Benoît Cœuré Member of the Executive Board of the European Central Bank The local impact of the ECB’s monetary policy Les Champs du Possible Châteaudun, 4 October 2018 Euro area economy looking back to five years of uninterrupted growth Rubric GDP and employment Inflation and wage growth (2007 = 100) (annual percentage changes) GDP HICP Employment Compensation per employee 5 110 108 4 106 3 104 2 102 100 1 98 0 96 94 2007 2009 2011 2013 2015 -1 2007 2017 Sources: Eurostat, ECB calculations. Latest observation: 2018Q2. 2018-10-04 – Châteaudun 2009 2011 2013 2015 2017 Sources: Eurostat, ECB calculations. Latest observation: 2018Q2 (compensation), 2018Q3 (inflation). 2 www.ecb.europa.eu © The ECB took firm action against financial fragmentation Rubric Firm access to bank loans: 2014 Firm access to bank loans: 2018 (net percentage of responding SMEs) (net percentage of responding SMEs) Sources: EC, ECB, ECB calculations. Notes: Survey on the access to finance of enterprises (SAFE), Question 9: “Would you say that the availability of bank loans has improved, remained unchanged or deteriorated for your enterprise over the past six months?” April-September 2014. 2018-10-04 – Châteaudun Sources: EC, ECB, ECB calculations. Notes: Survey on the access to finance of enterprises (SAFE), Question 9: “Would you say that the availability of bank loans has improved, remained unchanged or deteriorated for your enterprise over the past six months?” October 2017-March 2018. 3 www.ecb.europa.eu © Policy Rubricmeasures were successful in supporting credit provision to firms Cost of borrowing for NFCs Loans to NFCs (percentages per annum) (annual percentage changes) DE ES FR IT DE EA 7 40 6 30 5 ES FR IT EA 20 4 10 3 0 2 -10 1 0 2004 2006 2008 2010 2012 2014 2016 -20 2004 2018 Source: ECB. Notes: The indicator for the cost of borrowing is calculated by aggregating short- and long- term rates using 24-months moving average of new business volumes. Latest observation: July 2018. 2018-10-04 – Châteaudun 2006 2008 2010 2012 2014 2016 2018 Source: ECB. Notes: Adjusted loans (i.e. adjusted for sales, securitisation and cash pooling activities). Data for Spain from Jan. 2004 to Dec. 2009 are non-seasonally adjusted. Latest observation: August 2018. 4 www.ecb.europa.eu © Structural Rubric factors holding back growth in some regions Long-term unemployment Regional employment (percent of active population) (2007 = 100) Median Median Centre-Val de Loire Centre-Val de Loire 120 21 115 18 110 15 105 12 100 9 95 90 6 85 3 80 75 0 2007 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2011 2013 2015 2017 Sources: Eurostat, ECB calculations. Notes: Data refer to total employment (15 to 64 years) of available euro area NUTS-2 regions. The grey area shows the interval between the 10th and the 90th percentile. Latest observation: 2017. Sources: Eurostat, ECB calculations. Notes: Data refer to the unemployment rate (12 months and more) of available euro area NUTS-2 regions. The grey area shows the interval between the 10th and the 90th percentile. Latest observation: 2017. 2018-10-04 – Châteaudun 2009 5 www.ecb.europa.eu © Institutional quality decisive for economic prosperity Rubric GDP per capita and Worldwide Governance Regulation as a problem (index EU28 2017 = 100; ranking in 2008) (percentage of responding SMEs) 90 FI Worldwide Governance Indicator rank 85 DK SE NL AT 80 UK IE DE MT 75 FR PT CY SI EE 70 ES PL HU 65 BE EU28 CZ SK LV 60 HR LT IT GR BG 55 RO 50 40 50 60 70 80 90 100 110 120 130 140 150 GDP per capita relative to EU28 Sources: Eurostat, World Bank. Notes: The Worldwide Governance Indicator is the composite ranking of average positions in six broad institutional dimensions. Luxembourg is excluded because GDP per capita computations are distorted by, for example, the high number of cross-border workers. Data for Ireland are adjusted to control for the exceptional GDP revision made for the year 2015. 2018-10-04 – Châteaudun Sources: EC, ECB, ECB calculations. Notes: Survey on the access to finance of enterprises (SAFE), Question 0: “How important have the following problems (finding customers, competition, access to finance, costs of production or labour, availability of skilled staff, regulation) been for your enterprise in the past six months?” October 2017-March 2018. 6 www.ecb.europa.eu ©