. incoming data, notably survey results, continue to point to solid, broadbased growth in the period ahead. the pass - through of our monetary policy measures has facilitated the deleveraging process and should continue to support domestic demand. in particular, the recovery in investment continues to benefit from very favourable financing conditions and improvements in corporate profitability. employment gains, which are also benefiting from past labour market reforms, are supporting real disposable income and private consumption. moreover, the global recovery is increasingly supporting trade and euro area exports. however, economic growth prospects continue to be dampened by a sluggish pace of implementation of structural reforms, in particular in product markets, and by remaining balance sheet adjustment needs in a number of sectors, notwithstanding ongoing improvements. this assessment is broadly reflected in the june 2017 eurosystem staff macroeconomic projections for the euro area, finalised in late may, which are conditional on the full implementation of all our monetary policy measures. these projections foresee annual real gdp increasing by 1. 9 % in 2017, by 1. 8 % in 2018 and by 1. 7 % in 2019. compared with the march 2017 ecb staff macroeconomic projections, the outlook for real gdp growth has been revised upwards over the projection horizon. 1 / 2 bis central bankers'speeches the risks surrounding the euro area growth outlook are considered to be broadly balanced. on the one hand, the current positive cyclical momentum increases the chances of a stronger than expected economic upswing. on the other hand, downside risks relating to predominantly global factors continue to exist. according to eurostat ’ s flash estimate, euro area annual hicp inflation was 1. 4 % in may, following 1. 9 % in april and 1. 5 % in march. as expected, the recent volatility in inflation rates was mainly due to energy prices and temporary increases in services prices over the easter period. looking ahead, on the basis of current futures prices for oil, headline inflation is likely to remain around current levels in the coming months. at the same time, measures of underlying inflation remain low and have yet to show convincing signs of a pick - up, as unutilised resources are still weighing on domestic price and wage formation. underlying inflation is expected to rise only gradually over the medium term, supported by our monetary policy measures, the continuing economic expansion and the corresponding gradual absorption of economic slack. this assessment is also broadly reflected in the june 2017 eurosystem staff macroeconomic projections

reserves, and liquidity indicators such as current ratio ( percentage of liquid assets in total of liabilities ) are being observed. however, these reports are not yet part of a comprehensive risk measurement and control system. although they give an idea of the general level of market and liquidity risk levels, the actual risk exposure will be clearly seen only after the reserves portfolio is restructured and the benchmarks are included in these reports. the risk management process related to market risk that we plan includes daily marking to market of benchmark portfolios ; monitoring risk limits determined in terms of currency and duration limits ; daily measurement of actual portfolio ’ s var figures for currency and interest rate exposure ; monitoring liquidity ratios and reporting these figures to the top management weekly including stress testing report. there is no specified global risk tolerance limit but our institutional objectives and constraints are reflected in portfolio benchmarks. in terms of performance evaluation comparison of actual and benchmark portfolios returns are going to be monitored daily and reported to the top management periodically. for credit risk management side, a transaction limit is assigned to each counterparty, covering all types of credit risks and market risks. the limits are marked to market daily and reflect the amount of exposure that the bank is willing to take with each counterparty. the credit limits are set by employing an internal scoring model that incorporates the counterparty ’ s external credit ratings, financial information, and some other qualitative information such as the quality of relationship with our bank and the support status, ie the possibility of getting help from the government in case of financial difficulty. the credit rating of the country in which the bank operates is also considered. reports about limit monitoring are produced regularly. i would like to conclude my remarks by underlining once again how important it is to have an efficient risk management to protect our reserves from financial instabilities all over the world. we need to watch the rapid changes in reserve management in terms of technological developments and in terms of economic conditions very closely and adapt our institutions to these changes right away.