for the federal funds rate unchanged at 0 to 1 / 4 percent, and it expects it will be appropriate to maintain this target range until labor market conditions have reached levels that are consistent with the committee ’ s assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time. we expect that the new framework and guidance will support our efforts in pursuit of a strong economic recovery. thank you. i look forward to our discussion. 1 see update on the economic well - being of u. s. households : july 2020 results, or shed, issued in september 2020 and available on the board ’ s website at www. federalreserve. gov / publications / files / 2019 - report - economicwell - being - us - households - update - 202009. pdf. return to text 2 using data from adp, the board staff estimate that at the end of april, 41 percent of the workers in the bottom quartile ( based on their previous wage ) had lost their jobs, compared with only 13 percent for the other three quartiles. see the board ’ s june 2020 monetary policy report, available at www. federalreserve. gov / monetarypolicy / files / 20200612 _ mprfullreport. pdf, for more details. 4 / 4 bis central bankers'speeches

broad spectrum of improved profitability is one reason for my generally optimistic outlook of banking sector stability in the near future. the second topic i would like to draw your attention to is an interesting paragraph in the report that reflects on the links between large banks and hedge funds. here, new practices are arising and are quickly establishing themselves as common standards. the report mentions e. g. the introduction of multi - asset platforms, portfolio - based cross - product margining and the prime broker services as the principal counterpart in hedge funds ’ transactions. as analysts of banking sector stability, we have to take into account that the links between large eu banks and hedge funds are intensifying. it cannot be excluded that competitive pressures may have forced some prime brokers to compromise on due diligence when dealing with hedge funds. continuing vigilance therefore remains essential for banks to ensure that they retain a good grasp of their overall exposures to unregulated financial institutions. however, in terms of financial market resilience, i tend to answer that the markets – and here i refer to a point i made before – have been making enormous progress in understanding the specific risks and in aligning their risk management systems accordingly. while banks ’ risk management systems have improved over recent years, there are some uncertainties about the ways in which risks have been redistributed by credit risk transfer products, both within the banking system and between banks and other financial institutions, as well as about how the market for these products would perform in a more challenging macro - financial environment. i would like to close my remarks with a cautious but positive outlook. the mostly positive assessment of financial conditions of banks outlined in the report is confirmed by forward - looking market - based indicators that continue to suggest a robust outlook for the eu banking sector in terms of profitability and credit quality. thank you for your attention. i am looking forward to receiving your questions on our assessment of the stability of the eu banking sector.