Thomas Jordan: Monetary policy in the interests of the country as a whole

Speech by Mr Thomas Jordan, Chairman of the Governing Board of the Swiss National Bank, at the 111th Ordinary General Meeting of Shareholders of the Swiss National Bank, Berne, 26 April 2019.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Mr President of the Bank Council Dear Shareholders Dear Guests

A warm welcome to you all to our Annual General Meeting. Engaging with the general public across Switzerland is very important for us. It therefore gives me great pleasure to speak before you here today, and I hope I will have the opportunity to talk with as many of our shareholders as possible over refreshments afterwards.

In my position as Chairman of the Swiss National Bank's Governing Board, I receive a lot of correspondence from people throughout our country. In one such letter, the owner of a family business in northwestern Switzerland described how she had struggled for years to hold on to customers, only to have to now close down anyway as the strength of the franc has made competition from neighbouring countries simply too great. In another letter someone wrote that despite his having had to pay ever higher pension fund contributions over the past 15 years, there has been no increase in his projected retirement savings. In fact, they have even declined. He attributes this to what he refers to as 'minus interest'.

Ladies and Gentlemen, letters such as these give us a picture of the key issues of the day for people in Switzerland, and how their lives are affected by specific economic circumstances. We always find this informative. However, the SNB's monetary policy can never be focused solely on individual needs and concerns. Instead it must serve the interests of the country as a whole. And unfortunately, you can't have your cake and eat it, as the saying goes. Or in the case of the two letters I quoted, you can't have higher interest rates and a weaker Swiss franc at the same time.