- quarter growth rate of real gdp in the euro area for the fourth quarter of 2006 was 0. 9 %, which was above previous expectations. both domestic demand and exports made significant contributions to this growth, confirming the sustained and broad - based nature of the current expansion. the information on economic activity from various confidence surveys and indicator - based estimates supports the assessment that economic growth has continued into 2007. looking ahead, conditions remain in place for the euro area economy to grow solidly. global economic growth has become more balanced across regions and, while moderating somewhat, remains robust, providing support for euro area exports. domestic demand is expected to maintain its relatively strong momentum. investment is expected to remain dynamic, benefiting from an extended period of very favourable financing conditions, balance sheet restructuring, accumulated and ongoing strong earnings, and gains in business efficiency. consumption should also strengthen further over time in line with developments in real disposable income as employment conditions continue to improve. this outlook for economic developments is also reflected in the new ecb staff macroeconomic projections which foresee average annual real gdp growth in a range between 2. 1 % and 2. 9 % in 2007 and between 1. 9 % and 2. 9 % in 2008. in the governing council ’ s view, the risks surrounding the favourable outlook for economic growth are broadly balanced over the shorter term. at longer horizons, risks lie mainly on the downside, relating to the possibility of a renewed increase in oil prices, fears of a rise in protectionist pressures and concerns about possible disorderly developments owing to global imbalances. turning to the price developments, annual hicp inflation was 1. 8 % in february 2007, unchanged from january 2007. the lower annual hicp inflation rates since the summer of 2006 have been predominantly due to lower energy prices. looking ahead, last year ’ s volatility in energy prices will lead to significant base effects, affecting the profile of annual inflation rates this year. accordingly and on the basis of the current level of oil prices and oil price futures, annual inflation rates are likely to fall during the spring and summer before rising again towards the end of the year and hovering again at around 2 %. the new ecb staff macroeconomic projections point to annual hicp inflation averaging between 1. 5 % and 2. 1 % in 2007 and between 1. 4 % and 2. 6 % in 2008. at the policy - relevant medium - term horizon, the outlook for price developments remains, in the governing

financial services provided to the non - financial corporate sector. 2 see cimadomo, j., furtuna, o. and giuliodori, m. ( 2018 ), “ private and public risk sharing in the euro area ”, working paper series, no 2148, ecb, may. 3 see de guindos, l. ( 2018 ), “ coming to the forefront : the rising role of the investment fund sector for financial stability in the euro area ”, speech at opening conference, 21st euro finance week, frankfurt am main, 12 november. 4 level 3 assets decreased from €188 billion to €132 billion, constituting less than 1 % of significant institutions ’ total assets. 5 see de guindos, l. ( 2018 ), “ building a resilient economic and monetary union ”, lectio magistralis opening the xxix edition of the masters programme in european union law of the university carlos iii of madrid, 5 october. 6 see : www. europarl. europa. eu / eprs / eprs _ study _ 536353 _ cone _ single _ market _ i. pdf 5 / 5 bis central bankers'speeches