gertrude tumpel - gugerell : opening statement at the press briefing for the signing of t2s memorandum of understanding speech by ms gertrude tumpel - gugerell, member of the executive board of the european central bank, at the signing ceremony for the t2s memorandum of understanding, frankfurt, 16 july 2009. * * * dear ladies and gentlemen, it is a pleasure to welcome you today and i would like to thank you for your interest in this project. a year ago, the governing council gave green light to launch t2s. the purpose of the project is to create one single settlement platform, a harmonized settlement process throughout europe and a common pool of securities. this should create efficiency gains, further financial market integration and the completion of a single market for financial services as set out in the lisbon agenda. with t2s we continue our efforts in building up stable and harmonized infrastructures to the benefit of financial stability. stable and efficient infrastructures have been fundamental during the financial crisis, dampening the destabilizing shocks to the financial system and prevented further damaging contagion. during the last year much has been achieved : i would very much like to thank all that have supported us in this endeavour – all market participants in the t2s advisory group and its sub - structures and particularly the csds. there are only a few months left in the specification phase before the eurosystem will start the work on developing the new settlement platform early next year. today, the eurosystem will sign a memorandum of understanding with 27 csds, which will set out the mutual relationship between the eurosystem and the csds in preparation of the next important stage of the project. i would like to take the opportunity to give you a brief update on the status of the project. one of the most important workstreams in the coming months is the finalisation of the technical documentation. the last version of the user requirements documentation has just been published on the ecb website, and in its last meeting the advisory group agreed that it should now be largely “ frozen ”. we are currently in the process of updating the final version of the general functional specification, the draft of which was already published earlier this year for discussion with the market. and we are now working on the other technical documentation, in particular the user detailed functional specification. another important workstream is the preparation work for the formal contractual relations between the eurosystem and the csds, which

very weak. according to the survey data for the last two months, there are tentative signs of a stabilisation in economic activity at a low level. looking ahead, we expect the euro area economy to recover very gradually in the course of 2012. the very low short - term interest rates and all the measures taken to foster the proper functioning of the euro area financial sector are lending support to the euro area economy. moreover, stress in financial markets has diminished in response to our monetary policy measures, but also in response to the progress made towards a stronger euro area governance framework and intensified fiscal consolidation in several euro area countries. however, subdued global demand growth, the remaining tensions in euro area sovereign debt markets and their impact on credit conditions, as well as the process of balance sheet adjustment in the financial and non - financial sectors, continue to dampen the underlying growth momentum. this outlook is subject to downside risks. they notably relate to tensions in euro area debt markets and their potential spillover to the euro area real economy. downside risks also relate to possible adverse developments in the global economy, higher than assumed increases in commodity prices, protectionist pressures and the potential for a disorderly correction of global imbalances. bis central bankers ’ speeches euro area annual hicp inflation was 2. 7 % in january 2012, according to eurostat ’ s flash estimate, unchanged from december. the average inflation rate for 2011 was 2. 7 %, mainly driven by higher energy and other commodity prices. looking ahead, inflation is likely to stay above 2 % for several months to come, before declining to below 2 %. this pattern reflects the expectation that, in an environment of weak growth in the euro area and globally, underlying price pressures in the euro area should remain limited. risks to the medium - term outlook for price developments remain broadly balanced. on the upside, they relate to higher than assumed increases in indirect taxes and administered prices, as well as increases in commodity prices. the main downside risks relate to the impact of weaker than expected growth in the euro area and globally. the monetary analysis indicates that the underlying pace of monetary expansion remains subdued. the annual growth rate of m3 decreased to 1. 6 % in december 2011, after 2. 0 % in november, reflecting a further weakening of monetary dynamics towards the end of the year. the annual growth rates of loans to non - financial corporations and loans to households, adjusted for loan sales and securitisation, also decreased further in december, and