetary policy for matters that cannot be addressed by monetary policy, such as high public deficits, a lack of competitiveness or unsustainable imbalances, especially where financial stability may be at risk. safeguarding the euro is part of our mandate. when you arrived at the head of the ecb, you were considered the most german of the italians. is this still the case? that ’ s up to you to judge! we have to maintain price stability in both directions, face problems as they present themselves, and act without prejudice. bis central bankers ’ speeches in some ways you are very german when you support the calls for political union made by angela merkel any move towards a financial, budgetary and political union is, to my mind, inevitable. this will lead to the creation of new supranational entities. in some countries the transfer of sovereignty – i prefer to say sharing – that this implies is a major stake, in others it is no problem. but one must remember that with globalisation, it is precisely by sharing sovereignty that countries can better preserve it. in the long term, the euro must be based on a greater degree of integration. is a greek exit from the euro area still a leading concern? our unequivocal preference is for greece to remain in the euro area. but that is a matter for the greek government. it has stated its commitment, now it must deliver results. regarding the renegotiation of the memorandum [ to ease the austerity measures and reforms imposed on the country ], i will not take any stance before seeing the troika ’ s report. on friday, 20 july, the finance ministers of the euro area should have completed the aid plan for banks. have they done so? will it suffice to prevent the country from defaulting? one important point is the involvement of senior creditors of banks : the ecb believes that such involvement should be possible in the case of the liquidation of a bank. savers must be protected, but creditors should be part of the solution of the crisis. it is a matter of limiting the involvement of taxpayers. they have already paid a great deal! do you think you can go on