samchain/econo-pairs-v1 huggingface dataset:
In concordance with the modern philosophy of macroeconomic administration, the Bank of Albania remains committed to not allowing that rapid and short-term economic growth impair the long-term development perspectives of our country. At microeconomic level, the growth of consumption in economy was followed by increased indebtedness in Albanian households’ and businesses’ balance sheets and by overinvestments in certain sectors of the economy. Both these indicators are either at lower levels than in the regional countries, or at similar levels; hence, they cannot be specified as problematic. However, their rapid growth rate creates the idea of a short-term vision of the economic agents, and in particular cases, even avoidance of rationality. Dwelling upon household consumption, the Bank of Albania invites all economic agents to be more forward-looking and realistic in their consumption and savings plans. This invitation does not imply the contraction of consumption or the change of preferences related to it, but merely placing it in the context of long-term plans that equal income and expenditure at a household level. Beyond the time-related dimension, as we have continuously drawn the attention, borrowers should be cautious as regards their loan currency. This implies that the matching of their loan currency with that of their income would be their best protection. In a more pragmatic  BIS Review 158/2009  3  approach, this advice may be reduced into an appeal for a close consultation with the banking system and the financial market’s specialized agents.

Structural vulnerabilities and the need for reform A useful lesson that the Bank of Albania has learnt from the crisis is the need to continue and deepen the structural reforms in the economy. These reforms, not only will create a more appropriate environment for promoting the private entrepreneurship, but will also increase the economy’s resilience to shocks. They also help to absorb foreign direct investments, which are the best support to the country’s development in the medium and long run. However, as stipulated even in the EBRD’s report, Albania is among the few countries that have continued structural reforms even during 2009. In this regard, Albania has lagged behind the regional countries, attracting in total only about USD 1100 per capita of FDI during the 20 years of transitions. In the entire broad framework of reform-related problems, I would like to dwell today upon the need for investments in education and infrastructure. A well-known business maxim is that: Employees are a company’s most precious asset. To the Bank of Albania it signifies that the higher the professionalism, the higher our institutional independence. To a broader sense, this is also relevant for the national economy. Our country’s progress, the convergence with the developed countries of East Europe and even beyond, with the European Union countries, will depend on our level of education. Competition in national and international markets is above all based on the generation of ideas and their use in the final products.
The couple in Wanchai should not have forgotten what drew customers to their noodles in the first place. They had failed not because their customers had decided to eat sandwiches rather than noodles but because they forgot that it was quality that made the noodle shop  2  BIS central bankers’ speeches  successful in the first place. Very often we become complacent and take things for granted after we have been successful, just like the Wanchai couple did. Shifting to a new product line in which we have no real expertise or niche was a recipe for disaster. The same holds true if we look at what made Hong Kong tick twenty or thirty years ago. Many good qualities such as can-do spirit, never-say-die, openness and versatility that were cherished by Hong Kong people in the past seem to have faded away. Keeping these good qualities, Hong Kong can hope to maintain its competitive edge even when the goings get rough. 10. Ladies and gentlemen, the message I have for you is: while an entrepreneur should always strive to expand and grow his business, it is equally important that he should resist complacency and continue to excel in what he is doing or what he is good at. To venture into an unfamiliar universe in which one has no expertise or advantage is risky. The market is fiercely competitive and no doubt customers’ preference may change, but the market is generally fair and always rewards quality and consistency handsomely.

I have no doubt that the quality of the discussions we have today will allow us to deepen our understanding of these challenges and, hopefully, allow us to draw some useful conclusion in terms of economic policy. I leave the floor now to Mr. Isidro González, Deputy Secretary General of the Union for the Mediterranean, thanking him as well as you all for your presence here today, and thanking Mr. Senén Florensa, President of the Executive Committee of IEMed, for the cooperation in the organisation of this event. Now, Isidro, the floor is yours. 3/3
Paul Fisher: The outlook for the UK economy Speech by Mr Paul Fisher, Executive Director for Markets of the Bank of England, to the Cardiff Breakfast Club, Cardiff, 24 May 2013. *  *  *  Introduction It’s nice to be back in Cardiff again. As always, I will be taking the time while here to visit a number of local businesses in an effort to find out what is happening “on the ground” in the Welsh economy. Our network of agents across the UK provide the MPC with valuable intelligence on a continuous basis, but there’s nothing quite like hearing it at first hand for oneself. Recent changes at the Bank of England I’d like to start this morning by outlining some of the recent institutional changes at the Bank of England, which will help shape the policy environment for a generation. First of all, supervision is back! The new Prudential Regulation Authority, a subsidiary and therefore part of the Bank of England, has moved into its new offices at 20 Moorgate, just a two minute walk from the back of Threadneedle Street (or faster on a cold morning!) The move back to the Bank will help us to exploit the synergies between microprudential supervision on the one hand and the markets, economics and financial stability expertise of the wider Bank on the other. But most importantly this is an opportunity to change the way in which banks (and building societies, credit unions, insurers and major investment companies) are supervised.

So pursuing a strategy of monetary accommodation will be in the interests of savers in the medium-term, even if it feels like the opposite in the short-run. We should all want to see sufficient growth such that interest rates can start to rise. 4  BIS central bankers’ speeches  Taking all that together, my policy vote has been driven by the need to continue supporting the required real adjustments – which still have much to work through – but cautiously, so as not to risk inflation expectations becoming de-anchored. My personal view is that faster growth in the near-term might actually help keep inflation down for a while as productivity growth picks up. Eventually, however, reductions in the degree of spare capacity in the economy should bring domestic inflationary pressures back to normal, so it will be important that other factors influencing inflation do not remain elevated. The MPC is committed to getting inflation back to around the 2% target – which it will in due course, in the absence of further shocks and if we are careful with policy. Monetary accommodation should generally be helpful to balance sheet rebuilding, but there are limits. For example, I am not convinced that a further reduction in interest rates would stimulate demand at this stage. Cuts in interest rates work in part by encouraging spending (or investment) at the expense of saving.
Cyber-threats are a vital concern for the supervisors responsible for the safety and soundness of the financial system and for individual risk managers. In the U.S., the Department of Treasury, our intelligence agencies, financial regulators and supervisors, and risk professionals across the financial sector are working to defend against cyber-attacks and to minimize the potential disruption resulting from a successful attack. U.S. authorities are working to finalize objectives-based supervisory expectations for risk management around cyber threats. I’m encouraged that this year’s Forum includes an expert panel on “Technology Risks” that will explore the cyber-threat landscape and approaches to mitigate the associated risks. A second noteworthy omission relates to a specific component of governance. While some governance topics have been remarkably stable, in my view, risks associated with business misconduct at financial institutions have not received adequate attention in these Forums. Through initiatives like the annual conference on “Reforming Culture in the Financial Services Industry,” the New York Fed has been challenging the financial industry to consider the many factors that have contributed to recent, widespread instances of misconduct. In concert with the industry, I believe that supervisors can help the industry improve governance, culture and behavioral outcomes through supporting the development of effective internal governance regimes, prudent risk management policies, incentives, and strong compliance and control structures, all within a framework of effective oversight from the board of directors. In today’s Forum and in the future, I welcome other participants’ thoughts on approaches for developing, measuring, and maintaining a strong, ethical culture within the industry.

A number of banks see the logic in this and support our proposals. Others remain less enthusiastic. But we are consulting the industry further on this and I hope that something that is acceptable to all can be arrived at. 11. Next is the issue of the review of the Code of Banking Practice, in relation to which it is suggested in David’s letter that some people are unhappy about the stance taken by the HKMA. On this, I am afraid, I have rather less sympathy than on other issues with those who raise concerns. I do not believe that any of the changes promoted in the Working Group, such as in relation to credit cards and also to fees and charges, are unreasonable. Indeed, most banks seem to have accepted the rationale for changes such as the $ card loss limit, which brings Hong Kong into line with international practice. I believe that the banks must appreciate that issues relating to terms and conditions and other aspects of customer service are a legitimate matter of public interest and concern. In the past, it is true, the HKMA has not been as closely involved in consumer matters. This, however, is something that is changing, not because we particularly desire it but because it seems to be what the public expect. We plan, therefore, to review our involvement in this area so as to determine exactly what our role should be. 2  BIS Review 3/2001  12.
In an acute crisis situation, the availability of sufficient liquidity, together with a strong equity position, is absolutely crucial. Fourth and finally, I would like to mention that, in the Swiss franc money market, repo business via the Swiss Value Chain has proved to be a crisis-resistant source of liquidity, thanks to the consistent minimisation of risks. The repo market allows participants to undertake rapid refinancing in the interbank market, independent of credit limits, thereby making a major contribution to the stability of the financial system. That is why it is important for the SNB that all Swiss and foreign banks operating in the Swiss franc money market join the Swiss repo system. BIS Review 150/2007  3  4  BIS Review 150/2007  BIS Review 150/2007  5

Underlying price pressures in the euro area are expected to remain subdued, reflecting the broad-based weakness in aggregate demand and the modest pace of the recovery, as well as subdued monetary and credit dynamics. Medium to long-term inflation expectations continue to be firmly anchored in line with price stability. The risks to the outlook for price developments are expected to be still broadly balanced over the medium term, with upside risks relating in particular to higher commodity prices as well as stronger than expected increases in administered prices and indirect taxes, and downside risks stemming from weaker than expected economic activity. The ECB’s monetary policy stance continues to be geared towards maintaining the degree of monetary accommodation warranted by the outlook for price stability. It thereby provides support to a gradual recovery in economic activity. Looking ahead, our monetary policy stance will remain accommodative for as long as necessary. In line with the guidance provided in July, the Governing Council expects the key ECB interest rates to remain at present or lower levels for an extended period of time. This expectation is based on an overall subdued outlook for inflation extending into the medium term, given the broad-based weakness in the economy and subdued monetary dynamics. In the period ahead, the ECB will monitor all incoming information on economic and monetary developments and assess any impact on the medium-term outlook for price stability.
People in the informal sector and SMEs who hitherto were unable to open savings accounts with banks due to high minimum deposits and service charges should find the “Tusunge” Savings Product attractive. Ladies and Gentlemen, in the face of an ever growing fear of donor fatigue, public deposits and private capital are likely to be the main source of funding for the microfinance industry to achieve the growth required for it to have significant impact on financial inclusion and poverty reduction across the region. Notwithstanding this, allow me now to reflect on some of the key challenges in the financial sector that all of us must strive to address: (i)  Increasing access to financial services by the SME’s who form the backbone of the economy. This sector provides employment for many people who cannot be absorbed into formal employment. However, increased access to financial services remains a key challenge to this segment. (ii)  Although the Bank of Zambia has licensed 25 Microfinance Institutions, most of them operate along the line of rail providing mainly salary-backed loans. There is need for microfinance institutions to support production by providing finance to agriculture and manufacturing instead of merely providing consumption related salary backed loans. (iii)  There is need for all microfinance institutions to utilise the credit reference bureau at all times. A robust credit reporting apparatus will enable the financial sector to share critical customer information that will lead to lowering the credit risk and ultimately lending rates in the financial sector.

Oil prices are of importance for the activity level in the Norwegian economy and the government revenues. In recent years, oil prices have risen sharply. High demand for oil, limited idle production capacity and uncertain production levels in many oil-producing countries have contributed to this. Oil prices have risen to over USD 74 per barrel, partly as a result of the uncertain political situation in a number of producer countries. Futures prices for Brent Blend are now more than USD 72 per barrel until autumn 2008. Futures prices indicate that oil prices will remain at around USD 70 per barrel several years ahead. This is higher than the level assumed in the March 2006 Inflation Report. Statoil and Hydro gas prices have also increased sharply in recent months. Petroleum production is expected to increase gradually in the period to 2011, and decline thereafter. Developments in the gas market will become increasingly important. During the next 10 years, gas production could become as high as oil production, measured by energy content. High oil prices have led to a strong increase in activity on the Norwegian continental shelf. Many projects have been launched to increase recovery from fields in operation. A number of companies have revised up the long-term oil prices that are used as a basis for investment decisions, but they are still moderate compared with futures prices. Further out in the projection period, developments in petroleum-related investment become highly uncertain.
Besides its use as a means of payment that promotes confidence, central bank money also requires a reliable settlement of payments. A settlement mechanism is required that replicates 1 2  3  In addition to commercial banks, other parties – such as the Confederation and various financial institutions – have access to central bank book money. For the sake of simplicity, these are disregarded here. The SNB provides counterparties with interest-free liquidity during the day (via the intraday facility) to facilitate the settlement of payment transactions. In order to bridge unexpected liquidity bottlenecks, the SNB offers a liquidity-shortage financing facility, whereby at least 110% of the liquidity drawn must be backed by collateral eligible for SNB repos. It is crucial that payments important for the system as a whole be settled through an account with the central bank. Payments settled in a commercial bank account entail credit risk. Only payment settlement in an account with the central bank – that is, in central bank money – is not subject to credit risk, since the central bank is the only institution that cannot go bankrupt. Page 3/11  the delivery of cash in digital form for commercial banks, i.e. a real-time transfer that is final and irrevocable. One such payment system was introduced around the world in the 1980s – the real-time gross settlement (RTGS) system. Switzerland was a pioneer in its development of the Swiss Interbank Clearing (SIC) system in 1987.

If confirmed, this should serve to improve confidence and preclude the more negative economic scenarios, although it will take time for the attendant effects on activity to become apparent. 2  As regards the euro area inflation outlook, the ECB forecasts a very modest rise this year of 0.3%, with a recovery to 1% in 2021 and 1.3% in 2022. However, these values are well short of the medium-term price stability target, defined as inflation rates below, but close to, 2% over the medium term. The latest flash estimate for the euro area Harmonised Index of Consumer Prices, referring to October, shows annual inflation of -0.3%, weighed down by the recent appreciation of the euro, low energy and services prices, and the temporary impact of the VAT cut in Germany. Core inflation held at an all-time low of 0.2% in October, unchanged on September. It is worth noting that 35% of the headline inflation components recorded negative growth rates, and around 70% of the components grew at rates of less than 1%. Consumer expectations have held on a downward path since March, while the metric derived from financial markets (five-year swaps) declined slightly to 1.16%. Meanwhile, the long-term expectations of the Survey of Professional Forecasters held stable at around 1.7%. The situation I have just described is, therefore, one of a fragile and uncertain recovery in the euro area, in which some of the downside risks for our baseline scenario, which were identified just a few months ago, are materialising.
The global banks play a major role as providers of liquidity in home, host and international markets. Even in emerging markets, debt and equity market liquidity often relies on active participation by global banks. Enhanced regulatory requirements should therefore be targeted, risk appropriate, and applied in a non-discriminatory way on banks posing the same level of risk, be they domestic or global banks. The safety buffers for global banks, which clearly needs to be enhanced, cannot therefore rest too heavily on premiums in up-front capital, liquidity and other regulatory requirements. We should strengthen supervision and crisis resolution capabilities to complement and avoid an over-reliance on regulation. Strengthen continuous supervision rather than rely excessively on upfront regulatory requirements. Effective international coordination among supervisors requires more open and transparent sharing of information between home and host supervisors – home supervisors will want to be well informed about the requirements imposed on significant overseas subsidiaries, and host supervisors need to be kept apprised of developments at the parent bank. Cross-border supervisory colleges and crisis management groups are therefore critical, and they have to be strengthened to ensure that  2  BIS central bankers’ speeches  national policy measures are globally consistent and mutually supportive. So that is the first risk, of going too far with respect to global banks such that the global financial system is impaired. The second risk is that of the fragmenting or balkanising finance. We are already seeing signs of this, and most especially in the wake of the European crisis.

But there are other factors contributing to the recovery: the fall in oil prices, which is translating into a boost to household incomes and into a reduction in firms’ production costs; the very significant depreciation of the euro; and the favourable economic activity figures of some of our trading partners within the Monetary Union. Turning to prices, the annual rate of inflation has been negative in the first three months of 2015, running at –1.3%, –1.1% and –0.7%, respectively, although the non-energy CPI and the core inflation index have been more stable, posting positive figures. In particular, in March, on preliminary figures, the annual rate – though still negative – is estimated to have stood at –0.7%, an increase of 0.4 pp on February, which largely stemmed from the correction in oil prices. Following several quarters of sluggish growth, a recovery is discernible in the euro area. Most member countries are posting positive GDP growth rates, although there are significant differences. Among the major economies, the pace of economic activity is highest in Spain and Germany. In 2014, euro area GDP grew by 0.9%, compared with a decline of 0.4% in 2013. Driving this recovery has been the increase in private consumption, in a setting of improved household confidence and income. Other favourable factors have been the contribution of exports and gross fixed capital formation, the latter due to the pick-up in construction.