above example ). proponents of more government spending should also bear in mind that even in the absence of the euro adoption factor, malta would still have to abide by the stability and growth pact ( sgp ). you might recall that even the british government, which has no immediate plans to adopt the euro, was called to order by the eu council some time ago because of its growing budget deficit. then again, sound public finances are fundamentally a matter of economic common sense and prudence. so much so that in recent years there have been repeated calls on the government from all quarters to reduce the deficit and the public debt. is it not strange, therefore, that just when headway is finally being made in this very direction, we hear calls for a reversal of this policy and for engineering what would at best be a short - term boost to growth? one should also bear in mind that malta ’ s main challenge is to become more internationally competitive. in this respect, an increased fiscal deficit will not solve anything. malta needs quality growth, preferably resulting from foreign direct investment, which brings with it capital, technology and markets. and that kind of investment tends to go to countries with sound economic fundamentals, including a budget that is balanced over the course of the business cycle. more immediately, if we renege on the convergence programme targets, there would be a real risk of a drop in investor confidence. this is confirmed by recent developments in interest rates and in bond markets in central europe, where markets have started to punish countries who risk delaying euro adoption. it is indeed relevant to point out that malta ’ s current ‘ a ’ rating is predicated upon the continued pursuit of fiscal consolidation. there is an additional short - term gain from staying on course. as i have mentioned, fiscal restraint also helps to reduce the country ’ s external imbalance, and this, in turn, could allow a cut in the interest premium that investors require in order to hold maltese lira assets. this would mean lower interest rates. on balance, therefore, the outcome of a u - turn on fiscal policy is unlikely to be positive. 4. last year ’ s entry in erm ii has been described as hasty and premature. why the rush to join the euro? does it not rule out any possible adjustments to the value of the lira? one of the arguments made in support of this view is that our euro adoption calendar does not allow government to run a higher deficit and thus promote faster growth. i

mario draghi : ecb press conference - introductory statement introductory statement by mr mario draghi, president of the european central bank, and mr luis de guindos, vice - president of the european central bank, frankfurt am main, 25 july 2019. * * * ladies and gentlemen, the vice - president and i are very pleased to welcome you to our press conference. we will now report on the outcome of today ’ s meeting of the governing council, which was also attended by the commission vice - president, mr dombrovskis. based on our regular economic and monetary analyses, we decided to keep the key ecb interest rates unchanged. we expect them to remain at their present or lower levels at least through the first half of 2020, and in any case for as long as necessary to ensure the continued sustained convergence of inflation to our aim over the medium term. we intend to continue reinvesting, in full, the principal payments from maturing securities purchased under the asset purchase programme 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. the governing council also underlined the need for a highly accommodative stance of monetary policy for a prolonged period of time, as inflation rates, both realised and projected, have been persistently below levels that are in line with its aim. accordingly, if the medium - term inflation outlook continues to fall short of our aim, the governing council is determined to act, in line with its commitment to symmetry in the inflation aim. it therefore stands ready to adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner. in this context, we have tasked the relevant eurosystem committees with examining options, including ways to reinforce our forward guidance on policy rates, mitigating measures, such as the design of a tiered system for reserve remuneration, and options for the size and composition of potential new net asset purchases. incoming information since the last governing council meeting in early june indicates that, while further employment gains and increasing wages continue to underpin the resilience of the economy, softening global growth dynamics and weak international trade are still weighing on the euro area outlook. moreover, the prolonged presence of uncertainties, related to geopolitical factors, the rising threat of protectionism, and vulnerabilities in emerging markets