In the first quarter of 2013, the global economy was weaker than expected. The recession continued in the euro area. In the US, the recovery remained hesitant and in China, economic activity lost strength. In Switzerland, real GDP rose significantly in the first quarter. However, we expect a perceptible weakening in growth for the second quarter. Overall, we still anticipate growth of 1.0–1.5% for 2013. The risks for the Swiss economy remain high. They continue to originate, for the most part, from the international environment. A weakening in global economic momentum cannot be excluded. Further developments in the euro area financial and sovereign debt crisis remain uncertain. Tensions can reappear at any moment on global financial markets. Domestically, there is a risk that the imbalances on the mortgage and real estate markets will grow, given the sustained period of exceptionally low interest rates. Global economic outlook I would now like to outline the outlook for the global economy and Switzerland in more detail. I will then look at monetary and financial conditions and the SNB’s monetary policy. In the first quarter, the growth of the global economy was weaker than expected, across the board. In many emerging markets, particularly China, economic activity lost strength. In the euro area, the recession continued, and in the US, the recovery remained hesitant. The only advanced economy to gain significant momentum was Japan. However, in the quarters ahead, global growth is likely to firm up gradually.
Thomas Jordan: Challenging economic and financial conditions for the Swiss banking sector Introductory remarks by Mr Thomas Jordan, Chairman of the Governing Board of the Swiss National Bank, at the media news conference of the Swiss National Bank, Berne, 20 June 2013. *  *  *  The Swiss National Bank (SNB) is maintaining its minimum exchange rate of CHF 1.20 per euro. The Swiss franc is still high. An appreciation of the Swiss franc would compromise price stability and would have serious consequences for the Swiss economy. In the current environment, the minimum exchange rate remains important in order to avoid an undesirable tightening of monetary conditions for Switzerland in the event of sudden upward pressure on the Swiss franc. We stand ready to enforce the minimum exchange rate, if necessary, by buying foreign currency in unlimited quantities, and to take further measures, as required. The target range for the three-month Libor will be left unchanged at 0.0–0.25%. Since March, the SNB’s conditional inflation forecast has remained almost unchanged, apart from inflation for the current year, which is slightly lower due to a reduction in the oil price. The forecast is again based on an unchanged three-month Libor of 0.0% over the next three years. For 2013, we now anticipate slightly lower inflation of –0.3%. For 2014, the inflation forecast is unchanged at 0.2% and for 2015 at 0.7%. Consequently, inflation in Switzerland will remain very low in the foreseeable future.