The reason for this adjustment is that the future of the Libor is not guaranteed. The UK’s Financial Conduct Authority will only ensure that the Libor is maintained through to the end of 2021. The volume of money market transactions underlying the Libor has dwindled. This has also placed a question mark over the basis for its calculation. Given that our monetary policy is focused on the medium term, we are already adjusting our strategy at this juncture. Page 1/5  Berne, 13 June 2019 Thomas Jordan  News conference  Our inflation forecast is based on the assumption that a specified interest rate remains unchanged over the entire forecast horizon of three years. The current forecast extends beyond the end of 2021 for the first time. The introduction of the SNB policy rate ensures that it will be based on the same interest rate over the entire horizon. So what is the SNB policy rate, and what changes does this entail for our monetary policy strategy? In answering these questions, please allow me to give you a brief recap of the three elements of our strategy and explain the impact this adjustment will have. The first element is our definition of price stability. The SNB equates price stability with a rise in the Swiss consumer price index of less than 2% per annum. Price stability is to be ensured over the medium term. This primary goal of our monetary policy remains unchanged. The second element is our conditional inflation forecast.
This is primarily attributable to a rise in the prices of imported goods. The longer-term inflation forecast is virtually unchanged. For 2019 it stands at 0.6%, up from the figure of 0.3% last quarter. For 2020, we anticipate an inflation rate of 0.7%, compared to 0.6% last quarter. The forecast for 2021 is 1.1%, 0.1 of a percentage point lower than last quarter. The conditional inflation forecast is based on the assumption that the SNB policy rate remains at – 0.75% over the entire forecast horizon. Global economic outlook  Our inflation forecast is based on assumptions regarding the development of the global economy. The signs from the global economy remain mixed. GDP growth picked up in the first quarter, with all large economies recording above-average expansion. However, manufacturing output again tended to weaken in a number of countries. This has been accompanied by subdued capital spending and a decline in the global trade in goods. The weakening in industrial activity is attributable to various factors, including difficulties faced by specific sectors – in particular the automotive industry – as well as the impact of protectionist measures and increased uncertainty. On the labour markets, the signals have remained positive overall. Employment figures have risen again in the advanced economies. Unemployment has continued to decline, and is now  Page 3/5  Berne, 13 June 2019 Thomas Jordan  News conference  at or close to historic lows. This favourable situation on the labour market is supporting consumer demand.