in genuine european public goods – for instance energy grids and interconnections. we can and should learn from our experiences with existing instruments to design effective tools. but the bulk of the funding for the transition will have to come from private funding sources. in the euro area, banks will play an essential role in supporting investment and the adoption of green technologies by firms and households. however, a key eu policy objective is to further develop capital markets [ 43 ], which could provide specialised funding and support innovation. the market for green financial products has grown significantly in recent years, [ 45 ] but there is room for more progress. in a recent report on the future of the single market, enrico letta pointed to the need to better channel private savings into the green transition. he noted that there are approximately €33 trillion in private savings sitting in current accounts in the eu, which are therefore not being fully leveraged to meet investment needs. better channelling these private funds could provide a substantial boost to the eu ’ s green investment goals. to achieve this, it is essential to make further progress on completing the capital markets union. in this respect, the eu could also explore the scope for measures that target green segments of capital markets. conclusion in conclusion, the urgent need to combat climate change cannot be overstated. we should have acted yesterday, and we certainly cannot afford to wait until tomorrow. climate change is accelerating as we speak and it has important implications for central banks because it has an impact on inflation and the exposure to supply shocks, while lowering potential output and productivity growth. it also creates financial risks for the central bank ’ s balance sheet. so we face two mutually exclusive paths : either we choose inaction and find ourselves trapped in a vicious cycle of constantly responding to escalating crises or we proactively seek to prevent the emergence of new climate and energy crises through sound and coordinated policies. at the ecb, we are steadfast in our commitment to support the green transition within the scope of our mandate. however, this is not a task we can accomplish alone. it requires a collective effort by all stakeholders across europe. in turn, we as central banks can benefit from these efforts in the pursuit of our objectives. specifically, the eu will need to implement robust supply side policies to move away from fossil fuels, enhance energy efficiency and ensure the availability of key raw materials. to transform our ambitions into tangible outcomes, substantial investments are necessary. by pooling resources across europe and establishing

council ’ s view, subject to upside risks. these stem from the possibility of renewed oil price increases and additional increases in administered prices and indirect taxes beyond those announced and decided thus far. more fundamentally, stronger than currently expected wage developments would pose significant upward risks to price stability, particularly in view of the favourable momentum of real gdp growth. it is therefore crucial that the social partners continue to meet their responsibilities and that wage agreements take into account present relative price competitiveness positions, the still high level of unemployment in many countries as well as productivity developments. the governing council will monitor the upcoming wage negotiations in the euro area countries very carefully. turning to the monetary analysis, this confirms the prevailing upside risks to price stability at medium to longer horizons. annual m3 growth was unchanged at 9. 8 % in january, remaining at the highest rate observed since the introduction of the euro. at 10. 6 %, the annual growth rate of loans to the private sector also remained strong in january. this reflects the continuation of the upward trend in the growth of borrowing by non - financial corporations seen since mid - 2004. meanwhile, the growth of household borrowing has shown some further signs of moderation in recent months, albeit remaining at still high rates. taking the appropriate medium to longer - term perspective, the latest developments confirm the continuation of a persistent upward trend in the underlying rate of monetary expansion. furthermore, following several years of robust monetary growth, the liquidity situation in the euro area is ample by all plausible measures. the robust expansion of money and credit in an environment of ample liquidity points to upside risks to price stability over the medium to longer term. monetary developments therefore continue to require very careful monitoring, particularly against the background of a solid expansion in economic activity and continued strong property market developments in many parts of the euro area. to sum up, in assessing price trends it is important to look through any short term volatility in inflation rates. at the policy - relevant horizon of the medium term, risks to price stability remain on the upside, relating in particular to stronger than currently expected wage developments in a context of robust ongoing growth in employment and economic activity. given the vigorous monetary and credit growth in an environment of already ample liquidity, a cross - check of the outcome of the economic analysis with that of the monetary analysis supports the assessment that upside risks to price stability prevail over the medium to longer term. monetary policy transmission in the euro area and the us in my remarks today i would also like to