common european objective of creating a truly transparent and integrated european financial market in line with the single market agenda. the eurosystem will continue to play an active role in the payment industry by offering several types of service and infrastructure to the financial market. it has proven that it is capable of managing large - scale facilities and now provides a borderless core infrastructure for real - time settlement in central bank money with target 2. furthermore, a medium - term project for the next generation of collateral management has been launched under the name of “ collateral central bank management ” ( ccbm2 ), the objective of which is to consolidate and enhance the efficiency of the eurosystem ’ s collateral management systems to the benefit of eligible counterparties. currently, there is a public consultation on the draft ccbm2 user requirements under way, in which market participants have been invited to provide their comments by 5 may 2008. let me also elaborate on the new target2 securities ( t2s ) project. the t2s project is the eurosystem ’ s proposal for making cross - border securities settlement transactions in central bank money as secure, efficient and cheap as domestic settlement transactions are today. t2s will build on and benefit from the newly released target2 system thereby combining cash and securities settlements – in real time – within a single european infrastructure. this will be europe ’ s single “ pipeline ” settlement system, a system similar to those that have already been implemented by other economic areas. i firmly believe that t2s will contribute to speeding up market integration and fostering the necessary competition in europe, to the benefit of financial participants and the citizens of europe. the t2s project will act as a driver to remove even more barriers of the kind already identified by the giovannini group, as well as help users to identify the irreducible costs of unresolved barriers in the new efficient borderless settlement environment. this project will also advance the european harmonisation process, creating opportunities for further cost savings and allowing market participants to easily select and choose post - trade partners irrespective of their location within the single market. the impact of t2s on harmonisation is already being felt, building on the valuable work carried out by the csds. the harmonisation process goes far beyond pure settlement activities and will increase the pressure for swift action to harmonise practices, especially in relation to corporate activities, taxes, laws and regulations. the dynamic and second - round effects of t2s will pass through the

same time, compared to holding at 3. 75 per cent, a dfr level of 3. 5 per cent offers greater protection against downside risks that could delay the recovery and lead to a material undershooting of our target further 1 / 3 bis - central bankers'speeches out in our horizon, including the risks associated with an excessively - slow unwinding of the rate tightening cycle. in the near term, headline inflation is expected to fluctuate over the next few months. in particular, headline inflation is expected to be low in september before rising again in the latter part of this year, partly because previous sharp declines in energy prices will drop out of the annual rates. negotiated wage growth will remain high and volatile over the remainder of the year, given the significant role of one - off payments in some countries and the staggered nature of wage adjustments. the forward - looking wage trackers also signal that wage growth will be strong in the near term. further out in the projection horizon, staff continue to expect a rapid decline in inflation, from 2. 6 per cent in the final quarter of this year to 2. 0 per cent in the final quarter of 2025. the expected drop in core inflation ( primarily services inflation ) is even sharper, from 2. 9 per cent in the final quarter of this year to 2. 1 per cent in the final quarter of 2025. indeed, the weaker economy and lower wage pressures that characterise the new projections mean the expected speed of disinflation in the course of 2025 has been upwardly revised. the expected significant deceleration in wage growth next year is in line with the information contained in the wage trackers and reflects the fading out of the " catch - up " dynamics that have driven wage growth in the last couple of years. the disinflation process in 2025 will also be supported by well - anchored forward - looking inflation expectations and weaker price - price and price - wage backward - looking dynamics, in view of the much lower inflation in 2024 compared to 2023. looking ahead, a gradual approach to dialling back restrictiveness will be appropriate if the incoming data are in line with the baseline projection. at the same time, we should retain optionality about the speed of adjustment. in one direction, if the incoming data indicate a sustained acceleration in the speed of disinflation or a material shortfall in the speed of economic recovery ( with its associated implications for medium - term inflation )