mario draghi : ecb press conference - introductory statement introductory statement by mr mario draghi, president of the european central bank, and mr vitor constancio, vice - president of the european central bank, frankfurt am main, 25 january 2018. * * * ladies and gentlemen, first of all let me wish you a happy new year. the vice - president and i are very pleased to welcome you to our press conference. we will now report on the outcome of today ’ s meeting of the governing council, which was also attended by the commission vicepresident, mr dombrovskis. based on our regular economic and monetary analyses, we decided to keep the key ecb interest rates unchanged. we continue to expect them to remain at their present levels for an extended period of time, and well past the horizon of our net asset purchases. regarding non - standard monetary policy measures, we confirm that our net asset purchases, at the new monthly pace of €30 billion, are intended to run until the end of september 2018, or beyond, if necessary, and in any case until the governing council sees a sustained adjustment in the path of inflation consistent with its inflation aim. if the outlook becomes less favourable, or if financial conditions become inconsistent with further progress towards a sustained adjustment in the path of inflation, we stand ready to increase the asset purchase programme ( app ) in terms of size and / or duration. the eurosystem will reinvest the principal payments from maturing securities purchased under the app for an extended period of time after the end of its net asset purchases, and in any case for as long as necessary. this will contribute both to favourable liquidity conditions and to an appropriate monetary policy stance. incoming information confirms a robust pace of economic expansion, which accelerated more than expected in the second half of 2017. the strong cyclical momentum, the ongoing reduction of economic slack and increasing capacity utilisation strengthen further our confidence that inflation will converge towards our inflation aim of below, but close to, 2 %. at the same time, domestic price pressures remain muted overall and have yet to show convincing signs of a sustained upward trend. against this background, the recent volatility in the exchange rate represents a source of uncertainty which requires monitoring with regard to its possible implications for the medium - term outlook for price stability. overall, an ample degree of monetary stimulus remains necessary for underlying inflation pressures to continue to build up and support headline inflation developments over the medium term. this continued

both sides will benefit from each other ’ s know - how. prior to the finalisation of the detailed rules of this supervisory model, a public consultation will be held this autumn. • fourth, a comprehensive assessment of the banks that will be directly supervised by the ecb. as this comprehensive assessment – which will involve a risk assessment, balance sheet assessment and a stress test – is currently attracting most attention, i would like to deal with it in more detail. for it makes clear that the banking union can only be a success if we take the correct approach from the out - set. for various reasons, two stress tests have not led to a restoration of confidence in the european banking sector. this will be our third and last chance. before launching the single supervisory mechanism, we should know the state of the banks that we will be supervising. we want to be free of old liabilities when we take on our new task. but it is also beneficial for the supervised banks themselves for us to have a clear picture of the health of each individual institution. bis central bankers ’ speeches by performing the comprehensive assessment we will provide transparency for investors – and that is exactly what is required to sustainably reinforce confidence in the banking sector. the average price / book ratio for large and complex banking groups in the euro area is currently just over 0. 5. this reflects the opinion of investors that banks overestimate the value of their assets, will not deliver the expected rate of return or will require fresh capital. moreover, confidence in the banking sector is much lower in some euro area countries than in others. that also causes fragmentation in the single market, as reflected in the difficulties some banks face in obtaining market funding. the results of our “ inventory ” are then incorporated in a stress test, which the european banking authority ( eba ) will perform in close cooperation with us. our staff members are now elaborating the methodical details of the comprehensive assessment. the final decisions will be made as soon as the legislation comes into effect and the decision - making supervisory board is in place. to enable the supervisory board to start operating promptly, the chair and vice - chair should be appointed as soon as possible after the final adoption of the legislation. we should now consider how to deal with any weak spots that are revealed during the assessment. funding for any capital shortfalls should preferably come from the market. but we also need a backstop in the event that some banks fail to raise the necessary capital. this is