term horizons. over the past years, the underlying strength of monetary and credit expansion in the euro area has created upside risks to price stability that appear to have become manifest as inflation has trended upwards. this confirms ex post the prominent role our strategy assigns to money. after we have gradually increased the ecb key interest rates from the end of 2005, the underlying money and credit developments now show some first signs of moderation. but all available measures for underlying money growth that are assumed to have leading indicator properties for the development in consumer price inflation are still strong and point to upside risks to price stability in the medium to longer term. m3 growth remains vigorous, although it should be kept in mind that the current headline growth rate of m3 tends to overstate the underlying pace of monetary expansion. the flat euro yield curve at present encourages substitution from longer maturity assets outside m3 into monetary instruments, thereby raising m3 growth. in the context of the financial tensions it turned out that the monetary analysis – by trying to identify the policy - relevant signal in money contained in its lower - frequency developments – offers also important insights into the behaviour of the banking sector and how tensions in the money market have influenced the financial system. for instance, as regards bank loans the conclusion emerged that the availability of funding to the euro area non - financial sector had not been significantly impaired as a result of the financial market tensions. this assessment was a valuable input into the policy discussion, in a context where the existence of a “ credit crunch ” was widely perceived to be established. nevertheless, it is of course true that the growth in loans to the non - financial private sector has moderated recently, and indeed is expected to continue to do so. however, this largely reflects the regular impact of developments in economic activity and tighter credit conditions, with no signs so far of an additional effect coming from the financial tensions. thus, the thorough monetary analysis undertaken by the ecb has informed the shorter - term evaluation of the impact of tensions on the financial sector, on financing conditions and credit availability. this is not to deny, of course, that the prominent role of our monetary analysis is instrumental to maintain our focus on the medium - term horizon, when the effect of monetary policy on our primary objective – price stability – will materialise in full. in the current turmoil the focus on the underlying monetary trend has been of great help to look through the impact of many temporary shocks that affect the economy and to act in a consistent manner over time, thereby supporting the

my mind. privacy the first one is privacy. in our public consultation, 43 % of respondents ranked privacy as the most important aspect of the digital euro, well ahead of other features. so it is clear that if we want the digital euro to be attractive, it needs to be designed in a way that meets people's privacy expectations. 2 / 4 bis - central bankers'speeches we seek to ensure high standards of privacy for digital euro users. but full anonymity – such as offered by cash – does not appear a viable option in my opinion. it would contravene other public policy objectives such as ensuring compliance with anti - money laundering rules and combating the financing of terrorism. and it would also make it virtually impossible to limit the use of the digital euro as a form of investment – for example via holding limits or tiered remuneration – for which identities of users need to be known. we should at least provide a level of privacy equal to that of current electronic payment solutions. but i think it would be desirable to depart from this baseline in certain circumstances. for example, we are exploring together with the european commission whether the digital euro could replicate some cash - like features and enable greater privacy for lowvalue - low - risk payments, including for offline payments. ultimately, finding the right balance between the social value of privacy and the public interest in preventing illicit activities is a political choice and is for the co - legislators to define. legal tender status the second aspect is the legal tender status. although an acceptance obligation has to be weighed against principles such as contractual freedom and competition, we should bear in mind that it is a constitutional feature of cash - as central bank money - to be legal tender. and it would be unprecedented to issue central bank money for retail payments without legal tender status - just because it circulates electronically. moreover, a positive side - effect of a legal tender status may be that it facilitates network effects, allowing citizen to have the option to " pay anywhere " and easily access the digital euro. indeed, the digital euro can only act as a monetary anchor if it becomes a convenient digital medium of exchange that is part of the everyday lives of europeans. it should be available in a broad range of market segments to achieve sufficient network effects. this should include digital payments in physical stores - which is the biggest segment accounting for 40 billion transactions in 2019 - but also e - commerce and peerto - peer payments. we should therefore ensure both widespread acceptance of