It needs to recognise that the improving terms of trade driving those improved prospects for activity is simultaneously weighing on both inflation (through the direct and indirect effects of energy price falls) and inflation persistence (by reducing the intensity of the distributional conflict, as the foreign claim on domestically generated economic surplus falls back). Having said that, some part of the recent positive news to UK employment and activity might have a less benign interpretation as regards inflation prospects. If it were to reflect a new positive demand shock, rather than the unwinding of the deterioration in the terms of trade, then – other things equal – it would strengthen the case for further monetary tightening. In that case, the recent improvement in the prospects for UK employment would challenge the view embodied in the MPC’s February forecast that an easing in the labour market – as reflected in higher unemployment, a lower vacancy-to-unemployment ratio, or less job churn – will ultimately weigh against persistent inflationary pressures. In interpreting the implications of recent data for monetary policy, the MPC will need to exercise its judgement about which of these two underlying stories is more relevant. Concluding remarks In February, the MPC signalled that it had adopted a more ‘data-dependent’ stance. This was consistent with establishing a clear inflection point in the upward path of Bank Rate – but not necessarily a pause, still less a turning point.
News conference  Berne, 25 March 2020 Thomas Jordan  Introductory remarks by Thomas Jordan  Ladies and Gentlemen First, on behalf of the entire Swiss National Bank, I would like to express our sympathy to all those directly affected by coronavirus. Swiss society and our country’s economy face enormous challenges. The SNB is working closely with the Federal Council, the authorities and the business community to overcome this crisis. The measures adopted by the SNB complement those of the Confederation and are intended to cushion the economic impact of the coronavirus pandemic. Monetary policy supplements the various fiscal measures taken by the public authorities. The Swiss National Bank has set up the SNB COVID-19 refinancing facility (CRF). This instrument is designed to strengthen the supply of credit to the Swiss economy by providing the banking system with additional liquidity. There is no upper limit on the amounts available under the CRF, and drawdowns can be made at any time. The CRF will be available from 26 March 2020. The CRF operates in conjunction with the federal government’s guarantees for corporate loans. The facility allows banks to obtain liquidity from the SNB, which is secured by these federally guaranteed loans. In taking this action, we are enabling banks to access the required liquidity that will allow them to expand their lending rapidly and on a large scale. The interest rate for these refinancing transactions corresponds to the SNB policy rate, currently −0.75%.