These movements reflected the euro’s recovery following the French elections and the attendant easing of political uncertainty. The Swiss franc’s depreciation against the euro and the US dollar since September reflects the fact that it is currently less sought after as a safe haven, because of increased confidence in the euro area’s recovery and the vitality of the global economy. However, we still consider the situation on the foreign exchange market to be fragile. The SNB’s willingness to intervene as necessary therefore continues to be important. In her remarks, Andréa Maechler will go into more detail on the market environment for the Swiss franc. Monetary policy outlook  Ladies and gentlemen, let me summarise my key points. Inflation in Switzerland remains modest, and the recovery of our economy is continuing at a gradual pace. Inflation expectations are well anchored. The rise in oil prices and the weaker Swiss franc have pushed up our short-term inflation forecast slightly. In the longer term, however, inflationary pressure in Switzerland has not increased. Our expansionary monetary policy remains appropriate in order to underpin the recovery, and thereby ensure price stability, while taking due account of economic developments. The SNB is therefore maintaining the negative interest rate, as well as its willingness to intervene in the foreign exchange market as necessary. Ladies and gentlemen, thank you for your attention. It is now my pleasure to give the floor to Fritz Zurbrügg. Page 4/4
This will be built up in good times, when credit growth is higher than normal, with the aim of creating airbags to protect the banking sector in troubled times. So far, this is the instrument on which international agreement has been reached in the field of macroprudential policy, that is a policy that comprises measures to prevent financial crises that are directed at the system as a whole. A leverage ratio requirement will also be introduced under which, irrespective of risk weights, a bank's assets may not exceed 33 times its own capital. A leverage ratio requirement represents an extra safety measure that also limits the banks’ possibilities to use internal risk models to actually keep risk weights down. Basel III also sets quantitative standards for the banks’ liquidity, a short-term (Liquidity Coverage Ratio, LCR) and a long-term (Net Stable Funding Ratio, NSFR). The short-term measure means that every bank should have sufficient liquid assets to survive for at least 30 days in a stressed scenario. The long-term measure, in principle, limits the gap between the maturity of a bank’s assets and the maturity of its liabilities. The standards stipulated in the Basel III Accord will be implemented in national legislation during the 2010s and should be implemented in their entirety by 2019, with several interim targets along the way. 2  BIS central bankers’ speeches  Establishing better regulations on the banks’ capital and liquidity represents a major step forward.