mario draghi : ecb press conference – introductory statement introductory statement by mr mario draghi, president of the european central bank, frankfurt am main, 4 december 2014. * * * ladies and gentlemen, the vice - president and i are very pleased to welcome you to the first press conference in our new premises. we will now report on the outcome of today ’ s meeting of the governing council, which was also attended by the commission vice - president, mr dombrovskis. based on our regular economic and monetary analyses, and in line with our forward guidance, we decided to keep the key ecb interest rates unchanged. as regards our nonstandard monetary policy measures, we have started purchasing covered bonds and asset - backed securities. these purchase programmes will last for at least two years. next week, we will conduct the second targeted longer - term refinancing operation, to be followed by six further operations until june 2016. taken together, our measures will have a sizeable impact on our balance sheet, which is intended to move towards the dimensions it had at the beginning of 2012. in the coming months, our measures will further ease the monetary policy stance more broadly, support our forward guidance on the key ecb interest rates and reinforce the fact that there are significant and increasing differences in the monetary policy cycle between major advanced economies. however, the latest euro area macroeconomic projections indicate lower inflation, accompanied by weaker real gdp growth and subdued monetary dynamics. in this context, early next year the governing council will reassess the monetary stimulus achieved, the expansion of the balance sheet and the outlook for price developments. we will also evaluate the broader impact of recent oil price developments on medium - term inflation trends in the euro area. should it become necessary to further address risks of too prolonged a period of low inflation, the governing council remains unanimous in its commitment to using additional unconventional instruments within its mandate. this would imply altering early next year the size, pace and composition of our measures. in response to the request of the governing council, ecb staff and the relevant eurosystem committees have stepped up the technical preparations for further measures, which could, if needed, be implemented in a timely manner. all of our monetary policy measures are geared towards underpinning the firm anchoring of medium to long - term inflation expectations, in line with our aim of achieving inflation rates below, but close to, 2 %, and contribute to a return of inflation rates towards that level. let me now

explain our assessment in greater detail, starting with the economic analysis. real gdp in the euro area rose by 0. 2 %, quarter on quarter, in the third quarter of this year. this was in line with earlier indications of a weakening in the euro area ’ s growth momentum, leading to a downward revision of the outlook for euro area real gdp growth in the most recent forecasts. the latest data and survey evidence up to november confirm this picture of a weaker growth profile in the period ahead. at the same time, the outlook for a modest economic recovery remains in place. on the one hand, domestic demand should be supported by our monetary policy measures, the ongoing improvements in financial conditions, the progress made in fiscal consolidation and structural reforms, and significantly lower energy prices supporting real disposable income. furthermore, demand for exports should benefit from the global recovery. on the other hand, the recovery is likely to continue to be dampened by high unemployment, sizeable unutilised capacity, and the necessary balance sheet adjustments in the public and private sectors. bis central bankers ’ speeches these elements are reflected in the december 2014 eurosystem staff macroeconomic projections for the euro area, which foresee annual real gdp increasing by 0. 8 % in 2014, 1. 0 % in 2015 and 1. 5 % in 2016. compared with the september 2014 ecb staff macroeconomic projections, the projections for real gdp growth have been revised substantially downwards. downward revisions were made to the projections for both domestic demand and net exports. the risks surrounding the economic outlook for the euro area are on the downside. in particular, the weak euro area growth momentum, alongside high geopolitical risks, has the potential to dampen confidence and especially private investment. in addition, insufficient progress in structural reforms in euro area countries constitutes a key downward risk to the economic outlook. according to eurostat ’ s flash estimate, euro area annual hicp inflation was 0. 3 % in november 2014, after 0. 4 % in october. compared with the previous month, this mainly reflects a stronger fall in energy price inflation and a somewhat lower annual increase in services prices. taking into account the current environment of very low rates of inflation, it will be important to assess the broader impact of recent oil price developments on mediumterm inflation trends and to avoid spillovers to inflation expectations and wage formation. against the background of recent oil price developments, it is crucial to recall that forecasts and projections are based on technical