This is drawn up quarterly, with each forecast having a horizon of three years. The inflation forecast gives us an indication as to whether our current monetary policy stance is appropriate for keeping future inflation within the range consistent with price stability. It is our compass, so to speak, showing us whether we are heading in the right direction. It plays another important role in that it gives the public an indication with regard to the need for monetary policy adjustments going forward. The inflation forecast is based on the assumption that a given interest rate remains unchanged over the entire forecast horizon. To date this has been the three-month Libor, and from now on it will be the SNB policy rate. This brings me to the third element of our monetary policy strategy. This determines how we communicate the level of money market rates we seek to maintain. To date, we have used the target range for the three-month Libor for this purpose. We will now do so by setting the SNB policy rate. In implementing our monetary policy, we will ensure that the secured short-term money market rates are close to the SNB policy rate. In this regard, we are focusing on SARON, the most representative of the short-term Swiss franc rates. SARON is an overnight rate. Given that we are now focusing on an overnight rate rather than a three-month rate, there is no further need for a target range.
François Villeroy de Galhau: Causes of and answers to the European slowdown Speech by Mr François Villeroy de Galhau, Governor of the Bank of France, at the New York University, New York City, 16 October 2019. * * * Accompanying slides of the speech. Ladies and Gentlemen, dear students, I am very pleased to be with you today. Dear Thomas, both sides of the Atlantic benefit from your skills in economics. The high quality education you students receive here at the NYU Stern Business School will give you the tools to understand and address global challenges. In my introductory remarks today, I will address one of these, the current European slowdown, and quickly elaborate on 3 paradoxes: 1- the causes of the slowdown are mainly outside the euro area, but its effects are very acute on its biggest economy; 2 – the recent monetary policy controversy is of little interest for the future; 3 – the euro area has more policy room than others in the non-monetary domain, but under-uses it. **  I. The causes of the slowdown are mainly outside the euro area, but its effects are very acute on the region’s biggest economy The causes of the slowdown are mainly external to the euro area: uncertainty is undoubtedly the most important; it is mostly man-made, and must also be fixed by man.