jens weidmann : introductory comments delivered at the press conference on the annual accounts speech by dr jens weidmann, president of the deutsche bundesbank and chairman of the board of directors of the bank for international settlements, at the press conference for the annual report 2015, frankfurt am main, 24 february 2016. * 1. * * introduction ladies and gentlemen, i too would like to welcome you to this press conference marking the publication of the bundesbank ’ s annual accounts for 2015. the annual accounts and underlying balance sheet of an enterprise or an institution like the bundesbank reflect not just the setting in which it operates but also the results of its own actions. i would therefore like to begin by providing a description of this setting before going on to present the annual accounts with my esteemed colleague dr nagel. 2. challenges for monetary policy last year, low inflation rates once again set the tone of the monetary policy debate. consumer prices rose at a rate of just 0. 2 %, thus increasing at an even slacker pace than in 2014. this was compounded by economic forecasts, including eurosystem projections, which suggested that inflation would only gradually approach the target rate of below, but close to 2 % at which it should stand over the medium term according to the ecb governing council ’ s definition of price stability. consumers are likely to welcome this prospect because of its effect on their purchasing power, but in monetary policy terms these forecasts have stoked discussion about the credibility of this policy and a narrower safety margin to the zero interest bound, which limits the possible responses to future adverse developments. against this background, inflation developments both at the start and at the end of 2015 triggered a lively debate among members of the ecb governing council. in the upshot, the council decided in january 2015 that for the next 19 months it would purchase not just certain private debt securities but also government bonds on a large scale. at its meeting in early december 2015, this programme was extended by an additional six months up to march 2017. moreover, the council lowered the deposit facility rate to – 0. 3 %, thus obliging banks to pay a higher penalty interest rate whenever they deposit excess liquidity with the central banks. at its monetary policy meeting at the beginning of march this year, the ecb staff will once again present an update of the projection for economic output and price developments for the period 2016 to 2018, which the governing council will then use to assess its monetary

monetary and fiscal policy, and they have made us the largest creditor of the euro area countries. this poses a threat to our independence. furthermore, if the capital markets are to encourage fiscal policymakers to embrace fiscal 3 / 4 bis central bankers'speeches prudence, it is vital that market mechanisms generally continue to function properly. i believe that changing the parameters – which is sometimes discussed rather carelessly, in my opinion – would have considerable negative repercussions for those mechanisms. a clear sense of scepticism is also apparent in the german federal constitutional court ’ s decision to refer the government bond purchase programme to the european court of justice. 3 conclusion / outlook so let me recap my main points on the pspp. first, the eurosystem has been successful in smoothly implementing the pspp. purchases will be recalibrated as a result of improvements in the economic and monetary environment in the euro area. second, temporary deviations from the capital key are not a discretionary policy choice to support individual countries. they have purely technical reasons and reflect the fact that we want to be as market - neutral as possible in our purchases. third, smooth implementation of the pspp does not mean rewriting the rules whenever compliance with the rules would impose any kind of restrictions. abandoning the capital key as reference value or increasing the limit for issue shares and issuers would take monetary policymakers deep into the realm of fiscal policy – in my view, too deep. ladies and gentlemen, in the last 15 minutes the focus was on the pspp. but let ’ s not get too carried away with this instrument. i would warmly recommend that you take the trouble to broaden your view to the other decisions by the ecb governing council, including private sector purchases, reinvestments, forward guidance, targeted longer - term refinancing operations and, of course, key rates. on aggregate, the monetary policy stance of the eurosystem will remain highly accommodative for a while yet. 4 / 4 bis central bankers'speeches