mario draghi : ecb press conference – introductory statement introductory statement by mr mario draghi, president of the european central bank, and mr vitor constancio, vice - president of the european central bank, frankfurt am main, 2 august 2012. * * * ladies and gentlemen, the vice - president and i are very pleased to welcome you to our press conference. 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 rehn. based on our regular economic and monetary analyses, we decided to keep the key ecb interest rates unchanged, following the decrease of 25 basis points in july. as we said a month ago, inflation should decline further in the course of 2012 and be below 2 % again in 2013. consistent with this picture, the underlying pace of monetary expansion remains subdued. inflation expectations for the euro area economy continue to be firmly anchored in line with our aim of maintaining inflation rates below, but close to, 2 % over the medium term. at the same time, economic growth in the euro area remains weak, with the ongoing tensions in financial markets and heightened uncertainty weighing on confidence and sentiment. a further intensification of financial market tensions has the potential to affect the balance of risks for both growth and inflation on the downside. the governing council extensively discussed the policy options to address the severe malfunctioning in the price formation process in the bond markets of euro area countries. exceptionally high risk premia are observed in government bond prices in several countries and financial fragmentation hinders the effective working of monetary policy. risk premia that are related to fears of the reversibility of the euro are unacceptable, and they need to be addressed in a fundamental manner. the euro is irreversible. in order to create the fundamental conditions for such risk premia to disappear, policymakers in the euro area need to push ahead with fiscal consolidation, structural reform and european institution - building with great determination. as implementation takes time and financial markets often only adjust once success becomes clearly visible, governments must stand ready to activate the efsf / esm in the bond market when exceptional financial market circumstances and risks to financial stability exist – with strict and effective conditionality in line with the established guidelines. the adherence of governments to their commitments and the fulfilment by the efsf / esm of their role are necessary conditions. the governing council, within its mandate to maintain price stability

regulation can unleash innovation. potential first - mover advantages are another incentive to reduce carbon emissions. customers are looking to reduce their carbon footprint along the value chain. that means that the air cargo industry will have to adapt to their customers ’ ambitions to reduce carbon emissions. acting now can give you an edge over your competitors. 3 decarbonising our industries let us take a look at the bigger picture. i have singled out the aviation industry, but ultimately, all industries must move towards net zero. moving carbon - intensive industries towards a low carbon future is at the heart of the transformation. the real economy – small and medium - sized enterprises as well as large multinational companies – need to be the engine driving the green transformation. to decarbonise our economies we need climate - neutral innovations. sustainable aviation fuels are just one example here. it is up to you to develop and implement these innovations. 4 financing the transformation i understand that this comes with a hefty price tag. there is no such thing as a free lunch. so who is going to foot the bill? how can we finance the transformation? this will need a division of labour between the public and the private sector. the public sector takes on parts of the risk. the private sector pitches in. mobilising and directing finance towards sustainable investments is key. over the past years, there has been growing interest in sustainable finance from wholesale and retail investors. demand is far outstripping supply. for instance, the eu ’ s first green bond in october 2021 was hugely oversubscribed. it raised 12 billion euro and attracted record demand of 135 billion euro. [ 8 ] green and sustainable finance resonates with investors. the problem is that it is often not clear what qualifies as green and what doesn ’ t. this ambiguity leaves the door open to greenwashing. investors need to be certain that their money is actually contributing to the transformation. transparency is key. three things are essential to boost transparency : first, a clear definition of sustainable activities. second, good data based on internationally harmonised disclosure requirements, so that companies and financial institutions know which climate - related data they are expected to disclose. and third, financial product standards that can be reviewed by qualified and independent bodies. it is encouraging to see work underway on all these fronts. but this is just the first step. companies need to deliver on their net zero commitments. climate transition plans should explain how companies will adapt as we move towards a