jean - claude trichet : hearing at the economic and monetary affairs committee of the european parliament introductory statement by mr jean - claude trichet, president of the european central bank, at a hearing at the economic and monetary affairs committee of the european parliament, brussels, 30 june 2011. * * * dear madam chair, dear honourable members, it is a pleasure to be back in parliament and your committee for our regular exchange of views. once again, our meeting comes at a time when important decisions are being taken but also pending. of particular concern is the conclusion of the legislative procedure on the economic governance package. je tiens tout d ’ abord a saluer les efforts continus du parlement europeen et du conseil afin de rapprocher leurs positions sur le paquet de gouvernance economique. le conseil des gouverneurs aurait souhaite que le conseil europeen du 24 juin dernier fasse un geste d ’ ouverture envers le parlement europeen sur ce dossier. le principal point de desaccord – l ’ extension de la majorite qualifiee inversee dans le volet preventif du pacte de stabilite et de croissance – est d'une importance cle. la zone euro a urgemment besoin d'un cadre de gouvernance economique renforce et ambitieux. la crise actuelle demontre, de maniere irrefutable, s ’ il en etait encore besoin, les consequences nefastes de politiques budgetaires et economiques malsaines. deshalb ist es unerlasslich, zu einer ambitionierten einigung zu kommen. in der aktuellen lage ware eine einigung besonders begrußenswert, um deutlich zu machen, dass die richtigen lektionen aus der krise gezogen werden. let me now turn to the economic and monetary developments in the euro area since our previous meeting in march, as well as the two topics you have asked me to focus on, namely fiscal consolidation and monetary policy on the one hand, and sovereign debt developments on the other. i. economic and monetary developments let me first turn to the economic and monetary developments in

financial regulation and transparency i will now expand on this morning ’ s discussion on “ making markets work : liquidity and regulation ”. apart from central bank and market initiatives, a number of measures in the field of financial regulation, which are intended to prevent another crisis on the scale of the one we have just witnessed, have been decided upon or initiated by various authorities. such measures contribute to structural changes in the institutional set - up of financial markets and are expected to restore market confidence and, ultimately, to support growth. yet the intended positive effects of regulatory measures have to be carefully weighed against their costs and unintended side effects. market participants point out that the regulatory measures must be consistent with one another. the speed of regulatory innovation should not mean that too little consideration is given to the impact one measure will have when taken in conjunction with others. also, consistency on the international level has to be ensured. very importantly, financial regulations should be designed and implemented carefully in order to avoid potentially adverse effects on market liquidity and price formation. for the ecb, efficient, resilient and liquid financial markets are a key prerequisite for the smooth implementation and transmission of monetary policy. the ecb therefore strives to ensure that regulatory reform initiatives do not impose restrictions which may hinder the efficient functioning of markets or impair their liquidity. formally, the treaty on the functioning of the european union assigns to the ecb an advisory role as regards proposed eu acts2, i. e. the ecb is consulted on proposed eu directives ( general framework legislation ). furthermore, delegated and implementing acts press release : ecb announces rescheduling of loan - level data reporting requirements for asset - backed securities, 27 november 2012. see articles 127 ( 4 ) and 282 ( 5 ) of the treaty. bis central bankers ’ speeches qualify as proposed eu acts, and therefore the scope of the ecb ’ s consultation also extends to such acts as well as to draft technical standards. 3 in addition, we continually exchange views with market participants, for example via our ecb market contact groups. 4 the regulatory debate has become a standard agenda item in those meetings. a number of regulatory measures target financial markets. let me focus in the rest of my speech on a very important regulatory initiative and on a concrete example : the review of the mifid ii and, specifically, the proposed price transparency requirements. the ecb also provided an opinion on the mifid ii proposal. 5 as