competition. this is certainly not our intention. negative interest is a monetary policy measure that – like any other form of interest rate change – affects different industries and companies in different ways. negative interest is intended to make it less attractive to hold large amounts of liquidity in swiss francs. it is thus logical from a monetary policy perspective that banks which hold large quantities of swiss franc liquidity relative to the size of their balance sheets should shoulder a heavier burden. as already mentioned, the introduction of negative interest rates on sight deposits at the snb has also caused longer - term interest rates to fall. and yet, we have been living through a period of exceptionally low interest rates for around six years already, with even long - term investments bearing virtually no interest. the swiss are a nation of savers and many people are concerned about low interest rates. i understand this, however we should not forget that what really counts for savers is not the nominal but the real ( i. e. inflation - adjusted ) interest rate. for some time now, inflation has been very low and now it is even negative. if inflation is negative, the real interest rate is higher than the nominal interest rate. as chart 5 shows, there have often been periods in the past when real interest rates were even lower than they are today. during this challenging phase for the swiss economy, it is important that the negative interest rate be allowed to take effect and help to bring about a weakening of the swiss franc. efforts to circumvent negative interest rates by obtaining exemptions or shifting to cash are not in the interests of switzerland as a whole in the current climate. interest rate and exchange rate developments in recent weeks suggest that our monetary policy measures are gradually gaining traction. economic outlook by introducing the minimum exchange rate, the snb moderated the risks and adjustment costs to which the swiss economy was exposed and bought it some time to adjust to a stronger franc. we are aware that the discontinuation of the minimum exchange rate will mean that switzerland has some difficult times ahead. the higher swiss franc exchange rate – and especially the speed of swiss franc appreciation since the discontinuation of the minimum exchange rate – is particularly challenging for exporters and industries facing competition from imports. bis central bankers ’ speeches in 2014, the swiss economy recorded year - on - year growth of 2 %. this increase was slightly above long - term potential growth and reflects the robust state of our economy. the exit from the

the materialisation of new risks. the last 18 years have been particularly impressive from that standpoint. those risks are probably the unavoidable and necessary counterpart of the immense chances that science and technology on the one hand, and the success of emerging economies and globalisation on the other, are bringing about in the world economy. being intellectually and conceptually ready is extremely important. incidentally, that is the reason why financial stability should continue to be of the essence and be a constant inspiration for monetary policy. second, we have to fully accept that our economies, as well as the global economy, are experiencing a period of very rapid structural changes. i would fully subscribe to alan ’ s remark that “ the economic world … is best described by a structure whose parameters are continuously changing ”. it is even truer in europe. because in addition to the impact of science and technology, in addition to the effect of globalisation, in addition to the very rapid demographic changes that characterise the industrial world, we also have to take into account the structural transformations that europe has boldly marshalled for itself : the single market, the single currency, the historic enlargement. but the lesson is valid for all. robustness in the present situation is key and we should not depend on a single model which would necessarily impoverish considerably the wealth of information needed for an enlightened decision. third, i would stress more than ever for the future the concept of credibility. it is because the fed has, throughout the last 18 years, been very highly credible that remarkable successes have been achieved on price stability, even without what i would consider as a precondition for anchoring inflationary expectations : a quantitative definition of price stability. in all difficult episodes and crises the credibility of the fed has been decisive in the effectiveness of its handling of the situation. in the case of the governing council of the ecb i have explained that our credibility has enabled us to regain full control of inflationary expectations with remarkable efficiency over the last two years. and this was because observers and market participants rightly had the intimate conviction that we intended to be absolutely ready to act at any time if needed and were not inhibited in any respect either by unconditional commitments – that we have always carefully avoided – or by any kind of well intentioned public pressures coming from many circles, including the political sphere, of which we were not particularly deprived since the setting up of our institution. i thank you for your