also very important not to make mistakes during an economic slowdown. would repealing the labour reform be such a mistake? as ecb vice - president it ’ s not my place to comment on a specific economic policy in an individual country. in general, it ’ s important to be particularly careful during a downturn in any country. there ’ s a difference between making an economic policy mistake during a period of strong global economic growth and making the same mistake during a period of uncertainty. the labour market isn ’ t uniform. its foundations are more or less the same, but there are different levels of productivity, capacity, and supply and demand across professions and regions. that ’ s why measures with pros and cons, such as the minimum wage, can have a positive impact, negative impact or no impact on employment depending on the sector we look at. brexit is one of the risks you have warned about the most. how is it being dealt with 1 / 7 bis central bankers'speeches now? brexit isn ’ t good news. a no - deal brexit was avoided after the election in the united kingdom, but the negotiation period is going to be very short. the uk economy remains extremely important for continental europe because it ’ s the second largest after germany. i hope that there will be cooperation and a sense of understanding between the different sides. the first stage will be the trade agreement, which is complicated. i ’ m confident that, if they reach an agreement in this field, there will also be an agreement on financial regulation and regulatory harmonisation, as that would be the best outcome for everybody. there are other major sources of global uncertainty, like the trade war, and now the coronavirus... the stabilisation of the european and global economy is a result of the lower perceived risk of a trade war and the fact that a no - deal brexit was avoided. with risks like the coronavirus there is always a high level of uncertainty at first, until more details become available and we know how it is transmitted, what the mortality rate is, etc. we will begin to see the real impact once this period of heightened uncertainty is over. do you agree with the view that the ecb has created a bubble in the stock market and the bond market? no, i don ’ t agree. the equity market in europe is not overvalued. if you look at the risk premium of these assets and compare it with the level

– just like any form of payment – would have to respect the rules on countering money laundering, the financing of terrorism and tax evasion. this would enable public authorities to combat any illegal activity more effectively. to summarise, the digital euro would still be a euro, only in digital form. it would both shape and promote the digitalisation of payments, while reducing the associated risks. this would in turn support the ongoing digitalisation and modernisation of the european economy. 9 why might we need a digital euro? a digital euro would be critically important in a number of scenarios, which are analysed in our report. in particular, it would be needed in the event that citizens become reluctant to use cash as they go digital. this is not the situation we face today : cash is still the most common way of making retail payments in the euro area. however, its role as a payment instrument is diminishing – in some countries rapidly so – as consumers are increasingly paying electronically : 10 as a proportion of all physical retail payments, cash payments decreased from 79 % in 2016 to 73 % in 2019. this trend has accelerated during the pandemic – with a vast majority of consumers expecting to continue using digital payments as often as they do now, or even to use them more often in the future. 11 and because of this trend, we may see a further increase in the uptake of international card schemes and solutions such as payment wallets and apps developed by large technology firms. a digital euro would ensure that even in a situation where there is rapid digitalisation in the world of payments, sovereign money remains at the core of the european payment system. this would contribute to financial inclusion. it would also shield us from the risk that a private or public digital means of payment issued and controlled from outside the euro area could largely displace existing domestic means of payment. such a development would raise regulatory and financial stability concerns and could even put europe ’ s monetary and financial sovereignty at risk. how could a digital euro be introduced? legal considerations and possible challenges a digital euro would raise legal, technological and policy questions that we need to address. 2 / 4 bis central bankers'speeches let me start with the legal basis. today, only euro banknotes and coins are legal tender under eu primary law. this means they can be used to pay anywhere in the euro area. 12 therefore, a key issue discussed in the report is the importance for a digital euro to have legal tender status.