deposit facility rate implies that, should the ecb adjust these key interest rates, the average funding conditions under the programme would be correspondingly adjusted for banks, thus helping to align this programme with the broader monetary policy stance. the governing council made clear that the modalities of tltro iii would take into account a thorough assessment of the bank - based transmission channel of monetary policy, as well as developments in the economic outlook. the recent deterioration in the economic outlook prompted us to ease several of the terms of the new operations. the governing council decided to eliminate the 10 basis point spread over the key policy rates entailed in the initial pricing of the operations. in addition, the maturity of the operations was extended from two to three years, and an early repayment option after two years was introduced. the adjustments to the tltro iii parameters signal that the governing council can act in an agile manner and fine - tune its monetary policy instruments, as needed, to ensure that they are efficient, effective and proportionate to the risks to price stability. 1 / 3 bis central bankers'speeches we believe that these changes represent a significant easing of banks ’ medium - term funding conditions, which in turn should contribute to improving the lending conditions banks offer to the real economy. the more accommodative pricing should strengthen support for bank funding, so that banks continue to offer loans to firms and households on favourable terms. the extended maturity of tltro iii will be better aligned with bank - based financing of investment projects, thereby further supporting banks ’ financing to the real economy. finally, in view of the lengthened maturity, the option to voluntarily repay the amounts borrowed before maturity at a quarterly frequency will provide greater flexibility for banks ’ funding plans. the two - tier system let me now turn to the second measure. banks in the euro area continue to benefit from the negative interest rate policy through the larger intermediation volumes and lower credit risk for borrowers associated with more favourable macroeconomic developments. this has helped support bank profitability across the euro area since the deposit facility rate turned negative in 2014. in addition, banks have been able to generate higher non - interest income as the compression of yields is reflected in higher asset valuations. banks ’ funding costs in wholesale markets have also decreased, mitigating the impact of lower rates on net interest income. however, the negative interest rate policy also entails costs for banks, and these are likely to increase the longer negative rates are in place,

jerome h powell : opening remarks for the fed listens panel on the covid - 19 pandemic opening remarks ( via webcast ) by mr jerome h powell, chair of the board of governors of the federal reserve system, at " a fed listens event : how is covid - 19 affecting your community? ", sponsored by the board of governors of the federal reserve system, washington dc, 21 may 2020. * * * good afternoon. i just want to say a few words of welcome and thank everyone for being here — albeit in much different circumstances than would otherwise be expected. we ’ ve held many fed listens events over the past 16 months, and it ’ s important to note that these conversations aren ’ t just a nice way to talk to people from around the country, although they are that. what they provide — what you provide — is insight that we just can ’ t get anywhere else. you add depth and definition to the flood of data that flows through the fed each day. you give us perspective on the economic realities that don ’ t show up on a spreadsheet. you help us see those complex sets of data that analyze the american economy through the eyes of the people, businesses, and communities that make up the american economy. and that information is very helpful to us as we make our policy decisions. so this is a valuable exercise for us. and an enjoyable one as well, so we truly do appreciate it on a number of levels. the reserve banks are also continuing to host conversations in communities across the country to help capture economic realities on the ground. we are in the midst of an economic downturn without modern precedent. it was sudden, and it is severe. it has already erased the job gains of the past decade and has inflicted acute pain across the country. and while the burden is widespread, it is not evenly spread. those taking the brunt of the fallout are those least able to bear it. the pain of this downturn is compounded by the upending of normal life, along with great uncertainty about the future. in the best of times, predicting the path of the economy with any certainty is difficult. john kenneth galbraith famously said that economic forecasting exists to make astrology look respectable. we are now experiencing a whole new level of uncertainty, as questions only the virus can answer complicate the outlook. policies that address the resumption of economic activity are the province of elected officials at all levels of government