Third, the allocation of our purchases across market segments is also state-contingent. For example, the crisis revealed an unprecedented need for short-term liquidity by firms as lockdown measures dried up revenue streams. Firms started to heavily draw down bank credit lines, and year-to-date bond issuance activity by euro area firms is reaching new record levels. At the same time, traditional investors, such as money market funds, shifted their asset allocation to the shortest maturities only. In response to these developments, we decided to shift a significant share of our purchases to the commercial paper market, and to longer tenors, in particular. Today, we see clear evidence of the success of allocating purchases flexibly across market segments. Commercial paper rates for non-financial firms have started to stabilise and issuance at longer tenors is rising, thereby reducing rollover risks and hence uncertainty for firms (see Slide 10). Conclusion Let me conclude. COVID-19 constitutes an unprecedented shock to the global and euro area economy. By how much the crisis will permanently shift economic structures, both within and across countries, remains highly uncertain at the current juncture. But the nature and severity of the shock make it likely that these shifts will be significant. In this uncertain environment, monetary policy needs to play a proactive stabilising role. It needs to restore and preserve financial conditions that are consistent with a return of inflation to levels 6/7  BIS central bankers' speeches  closer to 2% over the medium term.
Jean-Pierre Roth: Demography and economic policy – the challenges ahead Summary of a colloquium by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank and Chairman of the Board of Directors of the Bank for International Settlements, on “Chances et défis du vieillissement” (opportunities and challenges of demographic ageing), at the University of Geneva, Geneva, 10 November 2006. The complete speech can be found in French on the Swiss National Bank’s website (www.snb.ch). *  *  *  What will Switzerland look like in 2050? The demographic changes under way will have a strong impact on the future demographic landscape, with regard to both the working population and the older age segments. The ageing society poses two major challenges for economic policy: ensuring the production capacity of the Swiss economy as well as the continuance of the social security scheme. To address these challenges, an economic policy that promotes productivity increases while guaranteeing economic growth must be implemented with immediate effect. In line with this economic policy, adjustments must be made to our social security system.