. it is within this context that i appreciate the commitment of euro area member states, made on the occasion of the last european council meeting, to take determined and coordinated action, if needed, to safeguard financial stability in the euro area. let me also take advantage of my presence in front of the european parliament to lay out what i already mentioned in the hearing before the economic and monetary committee on monday. it is the intention of the ecb ’ s governing council to keep the minimum credit threshold in the collateral framework at investment grade level ( bbb – ) beyond the end of 2010. in parallel, we would introduce, as of january 2011, a graded haircut schedule, which will continue to adequately protect the eurosystem. i will provide the technical details when reporting on the governing council decisions of our next meeting on 8 april. conclusion the introduction of the single currency just over a decade ago represents the greatest achievement in the history of european integration to date – a process that has ensured six decades of peace and prosperity in europe. the global financial crisis has brought fresh challenges to which we in europe have all risen. our monetary union and our very close ties, inside the single market, with all eu member states ’ economies have prevented the crisis from being compounded by currency crises, as in the traumatic experiences of the early 1990s. today, europe faces further pivotal decisions. our common task is to ensure continued peace and prosperity, to make our union an even more attractive place to live and work in. for this purpose, we need strengthened surveillance and strengthened cooperation. we also need to revive the sense of common purpose, the shared ideals that motivated our founding fathers. their endeavour was visionary and all what we see in today ’ s world confirms their lucidity. thank you for your attention.

that the pace of recovery will be uneven and we cannot rule out setbacks. for another, we are still facing numerous challenges regarding the reform of our financial system. finance must play a constructive role, and not a destructive one, in our economies. the litmus test for a constructive role is that finance serves the real economy. to ensure such a role, we still need to improve the functioning of financial systems considerably further. thus far, a great deal of attention has been focused on the banking sector. but effective reforms also have to look very closely at non - bank financial institutions and at the set - up and functioning of financial markets. financial markets are not always efficient. they are not always deep and liquid. nor do they always represent a fair competition of views and positions. often, specific market segments can be oligopolistic, dominated by a few large players. in such markets, the views of powerful players can trigger trends that move valuations way out of line with fundamentals. we have to devise mechanisms and incentives to ensure that finance does not spiral out of control in the destructive way that it did just prior to the crisis. we have to contain systemic disruptions that lead to economic hardship for the people of europe. setting up the european systemic risk board, legislation for which is currently being considered by the parliament, is part of the correct response to this challenge. there are other challenges facing the european economy, and these are associated with public finances and sovereign financial health. within europe ’ s economic and monetary union, there is a clear allocation of responsibilities. with respect to that allocation of responsibilities, everyone can count on the commitment of the ecb to maintain price stability in the euro area as a whole over the medium term. meanwhile, we have not only this commitment, but we also have a track record of nearly a dozen years. based on our latest staff macroeconomic projections for this year, the average annual inflation rate in the first 12 years of the euro is likely to stand at around 1. 95 %. that is in line with our definition of price stability : “ below 2 %, but close to 2 % ”. the ecb ’ s commitment, strategy and track record are consistent. but the smooth functioning of europe ’ s economic and monetary union cannot rest on a single pillar. emu rests on two pillars, the monetary and the economic one. policy - makers at the national level must likewise contribute to the success and stability of emu and they need to deliver