london, i said that one of the mistakes many people make is to underestimate how much political capital has already been invested in the euro. i was very much aware of that fact. just before i made that statement, the political leaders had fully committed themselves to the euro at the european summit, within the scope of which the banking union was created. ” are the omts some kind of nuclear bomb, a threat that will never be carried out? “ the markets reacted in a way that made it unnecessary to use the programme. the spreads between the interest rates [ on bonds ] of southern euro area countries and germany narrowed sharply. that was something that could not have been achieved by any other monetary policy measure. ” were you surprised by this effect? “ by the magnitude of the effect? yes, certainly. we were all surprised. ” or were you relieved that you had merely had to promise action without following through with it? “ in order to be credible, we also had to be sure that we could actually use the instrument. we were not bluffing, most certainly not. ” the other side to the coin is that you bought so much time for politicians that they no longer needed to implement reforms so rapidly. do you also see this other side? “ yes and no. we have a mandate to safeguard price stability. we are not responsible for how politicians make use of the time they have. i do not want to mix the responsibilities of the central bank with those of governments. but look at the extent of the reforms undertaken by governments since 2012. you will then need to admit that considerable progress has been made. take spain, for example, which has restructured its banking sector and reformed the labour market. portugal is another example and ireland yet another. and even in greece progress has been remarkable. ” you have said repeatedly that the euro is an irreversible project. it is understandable that you say that, but is this not something for politicians to decide? “ our mandate is to ensure price stability. there was more than enough evidence that a collapse of the euro would endanger price stability, and therefore our action was squarely within our mandate. ” you saved the euro. in doing so, did you not take a political decision? “ no, certainly not. the issue is by no means political. my statement in july 2012 was aimed at price stability. there was unjustified uncertainty about the future of the euro, not political uncertainty but a financial one.

also broadly reflected in the december 2017 eurosystem staff macroeconomic projections for the euro area, which foresee annual hicp inflation at 1. 5 % in 2017, 1. 4 % in 2018, 1. 5 % in 2019 and 1. 7 % in 2020. compared with the september 2017 ecb staff macroeconomic projections, the outlook for headline hicp inflation has been revised up, mainly reflecting higher oil and food prices. turning to the monetary analysis, broad money ( m3 ) continues to expand at a robust pace, with an annual rate of growth of 5. 0 % in october 2017, from 5. 2 % in september, reflecting the impact of the ecb ’ s monetary policy measures and the low opportunity cost of holding the most liquid deposits. accordingly, the narrow monetary aggregate m1 continued to be the main contributor to broad money growth, expanding at an annual rate of 9. 4 % in october, after 9. 8 % in september. the recovery in the growth of loans to the private sector observed since the beginning of 2014 is proceeding. the annual growth rate of loans to non - financial corporations increased to 2. 9 % in october 2017, after 2. 4 % in september, while the annual growth rate of loans to households remained stable at 2. 7 %. the pass - through of the monetary policy measures put in place since june 2014 continues to significantly support borrowing conditions for firms and households, access to financing ‒ notably for small and medium - sized enterprises ‒ and credit flows across the euro area. to sum up, a cross - check of the outcome of the economic analysis with the signals coming from the monetary analysis confirmed the need for an ample degree of monetary accommodation to secure a sustained return of inflation rates towards levels that are below, but close to, 2 %. in order to reap the full benefits from our monetary policy measures, other policy areas must contribute decisively to strengthening the longer - term growth potential and reducing vulnerabilities. the implementation of structural reforms in all euro area countries needs to be substantially stepped up to increase resilience, reduce structural unemployment and boost euro area productivity and growth potential. regarding fiscal policies, the increasingly solid and broad - based expansion strengthens the case for rebuilding fiscal buffers. this is particularly important in countries where government debt remains high. all countries would benefit from intensifying efforts towards achieving a more growth - friendly composition of public finances. a full, transparent and consistent implementation of the stability and growth pact and of the