peter praet : recent economic developments in the euro area remarks by mr peter praet, member of the executive board of the european central bank, at the febelfin working group of bank economists, brussels, 16 november 2017. * * * the ecb has introduced several monetary policy measures since june 2014, which have played a crucial role in supporting the economy and have been demonstratively effective in preventing a period of disinflation from slipping into one of outright deflation. more than three years later, the risks of deflation have mostly disappeared due to the effective transmission of our policy measures to the real economy, which is clearly evidenced by a broad - based cyclical recovery with solid momentum. this lays the groundwork for a return of inflation to below, but close to, 2 % over the medium term. overall, inflation developments, despite the solid growth, remain subdued. convergence of inflation towards our aim therefore remains conditional on a substantial degree of monetary policy accommodation. before focusing more on price dynamics and monetary policy, let me make some observations about the latest economic developments. real gdp in the euro area has expanded for 18 consecutive quarters, growing by 2. 5 % year on year during the third quarter of 2017, according to eurostat – a rate that exceeded our projection at the start of the year. this compares with the latest potential growth estimates for the euro area of just over 1. 4 %. 1 the latest survey data point to a strong fourth quarter. the composite output purchasing managers ’ index – which has a high correlation with growth in the euro area – remains above its long - term average and is close to six - year highs. overall, survey data continue to point to growth in the quarters ahead. moreover, eurostat ’ s economic sentiment indicator is near a ten - year high. the ongoing recovery has led to solid employment gains. the number of people employed in the euro area has increased by almost 7 million since hitting a trough in mid - 2013. this means that all of the employment losses recorded during the crisis have been offset. additionally, the unemployment rate is now at its lowest level in eight years and continues to decline, notwithstanding an increase in labour force participation. employment growth, together with the gradual increase in employee compensation, supports households ’ disposable income and is underpinning solid consumption dynamics. robust consumer spending is driven by buoyant sentiment, favourable bank lending conditions and the notable progress achieved with respect to deleveraging. the investment

mr duisenberg reports on the latest meeting of the ecb governing council on 4 march 1999 introductory statement by the president of the european central bank, mr w f duisenberg, at the press conference in frankfurt / main on 4 / 3 / 99. ladies and gentlemen, the vice - president and i are here today to report on the outcome of today ’ s meetings of the governing council and of the general council of the european central bank. let me start with the governing council ’ s discussion on recent economic developments and the decisions that the governing council has taken today in the field of monetary policy. after a comprehensive and careful examination of recent trends and ongoing evaluations of the economic outlook for the euro area economy, there was consensus that some of the risks identified earlier, in particular with regard to real gdp growth, had materialised in the fourth quarter of 1998. there was also consensus that the impact of these developments on the balance of risks for price stability would need to be examined further in the context of the monetary policy strategy adopted by the eurosystem. at this juncture, taking into account all the information available, the governing council confirmed its earlier assessment of the outlook for price stability. against this background it decided that for the main refinancing operations to be settled on 10 and 17 march 1999 the same conditions will apply as for the previous one, i. e. they will be fixed rate tenders conducted at an interest rate of 3. 0 %. in addition, the interest rate on the marginal lending facility will continue to be 4. 5 % and the interest rate on the deposit facility will remain 2. 0 %. let me report in some more detail on the governing council ’ s deliberations, and thereby provide explanations for the decisions we took today. starting with the monetary developments in the euro area at the start of stage three of emu, the broad monetary aggregate m3 expanded at an annual rate of 5. 7 % in january 1999, against 4. 5 % in december 1998. this upturn was largely due to an acceleration in overnight deposits. this, in turn, may be explained by the low level of interest rates, which also contributed to credit to the private sector to accelerate further in january 1999 to 9. 4 % which is particularly notable as other indicators of the economy are signalling a slowdown in activity. monthly data on monetary aggregates can be volatile. m3 growth is therefore monitored on the basis of three - month moving averages of the 12 -