not taken into account in the aforementioned scenarios, given the still - high lack of specifics for key tenets of the programme, is a factor operating in the opposite direction. the ngeu fund is a significant reaffirmation of the european construction process. spain, moreover, would be one of the member states with potentially most to gain, given the comparatively more serious impact of covid - 19 on our economy to date and the high likelihood that its consequences will be more persistent. 2 the risks to financial stability the unprecedented impact of the pandemic on economic activity has entailed a very significant increase in the risks to global financial stability. the forceful economic policy response ( by the monetary, fiscal and supervisory authorities ) and the effect of the farreaching international financial reform implemented in the past decade are helping mitigate and manage these risks. indeed, the financial system has been acting to date as a mitigating rather than an amplifying factor of the impact of this crisis. but we should not be complacent. as i have stressed, the scale of this shock is very great, and its duration uncertain. i shall now review how the main risks in this area have evolved recently, drawing on the analysis of the effect of the crisis on various agents in the economy : non - financial corporations, households, the real estate and financial sectors, and general government. non - financial corporations ( nfcs ) faced this shock from a more favourable financial position than was the case before the global financial crisis. specifically, in recent years they had lowered their debt levels substantially, to below the european average at end2019, and had higher liquidity buffers. moreover, the sectoral distribution of activity was more balanced than prior to the previous crisis. however, the information for the first half of the year shows that nfcs have seen their profitability plummet. their return on assets ( roa ) halved, falling from 4 % to 2 %, and the proportion of nfcs with low profitability increased. simulations by the banco de espana point to a strong contraction in firms ’ profitability in 2020 as a whole, with smes trending more unfavourably, especially those in hospitality and leisure, motor vehicles, wholesale and retail trade, and transport and storage. the simulations on firms ’ liquidity, on the basis of the aforementioned macroeconomic scenarios and incorporating the impact of the economic policy measures implemented, anticipate that the percentage of firms with liquid

of currencies that will be traded at the same price for all time. to clarify this, interventions could be made in the form of futures contracts with a maturity date beyond the date of entry. the single monetary policy entry into monetary union would imply sweden becoming part of the euro area and the european central bank assuming responsibility for monetary policy. target and strategy both the riksbank and the ecb have the task of maintaining price stability and, to the extent that it does not conflict with the price stability target, promoting a balanced development of economic activities. the riksbank ’ s inflation target entails keeping annual inflation as measured by the consumer price index, cpi, at 2 per cent with a tolerance for deviations of 1 percentage point upwards or downwards. given that monetary policy exerts its impact on the economy with a time lag, our work is based in practice on ensuring that future expected inflation is 2 per cent. our underlying assumption is that the time lag in policy is mainly one to two years. however, there is sometimes reason to refrain from achieving the target as defined in this way. this may be the case when inflation is affected by transitory effects, such as quickly rising or falling energy prices or changes in indirect taxes or mortgage interest expenditure. for this reason, the riksbank also makes use of measures of inflation that exclude such effects. inflation measured by the index und1x is one example. moreover, there may be reason after a shock to bring inflation back to the target in the somewhat longer term. this enables us to avoid overly negative implications for production and employment. the ecb measures price stability as a year - on - year increase in consumer prices of below, but close to, 2 procent. the target relates to inflation measured by the harmonised index of consumer prices, hicp. the idea is to reach the goal in the medium term, which implies that the ecb also disregards transitory effects on inflation. consequently, the ecb ’ s definition is similar to our own. there are some differences, however. one is that the ecb ’ s target is defined in terms of hicp. the consumption basket in hicp is narrower than in cpi due to the fact that areas for which statistics are not yet harmonised have been excluded. the differences between hicp and the different measures normally used by the riksbank are generally rather small. another difference is the target level. the riksbank works with a definite central target