, the swiss franc is currently significantly overvalued. monetary policy is geared towards this challenging set of circumstances, and is guided by the snb's willingness to take an active role in the foreign exchange market and apply negative interest rates. this twopronged approach is designed to ease the upward pressure on the swiss franc. however, in the current climate there is, regrettably, no easy solution that would absorb all external disruptions. we must accept these challenging economic conditions for the time being. the snb is aware that many companies find themselves in a difficult situation. and it has great respect for the challenges facing switzerland's businesses and their staff. bis central bankers ’ speeches

people ’ s confidence by producing significant negative effects on corporate finance. bis central bankers ’ speeches c. monetary base target and asset purchase target as i mentioned earlier, i believe that it is desirable to aim to achieve the price stability target of 2 percent as a medium - to long - term goal and i expect that the road toward this goal will be long. therefore, i believe that the challenge from now on is reforming the policy framework, which is intended to provide solutions in the short term, so as to adapt it to a long - term initiative. the first thing the bank should do for that purpose would be to make the asset purchase operation more flexible and also explore flexible approaches to the monetary base target. let me cite a specific example. since the introduction of the negative interest rate policy, there have been some cases in which bid prices for the bank ’ s asset purchase offers were unusually high compared with market prices or in which the difference between the minimum successful bid rate and the average successful bid rate was very large. this situation represents the realization of the theory that if the bank offers a higher purchase price than the market price, the offer always attracts willing sellers. therefore, it may be said that the buildup of the monetary base is proceeding even amid the negative interest rate environment. however, if we look at the situation from another angle, it can be said that there is a reasonable chance that unless the bank continues to purchase assets at higher prices than market prices, this will result in undersubscriptions, and the buildup of the monetary base will be impeded. the bank is taking such measures as eliminating abnormal bids, imposing bidding limits, and excluding issues which were purchased at abnormal prices from eligible assets. i believe that it is appropriate to give consideration to avoid distorting market price formation by flexibly conducting these market operations as necessary. as a result of such operations, the bank may fall slightly short of its asset purchase target by asset class and the monetary base target of 80 trillion yen. however, if the bank is to ensure the sustainability of its current policy, i believe that conducting such operations would be inevitable. we must pay sufficient attention to the risk that the failure to achieve the targets will be mistaken as tapering, triggering an unexpected reaction. however, given that the bank ’ s asset purchases have proved to be so effective in lowering various interest rates, i take the view that there would be no problem if the bank ’ s purchases fall slightly short of the targets as a