firms are fleeing to the euro – 47 % of new loans to firms are currently in euros. nevertheless, this channel is also gradually cooling as the ecb raises its rates. the volume of new euro loans to firms fell by 16 % in january – april. the decline in demand in the economy is documented by the following indicators : household consumption, which is crucial for the future course of demand - pull inflation, fell for the sixth consecutive quarter and is below the pre - covid level. the saving rate is now 21. 7 % ( data for 2022 q4 ), while the long - term average is 12 %. the decline in demand is also illustrated by the fact that prices of new apartments are already falling quarter on quarter. i want to emphasise that there is no wage spiral in the economy. the average nominal wage rose by 8. 6 % year on year in q1. nominal wages increased half a percentage point more slowly than expected in our may forecast, which expects inflation to return to the target in the first half of next year. the average real wage fell by 6. 7 %, decreasing for the sixth consecutive month. for comparison, the average wage at the cnb used to be linked to inflation. however, we managed to renegotiate this with the trade unions, and the average wage at the central bank rose by 4. 5 % this year. we are thus setting an example, not least by showing that inflation clauses can often be changed by agreement of the two parties. these are steps that can be taken to avoid a wage spiral. the decline in real demand means that the economy is below potential output and we have a negative output gap. interest rates are slowing growth in the quantity of money in the economy. inflation pressures are fading as a result. in the speech at the university of economics and business, i also mentioned two problems that are and will continue to be relevant : ( 1 ) the cnb's large balance sheet and ( 2 ) government debt. 3 / 6 bis - central bankers'speeches regarding the cnb's large balance sheet, over the last ten years, interest rates were too low, in fact zero for a long time. in addition, in early 2017, interventions led to an increase in the cnb's balance sheet within four months, or rather in the banking sector's liquidity. it increased from czk 1, 300 billion in december 2016 to czk 2, 300 billion in april

local financial market. at the time, the cnb was just the bank regulator and there were three other supervisory institutions. this government decision made us work hard to take over the others and bring them under the cnb's roof. this was actually not what the government had originally envisaged, but we were lucky and won the battle. some think it was a 1 / 2 bis - central bankers'speeches kind of hostile takeover. no matter what it was, it took some time to complete – parliament did not approve the integration plan until the end of 2005. the cnb became the sole supervisor in april 2006. there is one more important anniversary this year that no one speaks of. ten years ago, at the end of november 2014, the board decided to introduce a supervisory tool to address potential sovereign risk in the banking sector. as far as i know, we were the first and likely the last authority in europe to establish any kind of sovereign risk instrument. every year since 2015, the cnb has conducted a public finance stress test and informed banks whether sovereign exposures above a certain level could be subject to a pillar ii capital add - on. to begin with, we were silent about the introduction of this tool as well. the decision was revealed in june 2015. at the time, it was viewed as a temporary solution before eu - wide regulation kicked in. with the benefit of hindsight, we were lucky to act early, before the window of opportunity was closed by the failure of the high - level working group of the european economic and financial committee to agree on anything in this area. in summer 2015, the eu authorities recommended to " await the outcomes of the basel committee ". we are still waiting. to be honest, the window of opportunity created by the sovereign debt crisis in the euro area was wide open back then – we even managed to convince the ministry of finance to support the introduction of the tool. looking at the state of public finances across a number of advanced economies today, one slogan inevitably comes to my mind as to the future : never waste a good crisis! for now, enjoy the conference. 2 / 2 bis - central bankers'speeches