policy, it does provide some guidance. households and companies can continue to plan for stable prices in switzerland in the future. conclusion let me conclude. central banks'risk management approach, which is guided by pragmatism, consistency and determination, has served us all well in the fight against inflation so far. we are well advised to stick to this approach. at the same time, we must keep a medium - term orientation and communicate this clearly to the public and the markets. when the monetary policy outlook is very uncertain, an exchange of views as well as the sharing of experiences and research findings between economists from universities and central banks are particularly valuable. that is why i am very much looking forward to the discussions and presentations at this conference. thank you for your attention. 3 / 3 bis - central bankers'speeches

are using incoming data to reassess the desirable path for monetary policy from meeting to meeting. ladies and gentlemen, compared to a year ago, when monetary policy was being tightened with large interest rate hikes, central banks are now proceeding more cautiously. this is because there is less need to further tighten monetary policy given the economic situation. it is not because of a change in central banks'approach, which is still characterised by the three principles of pragmatism, consistency and determination. data - dependent but with a clear medium - term orientation 2 / 3 bis - central bankers'speeches however, proceeding in a data - dependent, meeting - by - meeting manner also entails certain challenges. let me mention two. the first challenge is not to fall into the temptation of reacting to every data surprise with a substantial change in policy. such behaviour would result in an erratic monetary policy. as monetary policy affects the economy only with a certain lag, frequent changes of direction would be counterproductive. thus, while being data - dependent, central banks must maintain a medium - term orientation. their models, which incorporate medium - term relationships between economic variables, can help them achieve this goal. rather than reacting directly to the data, central banks first let their models process the incoming data. by factoring in different assumptions, the models provide decision - makers with scenarios for monetary policy. but models only reflect reality to a limited extent. therefore, outside information – such as discussions with company managers and anecdotal evidence – support central banks in checking the plausibility of the model results. and, finally, central banks have to use judgement in deciding whether a new scenario has become more likely, and whether a change in monetary policy is warranted. a second challenge is how to communicate the currently high uncertainty about the monetary policy outlook while still providing some guidance to households and companies. of course, central banks have to acknowledge that there is uncertainty surrounding the monetary policy outlook. at the same time, they can give households, companies and market participants a compass by clearly communicating their reaction function. this includes information on how they deal with trade - offs. what are their priorities when there are upside risks to inflation, but downside risks to economic activity? the snb has clearly communicated that its focus remains firmly on ensuring price stability. we will not hesitate to tighten our monetary policy further if necessary in order to keep inflation below 2 % on a sustainable basis. although this may not give markets certainty about future monetary