news conference berne, 14 december 2017 fritz zurbrugg introductory remarks by fritz zurbrugg in my remarks today, i would like to address some of the developments currently taking place in the field of financial stability. i shall look at the big banks first before turning to the domestically focused banks. i will conclude with a few words on the new banknote series. big banks as thomas jordan has already noted, the international economic environment has continued to improve since the last news conference in june. conditions on the financial markets have remained stable. premia for bank credit default swaps, for instance, have barely changed since june. premia have thus settled at lower levels again following the turbulence in 2016. against this positive backdrop, both of switzerland ’ s big banks remain on track to meet the requirements of the ‘ too big to fail ’ regulations with respect to resilience. this first pillar of the regulations covers requirements pertaining to the going - concern loss - absorbing capacity of systemically important banks. both credit suisse and ubs already comply fully with the final 1, risk - weighted requirements. however, further improvement is needed with respect to the leverage ratio. both of the big banks have also made progress on the second pillar of the regulations, ‘ resolution ’, which covers the orderly restructuring and wind - down of a bank that can no longer function as a going concern and is thus deemed to have become a gone concern. with a view to managing such a crisis scenario, credit suisse as well as ubs have increased their gone - concern loss - absorbing capacity by issuing further bail - in instruments, which can be converted into equity in the event of impending insolvency. as we explained in our financial stability report published in june, since the ‘ too big to fail ’ regulations came into force, 1 final requirements refer to the requirements that will apply after expiry of all transitional provisions, and in particular to the qualitative requirements for going - concern capital. page 1 / 3 berne, 14 december 2017 fritz zurbrugg news conference credit suisse and ubs have also taken important organisational steps to improve their resolvability. despite these positive developments, the two big banks still need to make further progress if they are to fully comply with the second - pillar requirements. this applies both to their gone - concern loss - absorbing capacity and their resolution planning. full compliance with all of the ‘ too big to fail ’ requirements will further strengthen the big banks

growth - trade in goods and services and additions to inventories. private domestic final purchaseswhich is often a better signal of the underlying strength of demand in the economy - grew 3. 1 percent in the first three months of this year, almost exactly the pace in the second half of 2023. i will be watching closely to see whether this measure of economic activity in the first quarter continues in the second. the blue chip consensus of private - sector forecasts projects real gdp growth of 2. 1 percent this quarter, with only a slight moderation in personal consumption expenditures ( pce ) from the first quarter. others, like the atlanta fed's gdpnow model, have a higher forecast. 1 / 5 bis - central bankers'speeches nevertheless, there are several reasons why i do expect some moderation in economic activity. one sign of moderation is that retail sales were flat in april and revised down in the previous two months. retail sales are an important component of consumer spending, so this suggests that consumers may be tempering their purchases. we have also seen credit card and auto loan delinquency rates rise above their pre - pandemic levels, which indicates that some consumer segments are under stress to support their spending levels. that said, services spending data are continuing to look solid and should hold up overall spending in this quarter. another sign of moderation in the economy comes from the institute for supply management's ( ism ) survey of purchasing managers, those who make spending and investment decisions for businesses. for the first time in four years, the indexes for surveys of both manufacturing and non - manufacturing businesses slipped below 50 in april, indicating that production in these businesses was contracting. this wasn't surprising for manufacturing businesses, since they have been reporting weakness in employment and inventories for some time. the surprise was that the survey of nonmanufacturing businesses, representing the lion's share of u. s. output, fell below 50, indicating a deceleration in activity. this has not happened since december 2022. ism results can move around from month to month, but if these numbers are sustained, it would be indicative of slowing economic activity beyond manufacturing. one month does not constitute a trend, but this data suggests that policy is doing its job to moderate aggregate demand, which will support renewed progress in lowering inflation. now let me speak about the labor market. the labor market is still relatively strong and supporting a solid pace of job creation