There is agreement, however, that these payments have increased compared with last year's survey and that this trend is likely to continue in future. Wage and salary payments in euros are still not an issue. Employees would not accept wage and salary payments in euros. Furthermore, such a practice would result in substantial administrative complications (social security deductions and taxes in Swiss francs). The selective use of euros in place of the Swiss franc does not create any difficulty with regard to monetary policy. On the one hand, the bulk of payments in Switzerland will probably continue to be effected in Swiss francs also in future. On the other hand, under the current monetary policy strategy, a possible euro-induced decline in the demand for money will not lead to any problems either. Contrary to the previous policy of targeting the money supply, the steering of the interest rate the National Bank pursues today is not dependent on a stable demand for money. The National Bank realises, however, that, as invoicing in euros becomes more widespread, our export industry must bear higher exchange rate risks. BIS Review 73/2002  3
And they need rules that reflect public policy concerns, relating particularly in the case of financial markets to systemic stability, consumer protection and fair competition. I will come back to that. The second main driver of change in the financial services industry in particular is, as I say, the ICT revolution, which has made possible new financial instruments and investment strategies, new means of measuring, monitoring and managing risks and new - and cheaper - delivery, trading and settlement mechanisms and so on, all of which facilitate the greater competition and greater efficiency we need. These global influences are of course at work within Europe, like everywhere else. But change in Europe in particular is being driven also by two Europe-specific factors - the single European market program, which is essentially an advanced, regional, form of the broader international shift towards free trade and the freedom of capital movement; - and the introduction of the euro, which, by eliminating currency risk between the participating countries, is making a substantial further contribution to increasing the depth and liquidity of European financial markets, including the (small-E) euro markets here in London.