demand and a faster - than - anticipated increase in consumer spending could result in an even stronger recovery. turning to price developments, euro area annual inflation has picked up over recent months, largely owing to temporary factors, including strong increases in energy price inflation. headline inflation is likely to increase further towards the autumn, reflecting mainly the reversal of the temporary vat reduction in germany, before declining at the start of next year as temporary factors fade out. underlying price pressures are expected to increase somewhat this year owing to temporary supply constraints and the recovery in domestic demand, but are likely to remain subdued. 1 / 4 bis central bankers'speeches as you specifically asked me to comment on the spill - overs to the euro area from rising inflation in the united states, let me point out that these occur both through the direct channel of imported goods originating in the united states and through several indirect trade or expectations mechanisms. for example, to the extent that the increase in inflation reflects stronger demand in the united states, inflationary pressures for the euro area can materialise owing to higher foreign demand for euro area goods and services. international spill - overs from us inflation can be amplified if people in the euro area shape their inflation expectations also on the basis of developments in the united states. overall, however, the effects on euro area hicp inflation are expected to be moderate. once the impact of the pandemic recedes, the unwinding of the high level of slack, supported by accommodative fiscal and monetary policies, will contribute to a gradual increase in underlying inflation over the medium term. however, the upward effect of the underlying inflation pressures on headline inflation will be roughly counterbalanced by the expected decline in energy prices. accordingly, our latest eurosystem staff macroeconomic projections foresee headline inflation at 1. 9 per cent in 2021, 1. 5 per cent in 2022 and 1. 4 per cent in 2023. compared with the march 2021 ecb staff macroeconomic projections, inflation has been revised up for 2021 and 2022, largely owing to temporary factors and higher energy price inflation, and is unchanged for 2023 at a level below our inflation aim. the ecb ’ s monetary policy stance at our last monetary policy meeting in early june, we also conducted a joint assessment of the developments in financing conditions taking into account the updated inflation projections. borrowing conditions for firms and households have remained broadly stable, although market interest rates have increased further since march. while partly reflecting improved economic prospects, a

technical platform. it guarantees a harmonised level of service for banks all over europe combined with one single transaction price for domestic and cross - border payments and is one of the best individual payment systems in the world. this system was developed and is operated by a “ consortium ” of central banks – the banca d ’ italia, the banque de france and the deutsche bundesbank – on behalf of the eurosystem. target2 securities will be a platform for the cross - border and domestic settlement of securities against central bank money. the development and operation of this system was assigned to the deutsche bundesbank, the banco de espana, the banque de france and the banca d ’ italia. following a review of the current eurosystem collateral management handling procedures, in particular, the correspondent central banking model ( ccbm ), the governing council decided to again develop a single platform, called ccbm2, allowing the eurosystem to manage collateral both for domestic and cross - border operations. work will be undertaken by the nationale bank van belgie / banque nationale de belgique and de nederlandsche bank based on their existing system. as you can see a range of different organisational models are explored to achieve maximum synergies, e. g. specialisation, attribution to one particular member of the eurosystem team, decentralisation and, when and where needed, pooling, which means that a group of central banks provides a service for the entire eurosystem. you will not be surprised that i would stress that in call cases it is important that the ecb ensures the coherence of the full team by exercising in an appropriate fashion its captainship. let me conclude by warmly congratulating the banque centrale du luxembourg on its 10th anniversary. i think i can say that both our institutions are looking back on a decade of challenges successfully mastered. during the ten years of the eurosystem ’ s existence, and in particular during the recent months of financial crisis, we have proven that the eurosystem functions well, even in periods of great stress. the eurosystem has passed the test of its first decade of existence. looking ahead, i am confident that with its unique architecture and a strong and enduring team spirit it is also prepared to tackle the challenges of the future. i thank you for your attention.