 So ladies and gentlemen 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. Dombrowski's Based on our regular economic and monetary analysis We decided to keep the key ECB interest rates unchanged We continue to expect them to remain at their present levels at least through the summer of 2019 and in any case for as long as necessary to ensure the continued sustained convergence of inflation to levels that are below But close to two percent over the medium term Regarding non-standard monetary policy measures We intend to continue reinvesting in full The principal payments from mature insecurities purchased under the asset purchase program 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 favorable liquidity conditions and an ample degree of monetary accommodation The incoming information has continued to be weaker than expected on account of software External demand and some country and sector specific factors The persistence of uncertainties in particular relating to geopolitical factors and the threat of protectionism is weighing on economic sentiment At the same time supportive financing conditions favorable labor market dynamics and rising wage growth continue to underpin the euro area expansion and gradually rising inflation pressures This supports our confidence in the continued sustained convergence of inflation to levels that are below But close to two percent over the medium term Significant monetary policy stimulus remains essential to support the further build up of domestic price pressures and headline inflation developments over the medium term This will be provided by our forward guidance on the key ECB interest rates Reinforced by the reinvestments of the sizable stock of acquired assets In any event The governing council stands ready to adjust all of its instruments as appropriate To ensure that inflation Continues to move towards the governing council's inflation aim in a sustained manner Let me now explain our assessment in greater detail Starting with the economic analysis Euro area real GDP increased by 0.2 percent quarter on quarter in the third quarter of 2018 following growth of 0.4 in the previous two quarters Incoming data have continued to be weaker than expected as a result of a slowdown in external demand compounded by some country and sector specific factors While the impact of some of these factors is expected to fade The near-term growth momentum is likely to be weaker than previously anticipated Looking ahead the Euro area expansion will continue to be supported by favorable financing conditions further employment gains and rising wages lower energy prices and The ongoing albeit somewhat slower expansion in global activity The risks around in the euro area growth outlook have moved to the downside on account of the persistence of uncertainties related to the geopolitical factors and the threat of protection is vulnerabilities in emerging markets and financial market volatility Euro area annual HICP inflation declined to two to one point six percent in December 2018 from one point nine percent in November reflecting mainly lower energy price inflation on The basis of current futures prices for oil Headline inflation is likely to decline further over the coming months Measures of underlying inflation remain generally muted But labor cost pressures are continuing to strengthen and broaden and made high levels of capacity utilization and tightening labor markets Looking ahead Underline inflation is expected to increase over the medium term Supported by our monetary policy measures the ongoing economic expansion and rising wage growth Turning to the monetary analysis broad money M3 broad money growth moderated to three point seven cent in November 2018 after three point nine percent in October and Three growth continues to be backed by bank credit creation The narrow monetary aggregate and one remained the main contributor to broad money growth The annual growth rate of loans to non-financial corporations stood at four percent in November 2018 after three point nine in October While the annual growth rate of loans to households remained broadly unchanged at three point three percent The Euro area bank lending survey for the fourth quarter of 2018 Suggested overall bank lending conditions remained favorable Following an extended period of net easing and demand for bank credit continued to rise thereby underpinning loan growth The pass-through of the monetary policy measures put in place since June 2014 Continues to significantly support borrowing conditions for firms and households access to financing particular for small and medium-sized enterprises and credit flows across the Euro area To sum up a cross check of the outcome of the economic Analysis with the signals coming from the monetary analysis Confirmed that an ample degree of monetary accommodation is still necessary for the continued sustained convergence of inflation to levels that are below but close to two percent over the medium term In order to rip the full benefits from our monetary policy measures Other policy areas must contribute more decisively to raising the longer-term growth potential and reducing vulnerabilities The implementation of structural reforms in euro area countries needs to be substantially stepped up to increase resilience Reduce structural unemployment and boost euro area productivity and growth potential Regarding fiscal policies the governing council reiterates the need for rebuilding fiscal buffers This is particularly important in countries where government debt is high and for which full Adherence to the stability and growth pact is critical for safeguarding sound fiscal positions Likewise the transparent and consistent implementation of the EU's fiscal and economic governance framework over time and across countries remains essential to bolster the resilience of the euro area economy Improving the functioning of the economic and monetary union remains a priority The governing council welcomes the ongoing work and urges further specific and decisive steps To complete the banking union and the capital markets union and now we are at your disposal for questions Piers Kolomowski Bloomberg My first question relates to your assessment the risk of move to the downside What sort of implication that Will have for your policy and especially for your forward guidance and my second question You told us in December that at some point you will ask committees to to start work on telchros Have they already been put to work have they been tasked with with looking into telchros. Thank you Thank you Well today we didn't discuss the implications today's meeting was essentially devoted to an assessment where are we and Why are we here? How long will the slowdown last is the slowdown got worse or stay as a as a shallow lower path These were the questions that were asked And on the second question We several speakers actually Raised this issue, but no decision was taken So it was because we didn't discuss policies this time We only were focused on the assessment quite clearly the assessment will have implications about policy, but we didn't discuss them Mr. Karani Thank you. Baraj Karani from Boiters two questions as usual. Mr. President Given that data have disappointed on the downside fairly consistently since your last meeting What gives you confidence that your your Economic assessment is actually correct and there's going to be a rebound and my second question is quite similar Which is about core inflation? You predicted a vigorous rise in core inflation towards the end of last year It didn't happen and it's still not happening again. What gives you confidence that your assessment is correct? it's it's basically one question really and You see underlying inflation has been muted has been moving sideways it's higher than the lower levels that reached about a year ago and It does what is on what our confidence is based It is based on the continuation of the economic expansion it is based on The strong labor market performance though. It's slowing down. It's based on the Encouraging pick up in wages nominal wage growth has gone up Especially of course in the core countries and especially in Germany Both compensation per employee and negotiated wages Show a pickup consistent significant pickup So the issue is so we see all these components moving in the right direction and So the the question is why haven't they passed through? Why aren't they being passed through in two higher prices and what what we are observing is that the there is a profit squeeze? So it's a matter of time That of course this pass through will happen First in the parts of the eurozone where the labor market is stronger unemployment is lower Especially in some countries where basically there is full employment and Then gradually will expand to other countries That is what really gives us and then of course the financing conditions and our monetary policy that remains fully accommodative Strengthens our confidence in this in this process this vice-part Anette advice by CNBC. I have two questions. You were saying that your yeah, this meeting was more or less for the assessment of where we stand when it comes to the economy and How long the potential downturn will last so how long will it last any of you and another question is Whether you're happy with what the market is pricing in in terms of interest rate Because now the market is only pricing in the first hike in 2020 and you're still guiding us More or less for like the fall period of this year So what's your view here is the market right or do you need to upgrade or update us on your forward guidance? Thank you very much. Okay, since you're all asking let me give you a summary of the meeting now so first of all What you care most where we unanimous Okay, we were unanimous about acknowledging the weaker momentum and Changing the balance of risk for growth we're all in agreement on that and We were unanimous in assessing the factors that have caused the slowdown Namely first and foremost. There is an increase in general uncertainty This increase in general is being produced by the threats of protection is doubts where it actually extensive doubts about the the Multilateral rules that have have underpinned our growth since since the Second World War the Protracted and unclear outcome the protracted negotiations and the unclear and their unclear outcome yet about Brexit and of course the implications that this might have I've said many times that if you compare the potential Disruption coming from brexit for the aggregate of the euro area. Well, just looking at aggregate numbers It doesn't seem to be to be an extensive Disruption, but we have taken to account things like value chains And we have also to take into account that the some countries are more exposed of course to Events in the brexit case So we we follow that but that just is a sign of a contribution to the increase in In general uncertainty and then of course we have the political developments in in some in some countries in eurozone This is one set of of factors. There's another set of factors that is specific factors that are specific to certain countries and And this is has to do with the slowdown in China And the waning effects of fiscal package in the United States and the car industry in Germany. So all this It's a pretty long list of factors. So the issue is now and that's again. There was unanimity in saying that the key Aspect to assess is the persistence of the general uncertainty as being produced by these factors And this certainly if this if all this were to persist We should expect a longer a longer weak momentum beyond the near term so and then finally there was also quite and I would say anonymity about assessing the likelihood of a recession as being low now again We I don't want to give numbers here, but some of them are very low others are on the average since the last 60 years or 50 years So in any event pretty low of course again In a in a in an area like the eurozone these these estimates All to be taken with some caution because if you have a recession serious session in one part of the eurozone That can spread to other parts, but basically there was unanimity about assessing this likelihood as low Also why this is why was it low because conditions financing conditions continue to be basically very favorable developments in the labor market continue to be positive nominal wage growth continues to continues to be significant and Of course the lower energy price support disposable income real disposable income for households, but also there is another factor to keep in mind That makes the present situation different from From the situation we had at the beginning of the great financial crisis that this time Banks balance sheets are much stronger than they were before the crisis Now of course we have local episodes of weakness But by and large the banking sector is much stronger than it was at the beginning of the crisis So the the conditions for a continuation of credit to the economy are in place Then the discussion focused on on persistence again, then there were two viewpoints for some as usual for some China The slowdown in China won't last long because we have confidence and we do have confidence in the in the government's measures and everything we know is Looks says that the government is actually taking the strong measures to address these lowdown The trade disputes will be will wane In the end the Brexit thing will not affect the new economy that much But especially the there wasn't one aspect of the discussion is that all these Uncertainties all these risks are being addressed by the policy response of the authorities in these countries so in And and and the and the specific episode of the car industry in Germany will soon Weighing out because there is going to be a rebound in the sector one thing that basically of course we all agree is that if there is going to be Clarity on the exports and the trade Sector much of what we are seeing today in terms of weakness will very likely wash out Others however for others However the downside movement in all industries in all indicators both hard and soft has lasted now several quarters And all these risk factors are not going to disappear and they are affecting confidence So you see these are the two perspectives in the assessment of persistence having agreed about everything else So the conclusion of all this is that the governing council will give itself more time to assess whether all these risk factors have affected confidence and We are going to have another discussion in March when we'll also have the new projections Now about inflation Of course the going back to the first of the other question I had focused in underline on the first of all on headline inflation Well, clearly it's being driven by oil prices mostly but also from by food and services prices to much lesser extent and And on underlying inflation and here I've answered to I basically gave you the sense of the discussion You answer in your question Now of course if this momentum were to last long And if the convergence were to happen Around growth potential or even below growth potential of course the time that will take for the for the inflation to converge To a Raymond objective will be longer But all throughout this and again there was there was Agreement about the monetary policy being there has been Accommodative very accommodative even though we stopped the net as a purchase It wasn't a tightening as some people have said actually it's been very accommodative for a variety of reasons the term structure curve the flattened the term premium is negative and And so and so even the discount component to stock prices has contributed to stock prices to keep them to keep them higher and Most importantly liquidity conditions are abundant and will remain abundant so as I said several speakers mentioned the tell true and And that's it I'm sorry, which was oh, yeah, yeah, yeah, but you see the I Was asked the same question last time. I'm not sure was you but the The fact that the mark let's go back to our for guidance and says We intend to continue reinvesting in full the principal payments from maturity And I know the other part of the four guys as we continue to expect into the keys be interest rates to remain at their present levels At least through the summer of 2019 and in any case for as long as necessary To ensure the continuous sustained convergence of inflation. So it's both date and state contingent when markets Place the first rate hike in 2020. They are they are using the state Contingent part of our for guidance they assess the economic prospects that way and they it shows that they have Understood our reaction function and in so doing in in the flattening of the yield curve that has taken place Continuously by the way since we announced the end of the net asset purchases starting in June last year They are providing accommodation through that through that Channel of course we have to assess then the developments and if this persistent will continue will have to validate This indication, but at this point in time would just assess the situation Mr. Fallis Thank You Tom Fallis in the Wall Street Journal. I had a question about negative rates and the persistence I suppose negative rates have been in place for three or four years now and Four years, no, you know better. I'm say you know more than we do and If markets are correct that negative rates would continue for another year and a half would the ECB need to do anything to mitigate that I think in last month last time you mentioned that you were concerned about the impact on banks Would there be a way to introduce a tiered deposit rate for instance or to a limited interest rate hike? and my second question is On who else could be helping out if the if the weakness continues How much of the onus will be on governments and in particular Germany? I suppose which is the the big country that has got Fixed or fiscal space to cut taxes or to increase spending. Thank you Thank you Well, we have to see I mean to answer the second question first We have to see first how protracted this low-down is going to be how persistent these the factors that have Originated this low-down are going to be and this applies to fiscal policies Well, by the way fiscal policy in the euro area now It's a slightly expansionary certainly more expansion in the last year And this is true in Germany, but also true in many other countries if not all countries I think of the euro area in their draft budgetary plans are presenting expansions and on the on the first point Let me just go back about what I think I said last time Negative interest rates affect negatively the net interest margin and That's almost a tautology, but especially because Interest on deposit is set to zero But when we look at their effect of the effect of negative interest rates Which by the way have been a very effective monetary policy measure, and it is an effective monetary policy measures now It remains so so when we look at the effect of negative rates on on on Profitability of the aggregate of the banking sector We see that by and large the positive effects of the recovery Generated by the more accommodative more expansionary monetary policy Produced by the negative rates compensate offset each other and We'll have to see now how will the continuation of negative rates will affect this balance But but let me also add another factor That profitability in the euro zone banks profitability is affected I would say in many cases much more significantly By factors like cost coverage ratios that in some countries are way way above any any average by the presence of stocks of non-performing loans that by all accounts are way above any average By overcrowding so there are structural and Business model Specific factors that affect the overall profitability and it's in this sense that I said we will continue to monitor the Profitability of the banking sector very very closely and What I just said shows how important this is because that's one of the main difference between Main differences between now and the situation we had before the crisis The main difference is that banks are strong now or least stronger silly stronger than they were Before the crisis and this is a key for making sure that any Down-turn in growth doesn't transform itself into a recession miss Jones Clejones financial times and Mr. Draghi you're joining the Federal Reserve today in acknowledging some of the concerns that people have over the The global economic outlook, but I think the Fed has also been clear that it's going to react to that by doing Probably less rate hikes this year Whereas even though the the balance of risks has changed today There's not so much of a sense about how exactly you're going to react to that So would it be possible for maybe you to spell out a little bit about what you see your reaction function as being for instance How would you weigh up the tell-trades? Are they something distinct to her to a maintenance of a loosening stance that they more about? dealing with liquidity in the banking system and how important is the forward guidance on rates vis-a-vis the the forward guidance on Reinvestments and just a quick second question if I may the bank lending survey seemed to point to a tightening and Anticipation of a tightening in demand for credit over the the common quarter. So how much of a concern is that? Thank you Thank you The the I'll answer the second question You're right. It does point to a tightening very I mean slight tightening But the result of that a figure is mostly centered in Italy So it's a tightening. It's not spread to the rest of the eurozone on On on the the other question. Well, we are still in the assessment mode And in today's meeting was about that Not so much the policy mode But let me say at the very beginning that the nature of our forward guidance, which is both it is date But it's also state contingent has already produced a reaction in terms of increasing the degree of accommodation of our monetary policy and It's been producing this reaction over the last several months flattening the curve and Going and producing all the effects I mentioned before Now What is next next will depend on whether we will end up assessing this as lower growth as all the factors that have produced this lower growth as persistent and Then we will consider different contingencies and different elements and and of course I don't want to speculate about what contingency would call for a specific instrument But if you look at the number of instruments, we have in place now We can conclude that it's not true that the ECB has run out of fuel or has run out of instruments We have all our toolbox still available Thank you Sandra better last time Mr. President, you just said that you didn't take a decision about the new TLTRO For banks, but I'd like to ask you if you think they should be useful for banks And what do you think what do you answer to the German economist who's saying that a new TLTRO should be a Gift a subsidy for Italian and Spanish banks. Thank you Elthrose and telthrose both of them have been very useful and very effective Very effective in restoring transmission of monetary policy across the euro area you remember when they were implemented the Elthrose was 2012 the telthrose came later. They were more targeted to lending, but they've been unquestionably effective So what in a somewhat more more more I would say polite way What these what these economists are saying is If you If we are to do telthrose they should there should be a good case for monetary policy In other words, we don't want we want to have telthrose or Elthrose to address cases of Existing or likely fragmentation in the monetary policy Space in other words, we don't want to be a gain in the situation where we were in 2012-13 and 14 where we lowered the interest is policy interest rates and this was not translated into lower lending rates and So if that's necessary we'll do whatever is necessary for to address this point. It's not It's it's actually it's that what they are saying is that there must be a case of monetary policy for doing it So it shouldn't be something that we do it as as in there, right? I mean as a as a sectoral measure Was a country-based measure? Mr. Stumpf Thank you. Andres Stumpf from expansion. I would like to know which concrete instruments that you have to to adjust in in case of a weaker scenario you said you had the full toolbox, but Some have been in place yet and already and then I would like to ask about the situation of the illegal form tapping that it surrounds the former President of baby where I in Spain, I would like to know the ECB position about and it if it can do anything if There's a reputational reputational risk for the bank Thank you. Thank you. I have answered to the first question already Some of our some some of our instruments have already been playing They are a accommodative role in the past few months Others may be acted depending on the evolution of the of growth and Of the factors that have originally produced this lower momentum On the second question, I would ask the vice president to Respond With respect to the second question as you perfectly know BBA has launched an Investigation an internal investigation that is underway and today it has announced that it has started also a sort of forensic Pro that is going to be conducted by a third party And I think that we have to wait for the for the for the conclusions of these probes and these investigations We expect that the conclusions will be available as soon as possible because in this kind of circumstances Time is of the essence Mr. Tsutra Marcus Tsutra is a Deutsche Zeitung the German government is clearly favoring a merger of Deutsche Bank and Commerz Bank So what is your take on that from a supervisors perspective? Would you oppose that plan? I'm sorry. I can't answer this question and not commenting on individual institutions Thank you Mr. Draghi, you just said the whole toolbox is still in place, but in case a downturn Where to become a real recession with serious negative effects on inflation Would the ECB have enough policy space to respond with interest rates already at zero or sub zero and With QE already having reached its limits the capital key and the issue limit. Thank you Well, you see we when I said we still have instruments in our toolbox first of all Let's go back to when we announced that the end of the net asset purchases Which was June last year at that point in time. We we we we actually We decided to Well for several things we decided to stabilize the existing stock The stock of bonds we own is not indifferent. It's pretty big It's more specifically. It's 25 percent of total government debt and eligible universe now So to stabilize and to stabilize the stock by itself does require Purchases of bonds every month, which this year is about of the order of 15 billion euros Which was by and large the same amount we were purchasing on a net basis until December but the important thing for Judging and the result of important thing for judging Whether this is Contractionary or is accommodative is the stock a Relative to the volume of bonds and I said it's 25 percent but also the evolution and We don't expect the stock of government bonds to increase in the future As a matter of fact the stock of government bond has been declining since 2014 in the aggregate of the eurozone Of course, we have exceptions, but what matters for from the from our viewpoint is the aggregate of the eurozone so the stock of long the volume of long-term bonds is Is not is not growing and we expected falling until 2021 by and large by six percent so the pressure on rates will be less less by itself and Which also says that liquidity will remain very abundant well into the next decade So when you come when you go and measure this You see what I think was I said before when you look at the risk-free rates across maturity is You see both the level and the shape of the term structure they've gone down the flattened the term structure and the levels been going down Now ten year bonds are now lower by 20 business points in June and Rates kept on going down So by it said this provides accommodation now the So then the rest I think I've said now of course the spreads is a different issue The spreads in different countries or for certain segments of the bone market have evolved depending on specific sectoral or country conditions Mr. Viva But of course let me finish we so we have a long list of instruments now We have the reinvestment. We have the forward guidance date based. We have the app We have deltro we have lots of instruments and we stand ready to adjust them or use them according to the contingency that is is produced Frank Viva handles blood just another topic. Is there any news about a possible successor for Sabine a loud and slag and her function as a supervisor. Do we have anything for us? No No, I'm sorry not yet, but you will know it Well, we have to ask you know it soon. No, no Luke Heisen market news Mr. Juggie have your views on the scale of the potential downside risks from Brexit evolve since last week's House of Commons defeat For Theresa May would you expect your assessment of those risks to change in the event of a general election in the UK? and my second question was Could the same issues that suggest a first interest rate hike may be delayed well beyond the summer Also have the potential to be positive risks For example, if we get a soft Brexit a US China trade detente or as he suggested it will China responds well to the government's stimulus measures Should the markets also prepare themselves for the surprise of a rate hike this year? Thank you. Well, the first question is definitely too difficult for me I can't answer the question because I just wouldn't know Now the the second question is in a sense of the the the account I gave you of the debate of the discussion we had and got in council answers this question the One one part of the participants Doesn't let people this way doesn't exclude because we are not yet at the level of having certainties but doesn't exclude a All in all a more benign outcome And another part would that is is closer to exclude this and just and just work for the downside, so it's And therefore the the consequences of this discussion will reverberate in the market rates It's learned the Mike's coming here You speckled a number of times about your optimism that tightening labor markets and rising wages will help inflation Converged toward the ECB's target We have seen tightness in the labor market in the US for some time now with very little Resulting inflationary pressure. So what makes you think that the eurozone? Wage recovery will be different than what we've seen in the US Well, actually, it's not that different because in the US you've seen inflation hovering around 2% So it means that it's taken At several number of years in mind us is more advanced than we are in the in the in the business cycle really so it's taken several number of years in us to have this pass through from wages in two prices and So I would expect that if it takes the same number of years, we may be there as well, but it's been Inflation is not it's not far from the from the from the target in the US Thank you Mr. David oil the Federal Reserve started rising rates in the Yeah The Federal Reserve started rising rates in 2015 The European Central Bank may do so after the summer the time gap is a four year Does the European Central Bank believe that this distance will be reduced or the divergence of growth? Between the two economy US and Europe is structural. This is first question. The second question is a European government As I thought that the vigilance of a European Central Bank Saying it is impartial. How does the European Central Bank comment? Thank you. Thank you the timing of monetary policy actions in Old jurisdictions is dictated by the respective positions by the positions of the economies in the respective business cycles structural differences may play May may make a difference, but you know structural difference where they are before and are gonna stay there later It's hard to understand how they can influence, but certainly they may have an effect. So it's It's it's hard to say it's hard to project these that different in day difference in dates to different business But we have to keep in mind that once we are at the same stage with the labor market the same degree of tightness Everywhere in the eurozone because one one feature of the eurozone is it's heterogeneity In some parts of the eurozone We have no doubt these parts are at full employment and have been at full employment for a while so much so that if anything The obstacles to higher growth are now to be found in the scarcity of labor or In the scarcity of skilled labor or in the in the capacity of the plant and equipment But in other parts of the eurozone unemployment is still high Significantly high and so you have slack there. So you have lower wage momentum You have lower demand which Humpers the pricing capacity of firms and therefore the past through Into into higher price. So it's it's heterogeneous and that's one thing to keep in mind now You know on various occasions various governments have attacked both supervision, but also monetary policy All of you can't I mean certainly remember other instances where where the ECB monetary policy was being publicly criticized by prominent prominent politicians As I said, it's it's understandable that when things go don't go their way The politicians would protest and say what they want. It's also understandable that the ECB doesn't listen Mr. Powell, I'm not yours power. It is it You've spoken at some length about the rising uncertainties and now one obvious Uncertainty is who will succeed you Is there a sense in the governing council that the process of finding a successor should be Expediated, you know, it's it's a difficult answer. I'm a little biased. I have done I have that sense Maybe maybe people like me But I don't have that sense from the governing council, of course people know that the mandate is about to end But we have no say about that, you know, it's it's it's decided by other people Well, I mean these processes have always been like they've always been decided by other people in other fora and Central bankers have no say about that so we wait for the decisions taken by by the European Council by the Eurogroup Thank you Miss Bufaki Isabella Bufaki from so le 24 hour and have two questions You did mention a recession a few times and it's low risk But I wonder whether you would like to comment on any way risk We went really close to or maybe we are into technical recession for Germany and Italy whether You looked at that in particular whether you thought that the factors in Germany were Mostly temporary, but maybe for Italy they were more deeply rooted and then you also said that the banks balance sheets are much stronger anyway market capitalization of major European banks is very low and There are some as you said isolated cases, but troubled cases for banks in Italy and Germany and Recently the ECB as some has increased its pressure on requirements for NPL provisioning and we have now flows and also stocks what seems to be called the Daniel Nui package also on legacy assets, so Would you get to comment on that given that I see the discussion on TLT arose is not started But maybe there is an issue not of liquidity, but maybe market access of certain banks. Thank you well, I said I said they are strong banks are stronger in comparison with What they were how they were at the beginning of the great financial crisis Of course banks can be stronger, but if you look at the capital ratios today are much higher than they were in 2006 but also risk management controls the overall banking sector has in response partly in response to To the regulation partly in response to their own the exchange in their own business practices Is is stronger than it was before Given that we certainly know that we have as I mentioned before in a different context We have cost coverage ratios, which are above any in some parts of the eurozone Are above any comparator We have NPL stocks, which are high and that what you said actually shows the case for a speedy Elimination of NPL stocks because it does strengthen the economies against against a recession it does ensure the People of these countries that a recession doesn't become a gain a credit crunch Which worsens the recession again, which was the experience in in the great financial crisis so the I don't know much about the frankly about the Daniel we package and and so you these questions you will have to ask when we are maybe he has an area package to propose that But I don't know much about that now on the possibility of recessions in Germany and Italy, I think I've Discussed that right now the going in council doesn't assess this as a likely possibility And as I said likelihood of recessions changes from different parts of the of the eurozone, but overall any aggregate This there was was no no sense that the recession was a likely event Mr. Bowlin Thomas Bowlin from follow the money and The Dutch scientific Council for government advice in the Netherlands has performed three-year research into the monetary system and They concluded that the lack of a digital alternative for cash money is contributing to Instability in the financial system and they advised the foundation of a full reserve bank or giving The public access directly to central bank reserves or access to central bank digital currency My question is whether the foundation of such a full reserve bank is possible within the current regulatory framework and Whether the ECB is considering experiments with central bank digital currency The answer to the second question is no we are not considering experiments in this field To the first question There is a vast amount of work that's taking place across different central banks and Centered in the BIS the bank for international settlements But To say that this would lead to a change of this importance anytime soon would be would be wrong Would be an exaggeration Actually rather the opposite is true It's rather the risks of movements like that which which by the way I know that in some countries have been have been asked by by the public and in some countries Some countries not many very few as a matter of fact are close to doing something like that But the studies that have the work that has been done highlights more the risks of An approach like that for monetary policy for the banking system for financial stability then the Benefits, but that's the that's a snapshot of how things stand at this point in time And the final question to miss is one lovin at the back Mr. Draghi question from for being our news radio in the Netherlands today new pension cuts have been announced and I Was wondering what what would you like to say to those people who fear their savings? due to pension cuts and low interest I'm sorry. I'm not in a position to comment on this Because I promised one more minute, so it's just We can do a second round if you want Another please You said Julia Wackett from Bresens item you said in your introductory remarks that Steps to strengthen the eurozone architecture have to substantially be stepped up But how do you feel the chances of this given that all the major country is facing so big domestic issues right now? Actually the word if I'm correct the word stepped up was used for structural reforms, but the conclusion is the same Where are you talking about structural reform? So we're progressing economic and monetary union building deepening the pace has slowed down considerably and and and the reason basically is that these are big important changes and therefore they need the support of the people and so in We we I think I said it on another occasion in the in both these areas got to be a humble Are we can design? What's the optimal? Set of measures to take in all cases. We made the examples of structural reforms or economic monetary union deepening but then the timing of Implementation of these measures is an entirely political decision And so I have no doubt About the political commitment By our leaders by our governments by most of our citizens you've seen the euro is now has an approval rate is highest since its beginning so I have no doubt about the political commitment on Deepening the economic and monetary union, but I have no say on its timing Thank you We have two minutes left. There's any further questions One I'm sorry It's to make sure Dave McHugh AP in case there is a no-deal Brexit What could the ECB do to help? Can you give a peek in the toolbox or say anything about that? Well, you know that We We've been we've been working with the Bank of England now for several months We cooperate actively we had a working group Identifying What the main risk could be could materialize in the financial system, of course? and we identified several areas for action one the Potentially the most important one is the area centrally clear derivatives and but then the Commission intervened with the pronouncement basically allowing the UK central clearing Central CCP's To continue serving EU clients and members for a period if I'm not mistaken of 12 months This is called conditional and temporary and conditional equivalence so the This and the other the other areas of non-centrally clear derivatives insurance contracts have they do present risk But they can be addressed and they are being addressed by the private sector So work has been done in the in the financial sector to be prepared of course, we have to see I mean because it's it's such a It's an important event and and it's And it's due its length Also, it's protracted length of time also is is not is not benefiting the overall economic climate in UK, but also you also in the euro area. Thank you. Thank you very much