This spurred a surge in household borrowing and private consumption funded by credit. For an extended period the Central Bank’s policy rate hikes primarily impacted the exchange rate and had a more subdued effect on other domestic interest rates, partly because of the glacier bond issues. Fierce competition in the mortgage market between the banks and HFF also undoubtedly delayed the force of the impact that the policy rate increases should have had on mortgage lending rates, including those of the HFF. It should be added that changes in economic aggregates are more difficult to measure in the national accounts during rapid growth episodes, as shown by sizeable revisions to leading preliminary estimates. When the Central Bank raised its policy rate in 2004 and 2005 to counter mounting inflationary pressures, it did so on the basis of available data on macroeconomic conditions that later turned out to give a misleading picture of real developments. Revised statistics published last year showed that the economy expanded by much more in 2004 and 2005 than could be read from data at hand when the Central Bank hiked its policy rate during those two years. When the real outcome was known, it was obvious that the Central Bank should have raised its policy rate by more and faster than it did at the time. Monetary policy faces the challenge that the best available data are always imperfect, but especially so during periods of rapid change.
News conference  Zurich, 17 December 2020 Thomas Jordan  Introductory remarks by Thomas Jordan Ladies and gentlemen It is my pleasure to welcome you to the Swiss National Bank’s news conference. Owing to the coronavirus pandemic, we can unfortunately only meet virtually today. The pandemic is placing a very heavy burden on people across the world, and Switzerland is no different. Our sympathies go in particular to those who have fallen ill themselves or who have lost relatives and friends. In my remarks, I will begin by explaining our monetary policy decision and our assessment of the economic situation. I will then discuss the topic of climate change and the SNB. Fritz Zurbrügg will report on developments in the area of financial stability and the impact of the pandemic on the demand for banknotes. Andréa Maechler will then comment on the situation on the financial markets and will look at the upcoming replacement of the CHF Libor with SARON. We will – as ever – be pleased to take your questions afterwards. Monetary policy decision  The coronavirus pandemic is continuing to have a strong adverse effect on the economy. Against this difficult backdrop, we are maintaining our expansionary monetary policy with a view to stabilising economic activity and price developments. We are keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%. In light of the highly valued Swiss franc, we remain willing to intervene more strongly in the foreign exchange market.