guidance on the key ecb interest rates. in any event, the governing council stands ready to adjust all of its instruments as appropriate to ensure that inflation continues to move towards the governing council ’ s inflation aim in a sustained manner. let me now explain our assessment in greater detail, starting with the economic analysis. euro area real gdp increased by 0. 4 %, quarter on quarter, in the second quarter of 2018, following growth at the same rate in the previous quarter. despite some moderation following the strong growth performance in 2017, the latest economic indicators and survey results overall confirm ongoing broad - based growth of the euro area economy. our monetary policy measures continue to underpin domestic demand. private consumption is supported by ongoing employment gains, which, in turn, partly reflect past labour market reforms, and by rising wages. business investment is fostered by the favourable financing conditions, rising corporate profitability and solid demand. housing investment remains robust. in addition, the expansion in global activity is expected to continue, supporting euro area exports. this assessment is broadly reflected in the september 2018 ecb staff macroeconomic 1 / 3 bis central bankers'speeches projections for the euro area. these projections foresee annual real gdp increasing by 2. 0 % in 2018, 1. 8 % in 2019 and 1. 7 % in 2020. compared with the june 2018 eurosystem staff macroeconomic projections, the outlook for real gdp growth has been revised down slightly for 2018 and 2019, mainly due to a somewhat weaker contribution from foreign demand. the risks surrounding the euro area growth outlook can still be assessed as broadly balanced. at the same time, risks relating to rising protectionism, vulnerabilities in emerging markets and financial market volatility have gained more prominence recently. according to eurostat ’ s flash estimate, euro area annual hicp inflation was 2. 0 % in august 2018, down from 2. 1 % in july. on the basis of current futures prices for oil, annual rates of headline inflation are likely to hover around the current level for the remainder of the year. while measures of underlying inflation remain generally muted, they have been increasing from earlier lows. domestic cost pressures are strengthening and broadening amid high levels of capacity utilisation and tightening labour markets, which is pushing up wage growth. uncertainty around the inflation outlook is receding. looking ahead, underlying inflation is expected to pick up towards the end of the year and thereafter to increase gradually over the medium term, supported by our monetary

verify an applicant ’ s identity and make inferences about the applicant ’ s overall financial health. for example, a business loan applicant could submit information such as shipping data or customer reviews as additional input to more traditional data sources. with this additional information, the bank would have a more complete picture of an applicant ’ s day - to - day activity and overall financial capacity, and potentially a greater ability to provide credit to customers, including some who might have been otherwise denied a loan based on traditional data. fintech firms are also finding ways to use banks ’ data, in some cases without entering into an explicit partnership with the bank. with customers ’ permission, fintech firms have increasingly turned to data aggregators to “ screen scrape ” information from financial accounts. in such cases, data aggregators collect and store online banking logins and passwords provided by the bank ’ s customers and use them to log directly into the customer ’ s banking account. this information can be used to provide consumers with convenient real - time snapshots of their financial information across multiple banks and accounts. 1 / 5 bis central bankers'speeches these examples highlight that there is a balance that needs to be achieved in this innovative environment. 2 on the one hand, new technologies have enabled banks and other firms to find different ways of meeting consumers ’ demand for speed and convenience. on the other hand, these same technologies raise new considerations about data security and safety, as well as consumer privacy and protection. policymakers and the financial industry must assure that enhanced convenience and speed in financial services do not undermine the safety, security, and reliability of those services. retail payments innovation technology is also shaping changes in retail payments. as with retail banking, retail payments will need to evolve to meet consumer expectations of constant connectivity and instant access while assuring security and privacy. it is not news that consumers ’ lives, including the way they pay, are now intertwined with mobile phone usage. while the overall amount of time we spend on our phones continues to grow, the duration of individual phone sessions is actually shrinking. in late 2015, google estimated that the average mobile session lasts only 70 seconds, and may be repeated dozens of times per day. 3 as a result, payment innovators have had to create new ways to move money that are not only fast and mobile - focused, but also sufficiently “ frictionless ” that consumers can now fit commerce into these brief interludes. this development has ushered in a world of multiple smartphone apps that allow for