In my remarks, I will talk in more detail about the implementation of today’s monetary policy decision, which Thomas Jordan has already touched on. I will start, however, by giving you an overview of how we have steered interest rates since the switch to a positive SNB policy rate in September.

I will begin my remarks with a review of developments on the financial markets over the past half-year. I would then like to discuss the lowering of the threshold factor mentioned by Thomas Jordan.

A new era of reference interest rates began at the start of this year. Libor, which had been the key reference rate for several decades and several currencies, including the Swiss franc, ceased to exist in many currencies at the end of 2021. SARON has now fully replaced Swiss franc Libor.

I will begin my remarks with an overview of the situation on the financial markets, before giving an update on the status of the reforms regarding reference interest rates. And in closing I would like to say a few words about our branch office in Singapore, which is celebrating its fifth anniversary. Situation on the financial markets Let me start with the developments on the financial markets.

The monetary policy pursued by the large central banks was once again the focus of attention for the financial markets in the second half of the year. Given moderate inflation growth, financial market participants are expecting only a very gradual normalisation of monetary policy across the world. Against this backdrop, government bond yields have remained persistently low. Muted expectations regarding a move away from expansionary monetary policy, coupled with favourable economic data and good corporate results, have contributed to largely positive risk sentiment on the financial markets.

I will begin by reviewing the situation on the international financial markets. I will then address some developments on the Swiss money and foreign exchange markets – specifically
the establishment of SARON as the leading reference rate for interest rate derivatives and the adoption of a global code of conduct for foreign exchange market transactions.

At the SNB news conference, Andréa Maechler discusses the current situation of financial markets and the negative interest environment. For us, negative rates make only holding money on accounts less attractive but not cash, real estate or stocks. Negative rates reduce the profit of banks and therewith GDP.

The Money Market Event is the biggest feast of the Swiss National Bank and a selected list of money managers that work together with the central bank. It is initiated by important speeches and ended with a generous buffet dinner. In the first speech, Andrea Mächler addressed three points:
The expansion of the SNB balances sheet as measure against the so-called “strong franc” in a historic perspective.
How the SNB takes over currency risks from the private sector.
Details on the balance sheet expansion: Which kind of assets and liabilities does the SNB possess?

In the coming days, I will add annotations and critiques.