samchain/econo-pairs-v1 huggingface dataset:
There is a risk that the shortages we see in the labour market, and which clearly motivate wage increases for certain professional groups, lead to an inflationary rate of wage increase. It is therefore important for the Riksbank to analyse the supply side of the labour market. So far there is mainly a shortage of persons with certain healthcare training and of teachers in science and technical subjects. In the longer term, however, a lower supply of labour is expected and an increase in demand. The population increase that Sweden has experienced during the 1990s will gradually decline and with 13 effect from 2010 growth in the working population will be negative. The large population growth among the younger and older age categories risks reducing labour force participation, as these age groups generally have a lower participation than average. In addition, there is a proposal for shorter working hours with effect from 2004, which risks reducing the labour supply measured in hours even further. Wage development during the forecast period  Over the past year employment has developed at a surprisingly strong rate, despite the subdued demand in the economy. The labour force reserve should be regarded as small, if one uses the registered labour force as a measure. The percentage of unemployed and persons in labour market policy programmes amounted to 6.7 per cent in September.

There were also considerable unused resources following the crisis at the beginning of the 1990s, which could be put into use when the economy recovered. Between the years 1991 and 1994 approximately 500 000 jobs disappeared; many of those who lost their jobs left the labour force but have returned as economic activity has picked up. Even today we have not returned to the employment levels prevailing before the crisis in 1991. When demand in the economy slackened in connection with the international downturn in economic activity last year, many companies chose to retain personnel because unemployment was at a low level and it would be difficult to obtain new labour. As a result, productivity developed weakly during 2001. Compared with earlier economic downturns, the decline in productivity was modest. Now that companies have begun to utilise more effectively the labour they had retained, we can see that productivity has increased by 2.6 per cent during the first half of this year, compared with the equivalent period last year. The fact that a large part of the increase in productivity in the 1990s can be attributed to certain industrial sectors, such as the IT and telecommunications sector, whose relative significance has declined, indicates that productivity will grow at a more modest rate in future. However, a continued macroeconomic stability that facilitates long-term decision-making, a higher level of education during the 1990s and certain improvements in competitive pressure indicate that 6 productivity growth can be higher in future than during the 1970s and 1980s.
The Bank of Albania is very heedful to external balances of the Albanian economy, regarding their correction as one of the main priorities of the country’s macroeconomic policies. This objective assumes more importance against the backdrop of recent developments in global financial markets. In the long run, its attainment requires ongoing structural reforms, which will enhance competitiveness of the Albanian economy and will generate higher revenues from the export of goods and services. Monetary inflationary pressures remain subdued in the medium run. Monetary expansion has maintained stable annual growth rates during the year, resulting 10.4% in September. Public sector demand for funding has been downward in recent months, making the private sector’s demand provide the largest contribution to money supply growth. Private sector credit grew 14.0% in September, marking a slight acceleration compared with the first half of the year. However, as we have constantly stated, the relatively sluggish performance of private sector credit reflects mostly its weak demand. The banking sector appears liquid and well capitalized to credit the Albanian economy, but it has increased its prudence in terms of lending, thus reflecting the new reality of the Albanian economy and global financial markets. The Bank of Albania assesses that, within the parameters of prudence, there is room for a more rapid growth of credit and for supporting sound investment projects by the banking sector. On our behalf, we will continue to support the financial system with liquidity and monetary stimuli in order to boost lending.

On the other hand, the need of private businesses to carry out new investments has been low, against the backdrop of a moderate demand for goods and services and the existence of spare capacities in production. Fiscal policy has been stimulating during 2011. For the first ten-month period of the year, budget deficit posted ALL 30.9 billion or about 33.0% higher than a year earlier. The performance of budget deficit has been determined by the sluggish increase in expenditures and revenues by an annualized rate of 3.9% and 1.4%, respectively. The stimulating fiscal  BIS central bankers’ speeches  1  policy has been winding down steadily following the first quarter of the year, as also shown by the decelerated increase in public spending and budget deficit. This fiscal stance has contributed to maintaining the level of public debt under control. The Bank of Albania assesses the latter as one of the most essential indicators of macroeconomic stability at home. In this context, we encourage fiscal authorities to take appropriate measures, in order to ensure long-term sustainability of public debt. Foreign demand has supported the Albanian economic growth, notwithstanding the concerns surrounding the global economy and especially our trading partners. Albanian exports continue to grow, albeit at decelerated paces compared with the previous year. Exports grew 27.3% in the third quarter of the year, while imports grew 8.6% over the same period. Trade deficit increased 6.8% in the first nine-month period of the year.
In this step, the fixed interest rate for one-week repo auctions will be determined by adding 50 basis points to the declared overnight borrowing interest rate of the Central Bank. Therefore, the fixed interest rate for one-week repo transactions will become the reference (policy) interest rate of monetary policy. In the second step, the difference between the one-week repo auction interest rate and the overnight borrowing interest rate may be increased. The CBT may aim to create the secondary market average overnight interest rate around the one-week repo auction rate. The difference between the one-week repo auction interest rate and the overnight borrowing interest rate may be increased either by raising the one-week repo auction interest rate if the Monetary Policy Committee (Committee) decides that monetary tightening is required, or by lowering the overnight borrowing and lending interest rates if the Committee decides not to make any change in the policy interest rate. In this period, the differences between the oneweek repo auction interest rate and the overnight borrowing and lending interest rates may not always be symmetrical and will be determined by the Committee as an element of the operational framework of monetary policy. As a result, some of the measures taken in the foreign exchange and Turkish lira markets during the crisis are planned to be withdrawn gradually.

In line with the cyclical situation, this policy has provided its stimulus through the key interest rate cut and ongoing liquidity injection into the banking system. We have also revised the banking system regulatory basis from the viewpoint of easing it, in order to stimulate lending by the banking system. I avail myself of the opportunity to reiterate that the banking system remains profitable, liquid and well-capitalised. Safeguarding the stability of this system will always be on our focus. BIS central bankers’ speeches  1  Third, reducing uncertainties and risk premiums in the economy is an important priority. As I have already stated, these uncertainties stem, to a great extent, from the foreign market, but a part of them stems from the Albanian economy. Without intending to make a list, I will mention just a few: •  Reducing informality should be a primary objective. Besides outflows in public finances, informality brings hidden costs in terms of diminishing competition, inefficiency in terms of lack of balance sheet transparency, and artificially increased financing costs to businesses. •  Fostering the financial system infrastructure protection is another aspect deserving attention. The Bank of Albania signed and has already made effective a cooperation agreement with the People’s Bank of China, which also provides for the possibility to obtain liquidity in case of need. An important step in this regard is the agreement between the Deposit Insurance Agency and the European Bank for Reconstruction and Development to increase the deposit insurance coverage.
The chart shows income on the horizontal axis, and health expenditure on the vertical axis. Norwegian health service expenditure is on a par with or higher than in that of other western countries, with the exception of the US, Germany and Switzerland. However, as a percentage of income, health expenditure in Norway is still not particularly high. A further reason for the situation outlined above might be the composition of the population. We know that in a few years health expenditure will rise sharply because of an ageing population. However, current demographic trends do not indicate particularly strong pressures. The challenges will increase considerably in the years ahead. Continued growth in incomes and an ageing population will boost demand for health and care services. Moreover, it will be possible to offer services and forms of treatment that are not available today. All this has to be provided for within tight personnel and budget constraints. The increase in social security expenditure on pensions will lay claim to a steadily increasing share of overall central government expenditure. Even with sizeable government financial assets, these resources will primarily be used to finance the increase in pension expenditure associated with the ageing of the population. Taxes cannot be increased unaccompanied by a weakening of the position of the business sector. Therefore, it would be inappropriate to base policy decisions on the assumption that growth in public expenditure items other than pensions can exceed GDP growth. Allow me to illustrate this.

At a premium, businesses can hedge against short-term fluctuations in the krone exchange rate. The fluctuations are not greater than in other countries with a floating exchange rate. In 1996 and in the autumn of 1998, Norges Bank attempted to attenuate movements in the krone exchange rate through exchange market interventions. On both occasions, interventions prompted a game situation between the central bank and market participants, as was also the case during the currency crisis in the autumn of 1992. When a central bank trades its own currency, market operators make a play for profits on the premise that the exchange rate does not reflect market fundamentals. In a world where capital flows freely, this game situation can quickly trigger large capital movements. The experience of the 1990s shows that Norges Bank does not have the instruments to fine-tune the krone exchange rate. Today’s monetary policy The objective of monetary policy is exchange rate stability against European currencies, defined as the euro from 1 January. Norges Bank’s mandate - which is the Exchange Rate Regulation - takes into account that the krone may remain outside its normal range. The Exchange Rate Regulation states that “in the event of significant changes in the exchange rate, monetary policy instruments will be oriented with a view to returning the exchange rate over time to its initial range”. The concept “significant changes” is not quantified and must be given an economic content.
2.4  External sector  Zambia’s external position continues to show remarkable improvements as reflected in the build up of gross international reserves to 3.6 months of import cover in 2007 from 0.9 months of import cover in 2001. Preliminary assessment is that Zambia’s surplus trade balance rose to US $ million compared to the deficit of US $ million in 2001. Similarly, the current account deficit as a percentage of GDP reduced to 4.4% in 2007 from 19.1% in 2001. This outturn was mainly attributed to high receipts from increased copper exports following increased production and record high prices on the international market due to strong demand mainly from China. Coupled with this, between 2000 and 2007, nontraditional export earnings rose by 260% from $ 255.7 million in 2000 to $ 920.7 million in 2007 with commodities such as sugar, copper wire and tobacco, coupled with receipts from tourism making notable contributions. In addition, the attainment of the enhanced HIPC completion point in April 2005 and Multilateral Debt Relief Initiative (MDRI) in 2006 provided for cancellation of (IMF, IDA and ADB) debt resulting in a reduction in debt stock to about US $ billion in 2007 from the end-2001 debt stock of US $ billion. The debt relief and increased budget support from cooperating partners also helped strengthen the external position. The foreign exchange market is liberalised, therefore the Kwacha is determined by demand and supply conditions in the market.

The potential benefits of a well integrated ICT in agriculture are diverse and include: •  transparent dissemination of information such as weather patterns, seed and fertilizer use, availability and distribution;  •  easy accessibility to suppliers of inputs;  •  common distribution of information on market prices of crops; and  •  generally bringing together of suppliers and buyers of crops. Government has put agriculture at the core of rural development and poverty reduction as well as employment creation. It is therefore important to note that the expansion of ICTs in rural communities is more required now than ever before, as most information is now  4  BIS Review 76/2008  disseminated through internet and cellular phones. These facilities will help uplift the living standards of rural communities. 3.2  Agriculture  Zambia’s agriculture sector has enormous potential to become a major grower and exporter of agricultural and horticultural produce. The country has an abundance of quality land, water (over 40% of fresh water resources in Southern Africa) and ideal climate all suited to a wide range of agricultural products. Only 15% of Zambia’s 60 million hectares of arable land is under cultivation. The recent surge in food prices in the world presents an enormous opportunity for Zambia to become the food basket of the sub region. This can be achieved by re-doubling efforts to boost agricultural productivity coupled with substantial increase in infrastructure investment to ease supply bottlenecks that are pushing up prices.
(ii)  Banking supervision  This potential conflict between monetary policy and maintaining the stability of the banking system is not one which has greatly troubled most western industrial countries in recent years. But in some transition economies, such conflicts have been real. In most, the problem has not been so much to maintain the stability of the banking system as to create a robust banking system from a number of often insolvent state-owned banks spun off from the old monobank, together with newly created commercial banks whose behaviour has frequently been far from prudent. BIS Review 33/1997  -7-  In contrast to the diverse arrangements in the west, banking supervision in transition economies is nearly always the responsibility of the central bank (although in some cases the Ministry of Finance is also involved in the licensing of banks). An exception is Hungary, where supervisory responsibilities have in large measure been transferred to the State Banking Supervision Office: the central bank is nominally responsible only for monitoring banks’ liquidity and foreign exchange positions, although in practice its role extends rather more widely. In most of the countries - especially in those with hopes of acceding soon to the EU - banking legislation approximating to western standards is (or is about to be) in place. But in practice, banking supervision has proved a difficult topic to master.

We have given advice principally on core functions such as monetary policy and operations, the development of money markets and payment systems, the management of government debt, and banking supervision; but our help has also been sought in some less obvious matters such as the physical security of central bank buildings and their contents. The assistance is provided through our experts visiting other central banks and by their staff coming on study visits to London, as well as through seminars and workshops here and abroad. In the earlier years most of these events were essentially training courses. But increasingly the participants from many countries are able to contribute more themselves to the discussion so that they are now learning not only from our own experience as central bankers, BIS Review 33/1997  -2-  but also from each other. And in some instances, their experience may well hold lessons for us. Since 1990 over 4,000 staff of other central banks - two thirds of them from the transition economies - have participated in these various events. The work of the Centre for Central Banking Studies, and the other inter-bank links we maintain (notably between supervisors) give us, I believe, a privileged perspective on the development of central banking across Europe. The analysis below - particularly the Eastern European sections - is very largely the work of Lionel Price, the Centre’s Director, and his staff.
For example, there may sometimes be a little too much focus on the potential antagonism and differences of opinion within the Board – and in the worst case on a person rather than a policy. But one positive effect that people perhaps do not think about is that topical and important issues, often those in the forefront of academic research, are quickly implemented in the Riksbank’s practical work. The fact that the Executive Board publicly debates what role the policy rate should play to influence household debt means that the Riksbank’s analysis apparatus is activated on this issue to a greater extent than would have been the case without this open discussion. Although I would not say that there are any more concrete results yet, there is definitely a lot of deliberation being put into this issue. I do not believe that this would have been the case – at least not to the same extent – if all of the Board members were agreed that the repo rate should be held slightly higher to subdue household debt. In other words, the open debate hopefully helps us to move forward in this field. References Armelius, Hanna and Hans Dillén, “The relation between household saving and falls in house prices”, Economic Commentary no. 4, 2011, Sveriges Riksbank. Assenmacher-Wesche, Katrin, and Stefan Gerlach (2010), “Monetary policy and financial imbalances: Facts and fiction”, Economic Policy 25, pp. 437–482.

This means that the discussions conducted by the Executive Board take place on an open stage, almost, through the publication of the minutes from the monetary policy meetings and through the speeches held. In many other central banks these differences of opinion never see the light of day. 27  Svensson (2012a). The estimate is of course uncertain. As shown in Svensson (2012a), a 95-per cent confidence interval for the estimate 1.3(=1/0.75) percentage points gives an interval between 1/1.1= 0.9 percentage points and 1/0.4=2.5 percentage points, corresponding to a confidence interval for the estimate 65,000 unemployed between 45,000 and 125,000. An estimate using the Riksbank’s model Ramses, in accordance with the effects of various repo-rate paths as described in Svensson (2010), leads to roughly the same estimate of 1.2 percentage points. 28  If 3 percentage points lower unemployment corresponds to around 10 per cent higher housing prices, then 1.3 per cent higher unemployment will give roughly 1.3*10/3 = 4.3 per cent higher housing prices. 29  With even higher inflation and an inflation rate above the target, which according to Qvigstad’s (2005) criteria is justified when unemployment is higher than the long-run sustainable level, unemployment could have been even lower, and housing prices marginally higher. BIS central bankers’ speeches  13  This openness naturally has consequences, and not all of them positive.
The bank can count on being able to invest any surplus remaining at the end of the period in the market at a rate close to the policy rate. It is possible that the formulation of minimum reserve requirements can affect the need to stabilise the overnight rate in periods of financial turmoil. As it does not normally entail any additional cost, there may be an incentive for the banks to increase their deposits with the  BIS Review 51/2008  5  central bank at the beginning of the minimum reserve period when there is great uncertainty in the interbank market. This can entail a reduction in supply and thus rising interest rates in the interbank market. Recent developments Since last summer, developments in the financial markets have been turbulent. The problems were triggered in the US subprime market, which caters to borrowers with low credit ratings. The problems actually began back in 2005 when rising interest rates affected many borrowers. When loans were renewed at new, higher interest rates the loan costs for these borrowers rose substantially. And when property prices fell, there was no scope to mortgage the house so householders could borrow their way out of their problems. Many borrowers could no longer make the interest and mortgage payments on their loans. This caused major loan losses for many mortgage institutions and a general unease among investors. The loans had moreover been repackaged into what are known as structured products and sold on to investors around the world.

Stefan Ingves: Policy rate setting and the monetary policy steering system Speech by Mr Stefan Ingves, Governor of the Sveriges Riksbank, at Handelsbanken, Stockholm, 28 April 2008. *  *  *  During the autumn and spring the international financial markets have been marked by considerable uncertainty and turmoil. The situation has caused several central banks to take extraordinary measures, while for instance the Riksbank has not seen any reason to do so. One reason why central banks have acted differently is that the financial crisis has affected different countries to differing degrees. In Sweden we have not observed any major problems as a result of the financial crisis. This is linked to the fact that Swedish banks have not been exposed to the US subprime market to any great extent. Nor has there been any distrust of Swedish banks, which have a good capacity to deal with unexpected negative events. Ultimately, it is a question of a broad view that Swedish banks do not have problems. Another reason why central banks have acted differently is the differences in monetary policy steering systems between countries. It is therefore important to create an understanding of how the Swedish monetary policy steering system works. In my speech today I will talk about monetary policy from the production of the background material for making a decision until the decision has been implemented. I will focus on how an interest rate decision is put into practice.