had already steadily weakened against major currencies in the second half of 2014. furthermore, at the start of 2015, there were signs of further easing of monetary policy in the euro area. against this backdrop, the euro was expected to weaken further. in contrast to 2011, the environment at the beginning of 2015 was no longer characterised by swiss franc strength, but by broadbased euro weakness. in these circumstances, the minimum exchange rate was no longer sustainable. the snb could only have enforced it through ongoing foreign currency purchases of rapidly increasing magnitude. however, there would still have been no prospect of a long - term stabilisation of the situation. an uncontrolled expansion of the balance sheet would have compromised the snb ’ s bis central bankers ’ speeches ability to conduct monetary policy in the long term. continuing to uphold the minimum exchange rate was therefore no longer justifiable. delaying any decision to discontinue would also not have helped the situation. on the contrary, if we had not faced facts and had delayed abandoning the minimum rate, the turbulence on the foreign exchange markets would have been no less severe. the impact on the economy would have been just as great, while the losses on the foreign exchange reserves would have been considerably heavier. the swiss franc initially appreciated sharply on 15 january 2015. in the meantime, it has broadly declined, although it is still considerably stronger against the euro than before discontinuation. this is attributable to the persistent weakness of the euro. developments since january 2015 have confirmed that our assessment at the time was correct. current situation the discontinuation of the minimum exchange rate marked a shift in our monetary policy focus. it is now based on two key elements. the first is the negative interest rate, which is currently – 0. 75 %. this is charged on sight deposits held at the snb by banks and other financial market participants. the second is our willingness to intervene in the foreign exchange market as necessary, while taking the overall currency situation into consideration. our monetary policy is thus expansionary and aimed at easing pressure on the swiss franc, thereby ensuring price stability in the medium term. many feared a recession on the back of the discontinuation of the minimum exchange rate and the rapid appreciation of the swiss franc. yet our economy grew by 0. 9 % last year. this may not be a strong growth rate, but it is still a good sign. on the one hand, it

of that mean for inflation? we've come a long way from the 8. 1 % inflation we saw last summer. as i mentioned, annual cpi inflation was down to 4. 3 % in march, 1 / 2 bis - central bankers'speeches led by falling goods price inflation, and we see further declines ahead. that's good news. but many canadians are still struggling to manage the rising cost of living, and prices of many things that people need to buy are still rising too quickly. food price inflation is just under 10 %. we expect food price inflation to come down in the months ahead, but services price inflation will take longer. continued strong demand and the tight labour market are putting upward pressure on many services prices, and those are expected to decline only gradually. we expect it will take until the end of 2024 to get inflation all the way back to the 2 % target. when we met last week, the bank's governing council discussed whether we've raised rates enough, and we considered the likelihood that the policy rate may need to remain restrictive for longer to return inflation to the 2 % target. governing council also discussed the risks around our projection. the biggest upside risk is one i just mentioned - that services price inflation could be stickier than projected. the key downside risk is a global recession. if global banking stress re - emerges, we could be facing a more severe global slowdown and much lower commodity prices. overall, we view the risks around our inflation forecast to be roughly balanced, but with inflation still well above our target, we continue to be more concerned about the upside risks. let me conclude. our job at the bank of canada is to get inflation all the way back to the 2 % target. we are encouraged with the progress so far. and seeing inflation get down to 3 % this summer will be welcome relief for canadians. but let me assure canadians that we know our job is not done until we restore price stability. price stability is important because it restores the competitive forces in the economy and allows canadians to plan and invest with the confidence that their money will hold its value. that's the destination - we are on our way and we will stay the course. with that summary, the senior deputy governor and i would be pleased to take your questions. 2 / 2 bis - central bankers'speeches