activity in the emerging economies. in the euro area, however, growth slowed markedly in the third quarter. the favourable developments in germany ’ s economy differ from those in the peripheral countries of the euro area, with their weak growth. the recent financial market turmoil is likely to hamper activity in the euro area. although domestic demand is gradually firming up in the us, the momentum is insufficient for a sustainable reduction in unemployment, which remains high. in addition, construction investment is suffering from the situation on the real estate market. consequently, gdp growth in the us will remain modest. the vigorous economic momentum in the emerging economies is likely to provide positive stimulus for global growth in the future. the snb has made slight downward revisions to its growth forecasts for the global economy, mainly for europe in 2011 and 2012. uncertainty with regard to global economic developments remains very considerable and the risks are still to the downside. swiss economic outlook growth of the swiss economy remained robust in the third quarter. consequently, utilisation of production factors increased. technical capacity utilisation has returned to a normal level in manufacturing, while in the construction industry it is in fact considerably higher than the long - term average. employment also increased moderately and unemployment declined further. however, the indications of a significant slowdown in growth increased. goods exports stagnated from june to october, mainly due to weaker demand from europe. exports of services declined most recently. inflation, as measured by the national consumer price index, fell to 0. 2 % in november. the decrease over recent months is mainly attributable to the fall in the prices of imported consumer goods. accordingly, the core inflation indices calculated by the snb were somewhat higher, and have remained steady since the last monetary policy assessment. for the coming months, the snb expects economic growth to continue. however, it is likely to be significantly lower in the quarters ahead – a development attributable to both the generally subdued economic activity in the industrialised countries and the appreciation of the swiss franc. consequently, the snb expects gdp to grow by some 1. 5 % in 2011, following growth of about 2. 5 % in the current year. monetary and financial conditions monetary and financial conditions in switzerland are shaped by the expansionary monetary policy. since mid - september, the three - month libor has remained fairly constant within the lower part of the target range. yields on high - quality swiss bonds remain at a low level, despite the latest

philipp hildebrand : global and swiss economic outlook introductory remarks by mr philipp hildebrand, chairman of the governing board of the swiss national bank, at the end - of - year media news conference, zurich, 16 december 2010. * * * the swiss national bank ( snb ) is maintaining its expansionary monetary policy. it is leaving the target range for the three - month libor unchanged at 0. 00 – 0. 75 %, and intends to keep the libor within the lower part of the target range at around 0. 25 %. the global economic recovery is continuing. while the growth dynamic in emerging economies is vigorous, the recovery in the industrialised economies remains modest overall. growth in switzerland was robust in the third quarter of 2010, but the weakening of exports, in particular, points to a significant reduction in growth in the quarters ahead. the snb expects gdp to grow by some 1. 5 % in 2011, following growth of about 2. 5 % in the current year. monetary policy operates in an environment of heightened uncertainty. concerns about stability in the euro area have led to renewed financial market tensions. against this backdrop, the swiss franc has again appreciated. should these tensions be exacerbated and put a strain on economic developments in the euro area, this would also have a detrimental effect on the swiss economy. if a deflation threat emerges, the snb would take the measures necessary to ensure price stability. the snb ’ s conditional inflation forecast for 2012 and 2013 is slightly below the september forecast. this correction is the result, in particular, of the less favourable economic outlook for europe compared with the last assessment. for 2011 it is marginally higher, due mainly to a higher price for oil. assuming an unchanged three - month libor of 0. 25 %, average inflation for 2010 is expected to amount to 0. 7 %, for 2011 to 0. 4 % and for 2012 to 1. 0 %. the conditional inflation forecast shows that there is no threat to price stability in the short term. however, the rising path in 2012 and 2013 shows that the current expansionary monetary policy cannot be maintained over the entire forecast horizon without compromising long - term price stability. the inflation forecast is still associated with a very high level of uncertainty. global economic outlook i would now like to take a closer look at the economic situation and at monetary conditions. overall, the recovery in the global economy continued, encouraged by expansionary economic policies and vigorous economic