samchain/econo-pairs-v1 huggingface dataset:
25  My colleague Anna Breman discussed yield curve control in her speech last spring. See Breman (2021). 26 See The Swedish Parliament (2022) and SOU 2022:10. 9 [19]  also applies here pending further research results. And here I think there will be a lot to learn in the future. In recent years, we have made a considerable analysis of the effects of asset purchases.27 Looking ahead, I am convinced that research can help the central banks with new results, which can more accurately estimate the effects of both QE and QT on the economy. I shall be very interested to see the results. After all, monetary policy needs to develop in pace with the times. A historical parallel to the phase we are in now is when the inflation target regime was established in 1993. The first pioneers had rather limited experience of practical inflation-targeting policy to rely on, and a limited knowledge of which indicators could guide monetary policy.28  The communication challenge One very important issue that we must develop before the next economic downturn is communication regarding asset purchases. I discussed this in my speech a year ago.29 How can we clearly link asset purchases to the capacity to attain the inflation target? Here there is a lesson to be learned for many central banks, including the Riksbank. I believe that the repo-rate path will remain by far the most important tool when we communicate with the public about future monetary policy.

In my speech a year ago, I said that one of the great lessons of the global financial crisis in 2008 and, not least, the coronavirus crisis in 2020, was that the repo rate, our policy rate, is not sufficient as a monetary policy tool to stabilise inflation at around 2 per cent.2 The global financial crisis in 2008 and the years thereafter showed that the socalled lower bound for the policy rate was not only an interesting fact, but also 1 I would like to thank Björn Lagerwall for his help with writing this speech, Johan Almenberg, Meredith Beechey  Österholm, Emma Bylund, Charlotta Edler, Dag Edvardsson, Jesper Hansson, Stefan Ingves, Marianne Nessén, Emelie Nilsson, Åsa Olli Segendorf, Ulf Stejmar, Marianne Sterner, Anders Vredin and Magnus Åhl for their help and valuable comments, and Elizabeth Nilsson for translation of the speech into English. 2 See Skingsley (2021). 1 [19]  real constraint on monetary policy. A further lesson from the crisis was that the turbulence on the financial markets could entail the monetary policy steering rate quite simply not having an impact on the interest rates charged to companies and households. Asset purchases can address both of these issues. They can contribute to further stimulus when it is not possible to cut the policy rate. And they can reduce the difference between the policy rate and the interest rate charged to households and companies when there is financial turbulence.
With a promising recovery prospect, minding the future risks to financial stability and being equipped with stability tools tested and refined over time, the monetary policy committee will carefully weigh the tradeoff between short-term gains and longer-term risks and ensure that the economy will be provided with enough financial ease to recover sustainably to its potential. Ladies and Gentlemen, Apart from the deviation from potential I mentioned earlier, the current economy shows symptoms that potential growth, which depends on labor, productivity and infrastructure development, may have reached its limit. At this stage of our discussion, let me refer to some prominent symptoms. Thai labor supply has started to gradually decrease due to the trend of aging society. Research has shown that increasing labor supply by increasing retirement age and reliance on foreign labor will not be sufficient. Since we must accept the aging workforce trend, we must rely on increasing productivity and efficiency through structural changes to lift growth potential, a task which requires supply-side policies. Thailand’s productivity growth has declined since the Asian Financial Crisis due to the misallocation of labor, government policy, and low capital investment, leading to supply constraints. Productivity can be increased by matching labor to valuable production. Labor in Thailand still has potential to move from the current concentration in agriculture, which was distorted by government policy, to more productive sectors like electrical appliance and capital machinery.

The Bank also has a role in developing the financial system to promote growth. I would like you to follow me now through the details of our role on growth and hope to leave you with more confidence that Thailand is in good policy-makers’ hands. My talk today will cover three areas. Firstly, I would like to share Bank of Thailand’s views on Thailand’s current growth potential. Secondly, I would like to walk you through the current economic conditions and illuminate the role of central bank in returning balance in these situations. And thirdly, I will address the classical yet very current challenge of lifting growth through boosting productivity. I will share with you the opportunities we see for Thailand, involving the structural changes that are now underway, and the cooperation by the central bank, public and private sectors that will transform these opportunities into sustainable long-term growth. Ladies and Gentlemen, Having outlined our plan for today, I would like to begin with the concept of growth potential and its application to the state of Thailand’s economy. What do we expect to see from a Thai economy achieving true growth potential? Two components. First is growth at full sustainable capacity. We would expect to see factories producing their optimum output while hotels have the maximum number of guests that can be served comfortably, and infrastructure from roads to banking system able to lend full support. Second is lifting the long-run growth trend.
At least in hindsight there are usually fairly clear tell-tale signs of expanding fiscal deficits and/or lax monetary policies, classically accompanied by evidence of imbalance in the form of accelerating inflation or a rapidly deteriorating balance of payments. There were such signs, perhaps most notably in Thailand; but they were not for the most part particularly pronounced in Asia. In fact through the first half of the 1990s, and in some cases for much longer, the countries in question were remarkably successful. They attracted, by their very success, huge inflows of capital from the rest of the world in search of higher returns. The capital inflow made a major contribution to sustaining the economic expansion in Asia, but, with the benefit of hindsight, the increasing scale of the inflow, and particularly the form that it took, became an important part of the problem. It was not all effectively employed. There was overinvestment in some production sectors; much went into ambitious property development; and much went into financial rather than real assets. The hoped-for higher returns could not be maintained. Again with the benefit of hindsight, it is possible to identify a number of structural weaknesses in the mechanisms for financial resource allocation in the recipient countries. There was, for example, a general lack of reliable financial information, and a lack of transparency in relation to the financial position, of both public and private sectors.

There is a regulation of the Capital Markets Board of Turkey dated 1 April 2010 that permits the issuance of rent certificate, which are very similar to asset-backed securities. We believe that such interest-free securities, which could also be traded in secondary markets, is very beneficial for the participation banks in their liquidity management operations. Distinguished Participants, The vital issue of liquidity management has the potential to reshape the future trends in the monetary policy framework. The path to resolution involves not only revisiting economic policies, but also economic and institutional infrastructure that surrounds them. In this sense, the Islamic finance has a good way to go in order to maintain well-structured liquidity management system. I hope that this conference will lead to new ideas that help authorities in their efforts to design a solid Islamic liquidity management structure. Thank you for your attention. 2  BIS central bankers’ speeches
In the Asian pragmatic and patient way, and using the wise words of the late Deng Xiaoping, we cross the river by groping for the stones. I am confident that in the end, we will be able to build a robust and efficient Asian monetary network that would contribute to monetary and financial stability, and economic prosperity in Asia, and in turn contribute to global financial stability and prosperity. 61. I cannot end this lecture without paying tribute to the tremendous support and co-operation that the Hong Kong Monetary Authority has received since its formation only four and a half years ago. I want specifically to acknowledge the unstinting support of the People’s Bank of BIS Review 91/1997  - 13 -  China and the Bank of England. Without their guidance the Hong Kong Monetary Authority would not have become a reality. The Bank of Japan, the Bundesbank and the Federal Reserve Bank of New York have also been generous in their support when we went around the international financial centres to explain the unique concept and practice of “one country, two systems”. All our fellow central banks and monetary authorities in EMEAP, SEANZA, and BIS showed us great kindness and support during the sensitive transitional period to the resumption of sovereignty by China in 1997. Indeed, the Hong Kong Monetary Authority is itself the fruit of monetary co-operation. 62. When asked what comes after 1997, we used to give the very simple reply: what comes after 1997 must be 1998.

But the down side risk which all of us should be aware of is the possibility that the global financial market may then become segmented into regional blocs which may result in more competition and friction, rather than co-operation. 11. On the form of monetary co-operation, there is a wide spectrum of experience on the basis of current practice. There is on the one extreme the simple exchange of information and expertise amongst monetary authorities helpful to the management of the domestic monetary system generally, covering the whole range of central banking functions in the management of the currency, the supervision of financial institutions, the development of the financial infrastructure, the management of foreign reserves, etc. On the other extreme, there is monetary co-operation to the extent of achieving monetary union or integration. 12. In between the two extremes there are arrangements for policy co-ordination at the macro level initiated on the realization of increasing international, particularly regional, economic interdependence. There are also the more focused schemes for mutual assistance in the provision of liquidity to facilitate effective monetary management, which may or may not involve the assumption of credit risks between governments. There have also been considerable efforts spent in supervisory co-operation towards the standardization of supervisory practices in order to promote international financial stability, again in recognition of the possibility of the damaging contagion effect of financial crises across financial systems.
If that view were to prevail the main effect would be to inhibit the development of the euro as an international trading and portfolio currency, reducing one of the single currency’s major benefits to both investors and borrowers within the euro area itself. In practice in today’s world of globally integrated markets and liberalised capital flows there is very little prospect of being able to impose artificial constraints on the international use of the euro. There will inevitably be active euro markets in all the major financial centres, including London. And it is in the interest of financial activity right across Europe that there should be. Like trade in goods, trade in financial services is a positive sum game, so that London’s success is not a threat to other European financial centres. As a major interface between Europe and the rest of the world I have little doubt that euro-activity in London will mean more rather than less euro activity in other European financial centres like Frankfurt, Paris, Milan, Amsterdam or Brussels. And conversely I have little doubt either that what is good for those centres will be good too for the City. I hope, Mr. Chairman, that I have said enough to persuade at least some of you that British hesitations about participating in the euro from the outset are not just plain obstinacy!

Out of the first wave we may be - indeed we are - but we remain very much an active and, I would hope, a constructive partner in the process of European monetary integration in a wider sense, and we clearly want the euro to succeed. That is why I prefer to think of Britain in Europe which I took as the title for my talk. BIS Review 88/1998  -6-  Let me conclude, Mr. Chairman, with just a few remarks on the prospects for the euro in the current climate of global financial turmoil. For much of the past two years or so financial markets have shown a degree of scepticism about the future character of the euro. The sense, from about the autumn of 1996, appeared to be that the process was being driven by the politics of Europe with less emphasis on the importance of economic convergence; expectations therefore increasingly focused upon the prospect of a broadly-based rather than a narrower euro; and the inference was drawn that this would mean a weaker rather than a strong euro. Together with comparatively subdued economic activity on the Continent, this perception - or misperception - meant that the core European currencies were for a time relatively weak against the dollar, and against sterling. That situation has more recently begun to change.
These developments  7  4  Not only is liquidity both challenging to define and measure, but the impact of technological change on liquidity is difficult to isolate. On a number of dimensions, technological change appears to have improved both the efficiency of price formation and the ability to transact in size without significantly affecting market prices. But recent “flash” events in various markets – including rapid round-trips in prices on March 18, 2015, in the eurodollar currency pair and on October 15, 2014, in the U.S. Treasury cash and futures markets – have suggested the possibility that advancements in automated trading and changes in market structure may have improved liquidity in normal times but left markets prone to more frequent bouts of illiquidity during which price formation appears disconnected from fundamental information. Structural developments and the connection to liquidity and price discovery across markets warrant further study. See also recent comments by Lael Brainard, member of the Federal Reserve Board of Governors. Recent Changes in the Resilience of Market Liquidity. http://www.federalreserve.gov/newsevents/speech/brainard20150701a.htm. BIS central bankers’ speeches  have resulted in damage to the integrity of the global FX market – damage that will not easily be undone. The behaviors that triggered these criminal and regulatory actions illustrate that, for many, self-interest and the lure of near-term gains were put above the preservation of the market’s integrity and long-term sustainability.

Recent developments indicate that market participants have either not been aware of existing best practices guidance or have made the conscious decision to violate such guidance in the hopes of making a short-term gain. The cost of these short-term gains has come at all of our expense and we must all be engaged to ensure that this does not happen again. Moving toward more globally harmonized guidance – and consistent adherence to such guidance – is an important step forward in maintaining the integrity of the market. In recognition of the importance of this work, a new working group of the BIS Markets Committee has been formed to facilitate the establishment of a single global code of conduct and principles and to promote greater adherence to such guidance. 14 This newly formed  13  See http://www.ny.frb.org/fxc/2015/Global%20Preamble%20March30.pdf. 14  See: http://www.bis.org/press/p150511.htm. BIS central bankers’ speeches  7  structure will deepen and broaden the already initiated public-private partnership and will engage an even wider set of financial centers in order to effectively move this work on best practices forward. The work will occur on a global scale and will engage a wide variety of market infrastructures and participants, including both the buy side and sell side. It will likely draw upon a variety of efforts, including the important work done in the U.K. under the Fair and Effective Markets Review. The FXC will be actively engaged in this effort along with its counterparts abroad, at the direction of the BIS Markets Committee FX Working Group.
10  BIS Review 145/2009  Table 2 Economic growth, current account and inflation (annual change, percentage) 2007  2008  2009 (f)  2010 (f)  GDP  4.7  3.2  -2.0 to -1,5  4.5 to 5.5  Domestic demand Domestic demand (w/o change in inventories) Gross fixed capital formation Total consumption Goods and services exports Goods and services imports  7.8 8.2 12.0 7.1 7.6 14.9  7.4 7.9 19.5 4.2 3.1 12.9  -6.2 -3.5 -12.9 0.0 -4.7 -13.8  6.7 3.7 7.4 2.5 4.9 9.0  Current account (% of GDP)  4.4  -2.0  1.9  1.2  CPI inflation December CPI inflation CPIX inflation December CPIX inflation CPIX1 inflation December CPIX1 inflation  4.4 7.8 4.0 6.3 4.1 6.3  8.7 7.1 8.4 8.6 7.8 7.7  1.7 -0.8 2.8 -1.2 2.8 -0.6  1.5 2.8 1.0 2.6 1.2 2.6  (f) Forecast. Source: Central Bank of Chile. BIS Review 145/2009  11

And I am fairly certain that this is to a great extent due to the fact that we have purposefully worked to attain greater openness and clarity. This provides prerequisites for evaluation, accountability and thus creates legitimacy. All of these factors have contributed to winning confidence in our monetary policy. But the process does not stop here. It is not possible to "rest on one’s laurels” when one works with monetary policy. No, we must keep on adapting to new requirements; we must develop and refine our methods. One expression of this is that we have recently made several changes to become clearer and more efficient in our communication. The fact that we always have these ambitions is something that the general public and our principal, the Riksdag, as well as agents in the financial markets can demand of us. Thank you! BIS Review 62/2007  7
In addition, we have been active internationally – both bilaterally and multilaterally to ensure we have a coordinated, well-informed and mutually supportive approach. This includes our work as a member of the Financial Stability Board. So, while there are challenges, we are very much alive to them. We monitor the risks closely and work continuously with our partners to prepare, and stand ready to take any appropriate action. Opportunities for Hong Kong Having acknowledged the immediate challenges, I think it’s time now to turn towards the opportunities, above all in this region. For while the challenges from the West are deep, they should not blind us to the opportunities within Asia. I would say that the coming opportunities for the banking industry here are bright – even if at times they may appear to be obscured by clouds abroad. In fact, I believe that they put us on the threshold of a new era for the banking industry in Hong Kong. I would like to highlight two of the most promising opportunities. The first is the offshore RMB market, which has developed rapidly over the past two years. The second is the increasing demand for asset and wealth management services, both institutional and individual. Opportunity 1: offshore RMB market On the offshore RMB market, Hong Kong bankers have been the first ones to exploit the new business opportunities.

From time to time, we meet with stakeholders across the value-chain to gather practitioners’ views as to what the market needs in order to develop further. We will continue our work in this regard. Private banking One area we know we can improve is private banking. This is a business area that is growing exponentially in the region. According to industry research, Asia-Pacific has accounted for half the growth in global wealth from 2010 onwards. It also has a fifth of the world’s millionaires. And these numbers will get bigger, with global wealth expected to rise 50% by 2016. So, the opportunities for our region are enormous. We must ensure we have a regulatory framework that recognises this, one that is user friendly to private banking clients, yet sufficiently robust to provide appropriate investor protection, as well as being on par with international standards. To achieve this, we’ve recently introduced some refinements to our regulatory arrangements, following consultation with the industry. These measures were announced in June, so I’d just like to very briefly recapitulate four of the key points as follows. First, while we want to ensure appropriate protection to all investors, it is reasonable to treat private banking and retail banking clients differently in the investment process. So the first change is that we have provided an expanded definition for “private banking customers” that caters much better for the operational needs of private banks.