##ation process should be supported by easing labour cost pressures and the past monetary policy tightening gradually feeding through to consumer prices. most measures of longer - term inflation expectations stand at around 2 per cent. risk assessment the risks to economic growth remain tilted to the downside. lower confidence could prevent consumption and investment from recovering as fast as expected. this could be amplified by sources of geopolitical risk, such as russia's unjustified war against ukraine and the tragic conflict in the middle east, which could also disrupt energy supplies and global trade. lower demand for euro area exports due, for instance, to a 2 / 4 bis - central bankers'speeches weaker world economy or an escalation in trade tensions between major economies would further weigh on euro area growth. growth could also be lower if the lagged effects of monetary policy tightening turn out stronger than expected. growth could be higher if the world economy grows more strongly than expected or if easier financing conditions and declining inflation lead to a faster rebound in consumption and investment. inflation could turn out higher than anticipated if wages or profits increase by more than expected. upside risks to inflation also stem from the heightened geopolitical tensions, which could push energy prices and freight costs higher in the near term and disrupt global trade. moreover, extreme weather events, and the unfolding climate crisis more broadly, could drive up food prices. by contrast, inflation may surprise on the downside if low confidence and concerns about geopolitical events prevent consumption and investment from recovering as fast as expected, monetary policy dampens demand more than expected, or if the economic environment in the rest of the world worsens unexpectedly. financial and monetary conditions shorter - term market interest rates have declined since our september meeting, owing mainly to weaker news on the euro area economy and the further fall in inflation. while financing conditions remain restrictive, the average interest rates on new loans to firms and on new mortgages were down slightly in august, to 5. 0 per cent and 3. 7 per cent respectively. credit standards for business loans were unchanged in the third quarter, as reported in our latest bank lending survey, after more than two years of progressive tightening. moreover, demand for loans by firms rose for the first time in two years. overall lending to firms continues to be subdued, growing at an annual rate of 0. 8 per cent in august. credit standards for mortgages eased for the third quarter in a row, owing especially to greater competition among banks. lower interest rates and better housing market

christine lagarde : ecb press conference - introductory statement introductory statement by ms christine lagarde, president of the european central bank, and mr luis de guindos, vice - president of the european central bank, ljubljana, 17 october 2024. * * * good afternoon, the vice - president and i welcome you to our press conference. i would like to thank governor vasle for his kind hospitality and express our special gratitude to his staff for the excellent organisation of today's meeting of the governing council. the governing council today decided to lower the three key ecb interest rates by 25 basis points. in particular, the decision to lower the deposit facility rate – the rate through which we steer the monetary policy stance – is based on our updated assessment of the inflation outlook, the dynamics of underlying inflation and the strength of monetary policy transmission. the incoming information on inflation shows that the disinflationary process is well on track. the inflation outlook is also affected by recent downside surprises in indicators of economic activity. meanwhile, financing conditions remain restrictive. inflation is expected to rise in the coming months, before declining to target in the course of next year. domestic inflation remains high, as wages are still rising at an elevated pace. at the same time, labour cost pressures are set to continue easing gradually, with profits partially buffering their impact on inflation. we are determined to ensure that inflation returns to our two per cent medium - term target in a timely manner. we will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim. we will continue to follow a data - dependent and meetingby - meeting approach to determining the appropriate level and duration of restriction. in particular, our interest rate decisions will be based on our assessment of the inflation outlook in light of the incoming economic and financial data, the dynamics of underlying inflation and the strength of monetary policy transmission. we are not pre - committing to a particular rate path. the decisions taken today are set out in a press release available on our website. i will now outline in more detail how we see the economy and inflation developing and will then explain our assessment of financial and monetary conditions. economic activity the incoming information suggests that economic activity has been somewhat weaker than expected. while industrial production has been particularly volatile over the summer months, surveys indicate that manufacturing has continued to contract. for services, surveys show an uptick in august, likely supported by a strong summer tourism season, but the latest data point to more sluggis