rates were regularly higher in europe than in the us. one reason for this was the structural dollar short position of the european banks and their concern that they would not have sufficient dollar liquidity at close of business as a result of poorly functioning money markets. for this reason, the federal reserve, ecb and snb decided to take concerted action. in december 2007, for the first time in its history, the snb was able to provide its counterparties with us dollar liquidity against the usual snb eligible collateral, thanks to a swap agreement with the fed. in this context, it is important to point out that this dollar liquidity had no impact on either monetary policy or the snb ’ s income statement. yet it helped to facilitate refinancing by our counterparties, and thus made a positive contribution towards easing the tension on the swiss franc money market. in this phase, the central banks supplemented their usual remedies with some booster treatments. the third wave of turbulence, in march this year, resulted from acute liquidity problems faced by individual international banks, combined with concerns that the money market problems might become chronic. in this third phase, the snb did not provide any new instruments, preferring to make greater use of our existing tools. in particular, we resumed our us dollar auctions, at which we now offer usd 6 billion on a fortnightly basis. in this way, we are providing the market with a maximum of usd 12 billion. in addition, we are supplying the market with generous amounts of swiss franc liquidity and actively engage in fine - tuning operations whenever necessary. other central banks have opted for more wide - reaching measures over the past few months. for instance, the range of eligible participants and collateral for refinancing operations was expanded. the fed and the bank of england have introduced a new “ collateral swap facility ”, under which the banks can temporarily swap their unsaleable securities against liquid government paper. the pressure on banks to refinance their balance sheets is thus reduced without additional central bank money having to be injected into the market. the fed went even further in providing support during the sale of investment bank bear stearns. it took illiquid and risky securities directly onto its own balance sheet. thus, in the third phase, some countries administered new remedies in addition to the existing ones, and even performed a few emergency operations. in the snb ’ s case, the range of counterparties admitted

ecb ) have significantly reduced the probability of extreme developments in the monetary union, there is still substantial uncertainty in connection with the management of the debt crisis in the euro area. it also remains to be seen how far the upcoming budget consolidation in the us will hamper growth. this question is weighing on the sentiment in the financial markets and the real economy. moreover, momentum in the swiss residential mortgage and real estate markets remains strong, and has led to a further increase in risks for financial stability. global economic outlook i would now like to outline the outlook for the global economy and switzerland in more detail. then i will look at monetary and financial conditions and the snb ’ s monetary policy. in the third quarter of 2012, global economic growth remained weak, while the volume of international foreign trade actually declined. a mild recession persisted in the euro area, and japan recorded strongly negative growth figures. in the us, growth was supported by private consumption as well as the improvement in residential construction investment. the situation varied in the emerging economies. in some countries, there was scarcely any improvement in economic momentum, while in others – such as china – a supportive economic policy led to some consolidation. bis central bankers ’ speeches we still expect that the global economy as a whole will gradually recover. however, we have adjusted our forecast for 2013 slightly down from the last monetary policy assessment. this revision mainly affects the short - term outlook for the euro area. we expect that the euro area will only emerge from the recession during the course of 2013. in the us, the moderate recovery is likely to continue, partly as a result of the favourable developments in residential construction. in the emerging economies, growth should continue to gain momentum. the downside risks for the global economy remain high. the crisis in the euro area continues to weigh on the economic outlook. in september, the ecb initiated a new securities purchasing programme, outright monetary transactions. although this announcement substantially reduced the probability of extreme events and led to an easing in the financial and credit markets, the economic situation in the monetary union remains vulnerable and the level of uncertainty is still considerable. a further source of uncertainty are the upcoming fiscal decisions in the us. swiss economic outlook in switzerland, real gdp in the third quarter increased again following a downturn, due to a temporary recovery in exports. for the fourth quarter, however, we again expect significant weakening in growth. consequently, economic growth for this year is likely to come to around 1. 0 %, as forecast to