staff compared to earlier projections mainly reflects the carry - over effect of weaker economic developments in 2004 rather than a downward revision of the expected pick - up of activity this year. there are some signs of an upturn in investment. as far as consumption is concerned, we expect that it will increase in line with real disposable income, which is projected to rise by about 1. 4 % in 2005. despite the increase in oil prices? oil prices are assumed to decrease gradually in the future as implied by futures markets. we are making no assumptions about other factors, such as an improvement in confidence, that could positively influence consumer behaviour. of course, if oil prices turn out to be higher than currently envisaged, they would dampen disposable income and consumption growth. what constitutes a natural interest rate for the ecb? the concept of a natural interest rate refers to an equilibrium real interest rate that reflects productivity and population growth. although most recent analyses seem to indicate that in the euro area it lies within a corridor of 2 % to 3 %, i would not be surprised if the lower bound of the estimated range is revised downwards as a result of the lower growth in productivity in the euro area during the past ten years. owing to the high level of uncertainty surrounding the estimates of the natural interest rate, great caution is called for when using them. the natural interest rate does not constitute an intermediate objective of the ecb ’ s monetary policy. competitiveness is improving in germany, including as a result of wage cuts. is this a “ recipe ” for other countries, like italy? germany has indeed succeeded in significantly improving its international competitiveness. without giving advice to individual countries, i must stress that it is essential to improve competitiveness to effectively compete in the global economy. italy ’ s competitiveness has declined during the past five years. it is therefore important to reverse this developing trend. how? for example, by increasing productivity growth and enhancing market flexibility. the wall street journal views italy as a “ fortress ” because of its restrictive attitude towards imports. do you support this policy, or is it better to be more competitive? past experience has shown that protectionism is not effective and can never be an appropriate response in the long term. it may even be damaging in the short term, if it leads other countries to introduce protectionist measures as well. besides, such measures are not in accordance with the european union ’ s fundamental principle of an open and competitive economy. competition is

benoit cœure : taking stock of the global role of the renminbi speech by mr benoit cœure, member of the executive board of the european central bank, at the european - chinese banking day, frankfurt am main, 17 november 2014. * * * dear ladies and gentlemen, it is an honour to be invited here to the european - chinese banking day, part of the frankfurt euro finance week, and i would like to thank my hosts for giving me the opportunity to share some thoughts on the issue of yuan ( or rmb ) clearing. clearly, the increasing importance of the chinese economy and its currency over the last decades brings many new challenges, some of which also encompass international payment activities. as a major economy, the euro area is naturally affected by this process. the rise of china has been astonishing. since 1990, its weight in global gdp has increased from just below 2 % to over 13 % this year, and is projected to surpass 15 % before 2020. in ppp terms, china ’ s share in the global gdp is, as of this year, even larger than that of the us 1. this rapid economic development would not have been possible without china also becoming one of the world ’ s main trading nations, together with the euro area and the us. this economic prowess is also gradually translating itself into a greater presence in the financial sphere. china has liberalised cross - border financial transactions, first those related to trade and direct investment, but increasingly also those related to portfolio investment. approved investments under the different schemes that allow domestic and foreign institutional investors to make cross - border investments in and out of china have been rising steadily, although, so far, they amount only to about 2 % of china ’ s gdp. however, we should not forget that financial liberalisation is an ongoing process, which is still not complete. additionally, in the last few years, central banks across the world have started to hold onshore chinese renminbi ( cny ) in their reserves portfolios, usually with the expectation that cny may become a reserve currency in the coming years. many others indicate interest in reserve asset diversification into cny once china ’ s onshore market opens up further. this is an issue that the eurosystem will also have to further reflect on in the future. also, the shanghai – hong kong stock connect programme, which allows institutional and private investors from mainland china to invest up to a certain quota in hong kong and vice versa, is