yves mersch : interview in hospodarske noviny interview with mr yves mersch, member of the executive board of the european central bank, in hospodarske noviny, conducted by ms kristina votrubova on 11 january 2019. * * * there are rumours about the ecb´s plans to raise interest rates, however there are also voices that it is not a good idea, as the situation is changing. what is the ecb´s position? the ecb ’ s position is that we will continue with our policy of monetary accommodation for as long as necessary. we are confident that what we have done is helping us to get inflation in line with our objective at levels below, but close to, 2 % over the medium term. so no date has been established for raising the interest rates. we never announce in advance how, when or by how much we intend to use different instruments. that is not how central banks work. we give broad forward guidance on the direction of our monetary policy. but we always look at incoming information and evaluate whether it is in line with how we expected the economy to behave. what is currently happening to the economy is still broadly in line with our baseline scenario. we had already anticipated a slowdown in growth when we announced these baselines. now that the slowdown is materialising, we do not have to take it into account for a second time in our policy response. fundamentals have not changed but political uncertainty has increased. slovakia would need interest rates to rise as household debt is increasing alarmingly. what is the ecb ’ s view of the situation in slovakia? first, we conduct monetary policy for the euro area as a whole rather than for individual countries. second, if we raised interest rates to curb household debt, the effect would also impact the corporate sector and investment. that is why there are macroprudential instruments at the disposal of national authorities. and i have seen that the competent authorities in slovakia, including the national central bank, have taken action to tackle the dynamic rise of household debt. i think once you have put such instruments into action, you would like to see also what the effect of these instruments is. do they work as is expected? and, as i have been told, there seems to be a positive reaction. in the majority of european countries, the economic cycle has already reached its peak and the euro area economy is slowing down. how does the ecb view the situation and what are

change for monetary policy transmission and price stability. second, the ecb will introduce environmental sustainability disclosure requirements for eligibility for collateral and asset purchases. third, we will adapt our risk assessment framework, our corporate sector asset purchases and the collateral framework for climate - related risks. during our review, we also addressed the communication of our monetary policy. we heard directly how our policies affect the lives of european citizens and their desire to better understand those policies. our last review took place well before smartphones were around, so there was a strong case for enhancing our communication with the outside world. you will notice some changes in the coming weeks relating to our regular communication. for example, a new, 2 / 3 bis central bankers'speeches more narrative - based, and more concise monetary policy statement will replace the introductory statement at our monetary policy press conferences. but also, our monetary policy communication geared towards the wider public will be adapted through a more visualised and more accessible approach. and, reflecting the successful experience with the listening events, the governing council intends to continue to interact on a regular basis with the public via eurosystem outreach events. the review of our strategy that we have just completed took place 18 years after the previous one. looking ahead, the rapidly changing world that we live in means that we cannot wait for another 18 years before undertaking the next review. a regular review cycle, with the governing council periodically reassessing the appropriateness of its monetary policy strategy, will ensure that the strategy remains fit for purpose. it will also further enhance the ecb ’ s transparency and accountability to european citizens. we intend to carry out the next assessment in 2025. the governing council yesterday also endorsed a longer explanatory overview note on the ecb ’ s monetary policy strategy, which will be published after the press conference. we are now ready to take your questions. 3 / 3 bis central bankers'speeches