a banking union will help to accomplish this objective. in particular, the governing council emphasises that the future single supervisory mechanism and a single resolution mechanism are crucial elements for moving towards re - integrating the banking system and therefore require swift implementation. to sum up, taking into account today ’ s decisions, the economic analysis indicates that price developments should remain in line with price stability over the medium term. a cross - check with the signals from the monetary analysis confirms this picture. bis central bankers ’ speeches with regard to fiscal policies, the spring 2013 deficit and debt data notifications by euro area countries indicate that the average government deficit declined from 4. 2 % of gdp in 2011 to 3. 7 % in 2012. over the same period, the average government debt rose from 87. 3 % to 90. 6 % of gdp. in order to bring debt ratios back on a downward path, euro area countries should not unravel their efforts to reduce government budget deficits and continue, where needed, to take legislative action or otherwise promptly implement structural reforms, in such a way as to mutually reinforce fiscal sustainability and economic growth potential. such structural reforms should target improvements in competitiveness and adjustment capacities, as well as aim to increase sustainable growth and employment. we are now at your disposal for questions. bis central bankers ’ speeches

rate reflects a significant fall in energy prices, but is also due to a sizeable transitory effect coming from the annual rate of change in services prices on account of the timing of easter. inflation rates could remain subject to some volatility throughout the year. looking further ahead, underlying price trends should persist and, over the medium term, inflation expectations remain firmly anchored in line with price stability. taking into account today ’ s decisions, risks to the outlook for price developments are broadly balanced over the medium term, with upside risks relating to stronger than expected increases in administered prices and indirect taxes, as well as higher commodity prices, and downside risks stemming from weaker economic activity. turning to the monetary analysis, recent data confirm that the underlying pace of monetary expansion continues to be subdued. annual growth in broad money moderated in march, standing at 2. 6 %, after 3. 1 % in february. the annual growth rate of the narrow monetary aggregate, m1, increased slightly further to 7. 1 % in march, reflecting the continued preference for the most liquid instruments in m3. deposits with the domestic money - holding sector continued to grow further in most stressed countries in march. the annual growth rates of loans ( adjusted for loan sales and securitisation ) to non - financial corporations and households have now remained broadly unchanged since the turn of the year, standing in march at – 1. 3 % and 0. 4 % respectively. to a large extent, weak loan dynamics reflect the current stage of the business cycle, heightened credit risk and the ongoing adjustment of financial and non - financial sector balance sheets. the recent bank lending survey ( bls ) confirmed weak demand for loans in the euro area. while some signs of stabilisation are emerging, the survey on the access to finance of small and medium - sized enterprises ( smes ) in the euro area indicates continued tight credit conditions, particularly for smes in several euro area countries. moreover, the available information indicates high risk perception on the part of banks. in order to ensure adequate transmission of monetary policy to the financing conditions in euro area countries, it is essential that the fragmentation of euro area credit markets continues to decline further and that the resilience of banks is strengthened where needed. progress has been made since last summer in improving the funding situation of banks, in strengthening the domestic deposit base in stressed countries and in reducing reliance on the eurosystem as reflected in repayments of the three - year ltros. further decisive steps for establishing