s policy rate – that has the ultimate impact on household consumption or firm investment decisions. increasing real interest rates thus indicated that further monetary easing was necessary despite the policy rates being close to the zero lower bound. [ slide 7 : eurosystem ’ s accommodative monetary policy ] in the june 2014 monetary policy meeting, the governing council eased the stance of monetary policy. as a part of the package, we cut the deposit rate to negative, extended the guarantee of banks ’ access to unlimited central bank finance ( given that they provide sufficient bis central bankers ’ speeches collateral ) by extending fixed rate full allotment policy, and we set up a series of additional long - term refinancing operations that provide the banks with finance on the condition that they increase the value of their loans to the real economy. the current cycle of monetary policy easing started in october 2014 when we introduced two private sector asset purchase programmes : the asset backed securities purchase programme and the third programme for covered bonds. in january 2015 the governing council judged that additional monetary policy easing was needed as the inflation outlook weakened further. the eurosystem extended its purchases to bonds issued by euro area governments, government agencies and european institutions. [ slide 8 : ii – key features of eapp ] let us now discuss the current, expanded asset purchase programme, in more detail. [ slide 9 : the eurosystem sets the liquidity of the euro area banking system ] the eurosystem is able to regulate the euro area banking system ’ s liquidity with two tools. firstly, the eurosystem organises regular refinancing operations : tenders. the interest rate applied to these operations is the main policy rate, which currently stands at 0. 05 %. with these refinancing operations the eurosystem steers short - term money market rates. the tender operations are demand driven : banks can decide whether or not to participate. in contrast, outright asset purchases are not demand driven. by asset purchases the central bank actively steers liquidity of the banking sector by bond purchases. participants of regular tender operations consist of monetary policy counterparties, mainly banks. outright purchases reach directly a much broader set of financial institutions, some of which are not even located within the euro area. as instruments bought by the eurosystem may have maturity of up to 30 years, with these purchases the eurosystem is able to steer longer term interest rates. [ slide 10 : eapp consists of two parts ] the euros

youth, education outside of the class room has been successful, so that the youth are continuously exposed to a work environment and accumulate experience. german style apprenticeship programs have been found to pave the way from education to working life. wages provide incentives wages provide incentives. the relative wages of different occupations should reflect demand and supply conditions and direct young workers to those sectors and occupations where work is available. bis central bankers ’ speeches is the “ german labour market miracle ” a textbook example of successful reforms? in germany both unemployment and youth unemployment have continued during the crisis, now the unemployment rate being at its lowest rate in two decades, at 6 % and youth unemployment at 8. 5 %. although this impressive evolution of unemployment and youth unemployment is in part due to better economic development than in other euro area countries, the german labor market institutions play a role. the target of the german labor market institutions and reforms has not been the youth only, but because the youth are at “ the margin ”, meaning that changes in unemployment affect them more than proportionately, the general labour market reforms have successfully also reduced youth unemployment. the key institutions and reforms in germany are the hartz reforms ( 2003 – 2005 ), wage moderation, the “ kurzarbeit ” short time working scheme, and the apprenticeship vocational training programme. all of these include elements that promote the fall in youth unemployment. hartz reforms aimed at both labour supply and demand the hartz reforms included a number of measures aiming at both labour supply and demand. by tightening the eligibility of and reducing the duration and level of unemployment benefits, as well as with different types of low - wage jobs and wage subsidies the german government aimed at activating unemployed workers. labor market regulations were reduced, by altering employment protection and the rules for temporary contracts. opening clauses to labour contracts were introduced, to bring flexibility in times of trouble. these concern flexibility of working time and wages. wages have grown moderately wages have grown moderately in recent years in germany, which has contributed to the fall in unemployment. the increase in low - wage jobs has in part supported the employment of low productivity workers, often the young. “ kurzarbeit ” has had a positive employment effect during the crisis beneficial especially for the employment of workers on permanent contracts, typically older workers whereas labour input adjustment has been made through the reduction of ( temporary ) workers in many countries, in germany the adjustment has been made largely in hours per worker with the so called “ kurzarbeit ” short time