work schemes, have protected households against job losses and a drop in incomes. but this has not prevented unemployment from spiking in some countries. in addition, consumers are expected to remain very cautious in the current highly uncertain environment as the ramifications of the pandemic are threatening people ’ s employment and income prospects. 1 / 4 bis central bankers'speeches in turn, subdued demand and the weakening of firms ’ balance sheets and profitability are weighing on business investment. companies are likely to remain hesitant about committing funds to long - term investments as long as there is continued high uncertainty on how the pandemic will unfold and the roll - out of a vaccine. overall, the euro area economy is expected to be severely affected by the fallout from the rapid increase in infections and the reinstatement of containment measures, posing a clear downside risk to the near - term economic outlook. the weakness in economic activity since the onset of the pandemic is also reflected in inflation developments. low energy prices and the temporary reduction in german value added tax are dampening inflation. but weak demand, notably in the tourism and travel - related sectors, and significant slack in labour and product markets are adding further downward pressure. in this environment, we expect that headline inflation is likely to stay in negative territory until early 2021. the key role of monetary policy in this situation is to preserve favourable financing conditions for all sectors and jurisdictions across the euro area, thereby providing crucial support to underpin economic activity and to safeguard medium - term price stability. when thinking about favourable financing conditions, what matters is not only the level of financing conditions but the duration of policy support, too. in this regard, preserving favourable conditions for as long as needed is key to support people ’ s spending, to keep credit flowing and to discourage mass lay - offs. as announced at our october meeting, over the coming weeks the governing council will carefully assess the incoming information, including the new round of eurosystem staff macroeconomic projections in december. these projections will enhance our information set and allow a thorough reassessment of the economic outlook and the balance of risks. on the basis of this updated assessment, the governing council will recalibrate its instruments, as appropriate, to respond to the unfolding situation with a view to fostering a convergence of inflation towards our aim in a sustained manner, in line with our commitment to symmetry. while all options are on the table, the pandemic emergency purchase programme ( pepp )

berlin saying greece will be on its way out of the euro zone if mr tsipras doesn ’ t play ball? first, any talk of greece exiting the euro zone is unreasonable and unrealistic. there has been an extremely strong commitment by european leaders to maintain the integrity of the euro zone, back in june 2012 and ever since this was confirmed. so there is no discussion on an exit and nobody in europe is working on an exit. so that ’ s really not a discussion. now when it comes to policies the ecb is not a political institution, so we ’ ll take the outcome of the election as it is. this is a matter for the greek people to decide. we ’ ll engage with the new government whenever it is identified or in place or in charge to know more about their policy programme and the continuation of the programme. and certainly different government will have different conceptions about what a reform programme should look like, which is just democracy. but i don ’ t want to pass a judgement here. what we ’ ve said is that whatever happens in greece, the ecb will have to abide by its rule but that ’ s nothing new. this has been made public last week. we have a rule that any government collateral can be accepted under monetary policy operations either only if its credit is rated well enough or, if it ’ s not well rated enough, if the country is under an eu / imf programme. and this is not new. this has been ecb policy since 2010. second we ’ ve made it clear that the so - called securities market programme portfolio of greek bonds bought by the ecb cannot be restructured because that would be equivalent to granting an overdraft to the country and that would be contrary to article 123 of the treaty. bis central bankers ’ speeches the liabilities are in the order of €25 billion? close to €20 billion. we ’ re not passing judgement, we are not putting pressure on anybody, we are making clear what our own constraints are in the discussion. these are constraints on us, not pressure we would be putting on others. the current greek programme ends in february. so a new greek programme is required then for the ecb – under its own rules to continue – supporting greek banks? that ’ s absolutely right. but it ’ s not for us to lead the discussion on a new programme. that ’ s between the new greek government and the euro group and the commission. bis central bankers ’ speeches