mario draghi : ecb press conference – introductory statement introductory statement by mr mario draghi, president of the european central bank, frankfurt am main, 7 november 2013. * * * ladies and gentlemen, i am very pleased to welcome you to our press conference. i will now report on the outcome of today ’ s meeting of the governing council, during which we took a number of decisions on key ecb interest rates, forward guidance and liquidity provision. first, based on our regular economic and monetary analyses, we decided to lower the interest rate on the main refinancing operations of the eurosystem by 25 basis points to 0. 25 % and the rate on the marginal lending facility by 25 basis points to 0. 75 %. the rate on the deposit facility will remain unchanged at 0. 00 %. these decisions are in line with our forward guidance of july 2013, given the latest indications of further diminishing underlying price pressures in the euro area over the medium term, starting from currently low annual inflation rates of below 1 %. in keeping with this picture, monetary and, in particular, credit dynamics remain subdued. at the same time, inflation expectations for the euro area over the medium to long term continue to be firmly anchored in line with our aim of maintaining inflation rates below, but close to, 2 %. such a constellation suggests that we may experience a prolonged period of low inflation, to be followed by a gradual upward movement towards inflation rates below, but close to, 2 % later on. accordingly, our monetary policy stance will remain accommodative for as long as necessary. it will thereby also continue to assist the gradual economic recovery as reflected in confidence indicators up to october. second, following today ’ s rate cut, the governing council reviewed the forward guidance provided in july and confirmed that it continues to expect the key ecb interest rates to remain at present or lower levels for an extended period of time. this expectation continues to be based on an overall subdued outlook for inflation extending into the medium term, given the broad - based weakness of the economy and subdued monetary dynamics. third, we continue to monitor closely money market conditions and their potential impact on our monetary policy stance. we are ready to consider all available instruments and, in this context, we decided today to continue conducting the main refinancing operations ( mros ) as fixed rate tender procedures with full allotment for as long as necessary, and at least until the end of the 6th maintenance

would rather have a capital market where the insurance companies play a bigger role. and i am sure you, actuaries, will play a very big role in that. in short, banks, by their very nature, have a lot more resources than insurance companies, but they also are much more limited in what they can do by the very nature of their funding sources. so, i will cut through some parts of my speech because i am sure that you are in a hurry to be sworn in. i was told you have 400 members. and just like us, as i already said, you must want your decisions to be based on data. so, the question we ask ourselves always in the bsp is : how else can we get it? how else can we extract as much as we can from our data? and, in that sense, you probably have exactly the same concerns that we have. i will just tell you that, okay, we are very confident. although i am less than a hundred percent sure that, given what we are doing, we can support the nascent economic growth. what have we done? we have raised interest rates. but fortunately, we seem to be right that high interest rates will not kill the economy. and then, we hope that with the interest rate adjustments, inflation will come back to normal by the middle of next year, unless there are new supply shocks, new surprises. and then by 2024, hopefully, we will be back to normal inflation rates again. i heard the speech of the outgoing president. i congratulate you on a job well done. and it seems to me that every society has exactly the same problem, right? some are happy ; some are not happy. but in the end, the society survives and prospers. by the way, my other impression is you seem to be better funded than economists. you have nicer meetings, okay? so, congratulations to all the members, especially the new officers, and it is my great privilege to be able to swear you in. magandang gabi sa inyong lahat. 3 / 3 bis - central bankers'speeches