the next few months, taking account among other things of macroeconomic developments and their feedback impact on the public accounts. the estimated revenue effects of the measures to curb tax evasion are subject to uncertainty, both upside and downside. curbing expenditure growth will necessitate a sharp change of course with respect to the tendencies of the past decade. the limits on the resources at the disposal of central and local government will require, if service cuts are to be avoided, a serious overhaul of organization and territorial coverage. trade payables of government bodies and their public service firms must not be allowed to serve as an instrument for circumventing budget constraints. public financial adjustment and economic growth, together, are essential conditions for financial stability, which is in turn the pilaster of sustained growth. the indispensable modification of the overall composition of the public budget must be directed to stimulating growth. the reforms under way in the public administration and those that will raise the retirement age move in this direction. the curtailment of tax evasion can be a major factor for growth if it corresponds to the lowering of the rates levied on honest taxpayers. with the economic upswing, global payments disequilibria will tend to widen once more, heightening the connected risks to the sustainable growth of the world economy. the international monetary fund is fully committed to ensuring macroeconomic stability, but these imbalances, in being for more than a decade now, will persist for an extended period, and they will have to be funded. this is a titanic enterprise in both size and duration, and one that will only be feasible – without growth - threatening tempests – with capital markets that are far more robust, more transparent and better regulated than in the past. reform of the rules of finance the recent g20 summit in toronto observed that the agenda of essential regulatory reforms is proceeding on schedule. some aspects of the summit ’ s final declaration deserve special emphasis. first, the importance attached to the reform of basel 2 in order to increase the solidity of the system, including ambitious requirements on banks ’ capital levels and the definitions of capital. second, the affirmation of the need for further intensification of supervision, the extension of regulation to the shadow banking system, and the reinforcement of the derivatives market infrastructure. third, the resolution to reach an agreement at the time of the next summit in november. the new prudential rules will significantly increase banks ’ capital and improve its quality, limit

and its impact on the euro area economy at its last monetary policy meeting on 10 april, the ecb governing council confirmed that an ample degree of monetary accommodation remains necessary to safeguard favourable financing conditions and support the economic expansion. this will ensure that inflation remains on a sustained path towards levels that are consistent with our inflation aim – a rate of inflation which is below, but close to, 2 % over the medium term. we continue to expect the key ecb interest rates to remain at their present levels at least 1 / 4 bis central bankers'speeches through the end of 2019, and in any case for as long as necessary to ensure the continued sustained convergence of inflation consistent with our inflation aim. the governing council also confirmed its intention to continue reinvesting, in full, the principal payments from maturing securities purchased under the asset purchase programme. this will continue for an extended period of time past the date when we start raising the key ecb interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation. to preserve favourable bank lending conditions and the smooth transmission of monetary policy, and to support access to financing, in particular for small and medium - sized enterprises, the governing council decided in march to launch a new series of quarterly targeted longer - term refinancing operations ( tltro - iii ). they will start in september 2019 and end in march 2021. significant monetary policy stimulus is thus being provided by our forward guidance on the key ecb interest rates, reinforced by the reinvestments of the sizeable stock of acquired assets and the new series of tltros. the governing council stands ready to adjust all of its instruments, as appropriate, to ensure that inflation continues to move towards our inflation aim in a sustained manner. the benefits of our monetary policy measures have been sizeable and tangible. lending rates for euro area firms and households have declined to historic lows and converged across the region, and growth in bank lending volumes has significantly recovered since the beginning of 2014, thereby supporting investment and job creation. according to today ’ s preliminary flash data release provided by eurostat, there are now 9. 2 million more people in employment in the euro area than there were at the end of 2014, just before the ecb announced its expanded asset purchase programme, and 10. 8 million more than in the second quarter of 2013, when the number of people in work fell to its lowest point during the crisis. completing