samchain/econo-pairs-v1 huggingface dataset:
Persistent below-target inflation is very costly, especially when it is accompanied by debt overhang, substantial resource slack, and weak growth. In the United States, the challenge of below-target inflation continues to be underappreciated in public commentary. Mistakenly, many greatly exaggerate the risks of overly high inflation. Before turning to inflation risks, let me mention one reason for some confusion. That is, some commentaries minimize the current below-target inflation experience by citing the slightly higher increases of the Consumer Price Index, or CPI. The CPI is the best-known single measure of inflation, and its underlying trend currently is running at a bit above 1–1/2 percent. Many commentators compare the CPI against our 2 percent inflation objective. Unfortunately, this is an apples and oranges comparison: The CPI tends to run about a quarter to a half of a percentage point higher on average than the PCE index because of its different market-basket composition and statistical construction. Accordingly, it is much more accurate to describe the Fed’s inflation objective in terms of the CPI to be roughly 2–1/2 percent. So, against this 2–1/2 percent benchmark, CPI inflation also is quite low relative to target. In any event, the PCE price index is the preferred inflation measure on a number of theoretical grounds and the one chosen by the FOMC as its policy target; therefore, we should judge the Committee’s ultimate inflation performance using that index relative to its 2 percent goal. So, what is the inflation outlook in the current environment?

Also, several thousand experts, including auditors, consultants, appraisers, etc., participated in the exercise and strict quality assurance was enforced both at the level of the national supervisory authorities and by the ECB. The results disclosed yesterday show that European banks have, in the main, a comfortable solvency cushion. A good number of them have been able in recent months to reinforce their solvency levels notably, meaning that the capital measures needed to comply with the requirements arising from the exercise are modest in scope. However, the analysis has shown that some European banks are in a vulnerable solvency position, which they should redress as soon as possible. All told, as important as the solvency assessment the exercise provides is the detailed information furnished on each bank. In particular, the asset quality review offers significant data on the potential shortcomings of the way in which the financial information disclosed by banks reflects the risk they assume. Here it can be seen, once again, that there is no widespread material understatement of risk, in the form of valuation failings or provisioning shortfalls. But there are European banks where the asset review has evidenced shortcomings of some significance. In the case of Spanish banks, the analysis has offered fairly satisfactory results. In particular, the asset quality review situates Spain as the country where fewest failings have been detected in proportion to the sector’s aggregate assets.
Prior to this, only real estates and certain types of movable property can be used as collateral. With this new Act, a firm can further gain access to funding by putting up inventories, machineries, and intellectual property as collateral. Given this, Thailand’s small and medium enterprises, which constitute 95 percent2 of the total number of firms and make up 30 percent of total employment3, are expected to gain better access to credit, thus representing a better distribution of economic opportunity. Ladies and gentlemen, allow me to reiterate that, although I group this set of laws as ones that promote governance and improvement in economic opportunity, in actuality, they all have positive spillover towards enhancing economic growth and productivity. After all, having a well-functioning capital market, better managed SOEs, a fairer and more competitive environment, and more access to credit will allow 1 Excluding activities to preserve national security 2 Source: The Office of SMEs Promotion, 2014 3 Average over 2015, National Statistical Office of Thailand calculated by the Bank of Thailand  4  greater efficiency among players both in the public and private sectors. I will now turn to the legislation that will help improve productivity. There are three laws in particular that I believe will be of your interest. First is the Licensing Facilitation Act, which is already in effect since July last year. The law intends to make acquiring a permit easier and more transparent for all businesses.

These reform efforts might result in short term setback, but will certainly result in long term gains that promote sustainability and further enhance our competitiveness and business partnership with foreign partners. My talk this evening on Moving Thailand Towards a New Business and Financial Landscape will consist of three parts. First, I will briefly discuss Thailand’s current economic development. Second, I will elaborate on several important sets of recently enacted and upcoming laws that will upgrade Thailand’s business and financial landscape. Lastly, I will briefly discuss Bank of Thailand’s policies to support the new business and financial landscape. With regard to the current economic development, we expect the Thai economy to continue its recovery at the rate of around 3.2% in 2017 in spite of headwinds from the global economy and market volatility. Our fiscal stimulus programs and accommodative monetary policy continue to support the economy while export growth started to show sign of a more broad-based recovery. Nevertheless, there are challenges ahead, especially from a high level of household debt, which moderates consumption growth 1  while private investment remains subdued. In addition, the mourning period might have temporarily dampened some of the economic activities. We expect them to resume normalcy in the near future as the fundamental strengths of the Thai economy remain intact. Notably, our unemployment rate continues to dwell at a low level, while external stability is sound, with current account surplus expected to be around 7 percent of GDP this year, declining from 10% of GDP in 2016.
All of these solutions lead to lower cost of financial services, greater financial access, and greater opportunity for the public. Ultimately, “fintech” can help unlock massive potential of our people and businesses and be a powerful tool for Thailand and developing countries to improve on productivity, immunity, and inclusivity of the financial system as well as for the whole economy. Ladies and gentlemen, The theme of our very first Bangkok FinTech Fair focuses on SMEs and consumers, because these two groups face various challenges and can benefit greatly from the adoption of fintech. For Thailand, SMEs represent the majority of firms and make up over 80 percent of total employment. Many SMEs struggle to gain access to finance and payment services, which, on one hand, can be attributed to poor financial health due to loss of competitiveness. On the other hand, many SMEs lack the financial management skills and collateral needed for funding, and their 5-7  cost of finance remains high. Meanwhile, the Thai public is facing big hurdles of low long-term savings and high household debts, with Thailand having household debt to GDP ratio amongst the highest in the region. Many households lack access to efficient and low-cost financial services, be it the deposit, payment, insurance or loan products. These people need to be better served by our financial system to be able to unlock their potential, improve standard of living, and ensure their financial security as they age.

Before I do so, I would like to take a step back and focus on three key words, which I believe are imperative for formulating financial sector policy for Thailand and the region as a whole. These three key words are productivity, immunity, and inclusivity. First, an emphasis must be placed on productivity as uplifting productivity is a critical requirement for long term growth of an economy. For one, at current stage, many countries in our region are facing structural transformation of aging workforce. Shrinking workforce can dampen long term growth prospect. We must become more productive in order to increase output level and improve standard of living of our people. Productivity is also needed to boost competitiveness of businesses as expanding global trade network and emergence of large e-business platforms have introduced new competitors into our business landscape. Moreover, roles of banks could be challenged as sharing financial platforms gain prominence in the modern economy, and new fintech firms offer financial products unbundled from the long standing value chain of banking. Without meaningful adjustment—that is improving productivity, long term growth potential of an economy could deteriorate. Second, immunity becomes imperative in the current global economic landscape. We are living in the time of changes, where outcomes can be abrupt, unpredictable, and volatile. Amidst the fallout from the Global Financial Crisis of 2008, where unconventional monetary policies flushed global financial market with excess liquidity, we are now entering the cycle where major central banks have started normalizing their monetary policies.
The past two years have shown that the work of central banks and industry in partnership, at a global level, is productive in developing and supporting best practices. As such, while both the FXWG and MPG have fulfilled their mandate to develop the Code, this spirit of central bank-industry partnership will be maintained, as will the Code itself, in the future by the newly formalized GFXC. The GFXC reflects a significant expansion of cross-border and public-private sector efforts. It is a forum that brings together central banks and market participants via the FXCs—currently representing sixteen regions—to encourage collaboration and communication on FX-related issues, to exchange views on trends and developments in the FX market, and to promote and maintain the FX Global Code. In addition, the work to develop the Code has led to the development of central bank-sponsored FXCs in new regions, some of which have already launched and others that are forthcoming. FXCs, including the one sponsored by the New York Fed, will play important roles both within their own region and in their global engagement via the GFXC. One of the key objectives of the GFXC is to keep abreast of the evolution of the market, and work to ensure that the Code’s principles remain relevant. One area of evolution is electronic trading. Before concluding, I want to spend some time discussing the GFXC’s request for feedback on 4/6  BIS central bankers' speeches  particular aspects related to the use of last look in electronic FX trading.

It is a critical market that is relied upon by households, corporations, financial institutions, asset managers, sovereigns and many others. In 2015, I called on the industry to help strengthen the foundation of the market and to uphold its integrity. Today, I am pleased to say that the industry answered that call and there has since been significant industry engagement on work to promote the integrity and effective functioning of the FX market. After more than two years of work, the FX Global Code1 (the Code or Global Code) has been published to serve as a single, global set of principles for the FX market. The Code is accompanied by a set of adherence principles to promote its widespread adoption, and includes a set of illustrative examples to further describe various practices. In addition, a new, formalized Global Foreign Exchange Committee (GFXC) was launched to engage an even broader set of regions than past efforts and to continue a more defined work program across jurisdictions for upholding the Global Code. In my remarks today, I will share reflections on the Global Code, including some lessons learned in its development and the various steps underway to help promote and support its adoption. I will then discuss the Global Foreign Exchange Committee’s (GFXC) objectives, which include the ongoing evolution and maintenance of the Code.
However, we should focus our resources first on activities where we have a natural advantage, or can build up a capability. We must push in the same direction as market forces, and not against them. Our main approach to developing the financial centre should therefore be to establish a level playing field with transparent rules and the right environment, so that market forces can operate and innovation can flourish. Active promotion of specific activities complements this. Conclusion The major changes in the financial industry compel financial centres to adapt and evolve, or else be bypassed and rendered irrelevant. Singapore aspires to be one of the financial centres in Asia, and a node in the global network of financial markets. By implementing the right policies and strategies vigorously, we hope to develop and grow as a financial centre, serving Asia and contributing to its development and prosperity. 4  BIS Review 50/2001

I will return to the monetary policy implications of this growth outlook in a while. The missing instrument problem But before doing so, I want to report on the progress that has been made in strengthening the macroeconomic policy framework in the UK in response to some of the fault lines exposed by the financial crisis. Much analysis and soul searching has been conducted in the aftermath of the crisis, and the lessons and implications for different aspects of economic, financial and other areas of public policy are wide ranging. In terms of the lessons to be learnt for monetary policy, many commentators and policymakers – myself included – told a variant of what could be termed the missing instrument problem. 3 This analysis argues that the case for an inflation targeting framework remains sound: the focus on a clear numerical target for monetary policy has served our  3  4  Dale (2009). BIS Review 161/2010  economy well, and low and stable inflation remains a cornerstone of our long-term prosperity. However, it acknowledges that control of short-term interest rates – the main tool of monetary policy – is a relatively blunt instrument best deployed maintaining a broad balance between nominal demand and supply. In particular, movements in short-term interest rates are not well suited to managing risks from credit cycles and other imbalances within the financial sector.
Banks in the developed countries have been merging and consolidating, globally, in search of greater scale and efficiency. Their customers are demanding faster access to more customised and integrated financial services. Banks can now deliver one-stop service through faster distribution channels, and develop sophisticated customer relationship systems to customise products. Technology has made this possible. But the cost of investments in technology is high, and can only be justified and recovered if it is spread over millions of customers. Banks like Citicorp have spent tens of billions of dollars, developing IT systems to support their consumer banking services. Being a big bank is no guarantee of success, as shown by the persistent difficulties of the Japanese banks over the last decade, which in the 1980s were among the biggest banks in the world. But being a small bank is definitely a significant handicap. The logic of Singapore’s position is inescapable: if we want strong banks, then they have to be big banks, and if they are to be big banks, then we must have  BIS Review 61/2001  1  fewer banks. This is the reality in many small countries. Switzerland, with a GDP and population about twice our size, now has only two big banks – UBS and Credit Suisse – both of which are world-class players. The Netherlands, four times as big as Singapore, has three – ABN-AMRO, Rabobank and ING, plus Fortis which is partially Belgian. These have become major international players.

Given the strong data, this is not what and how a developed market should behave as there is ample FX market liquidity. If we look at the recent daily volume of FX trade, although lower than last year, it was still double the amount 5 years ago, between USD5-6 billion for the USD/MYR pair and between USD8-10 billion for all other currency pairs. What we need to do now is to remind ourselves and each other constantly that we need to put things in proper perspective. As a group, we constitute the market and individuals, we should behave responsibly. BIS central bankers’ speeches  1  On the other hand, despite the adverse market conditions, we noted that the Malaysian bond market has been holding up quite well despite lower level of liquidity, thanks to domestic institutional players’ support. Nevertheless, we also realized that significant foreign participation in our financial market can be both a boon and a bane for the industry. While high foreign participation has led to better liquidity and lower cost as what we have experienced in the past, it has also brought risks and vulnerabilities. The percentage of nonresident holdings itself has evolved into a risk indicator, regularly quoted by market commentators, where 48% is the number frequently quoted as the percentage of nonresident government security holdings. There was also the argument that large holdings by non-residents might leads to sell offs during period uncertainty, thus causing financial market instability. This is erroneous and misleading.
Financial crises are much more likely to be associated with corrections of asset values where asset purchases have been financed with debt rather than equity. Aggregate global debt – public, private and financial – is now around 320% of global GDP, close to its record highs. Excluding financial sector debt, the debt of the real economy is around 240% of global GDP.6  But aggregates can only tell you so much. And they can hide a multitude of sins. We need to need to look not just at the level of the total, but the growth rate and sustainability. And we need to drill down into the composition to see where the risks are most prominent. Growth, level and sustainability  Research suggests that it is the growth rate of debt rather than its actual level that is the leading indicator of financial crises. Bank of England work based on 130 downturns in 26 advanced economies since the 1970s suggests that a rapid build up of debt is the best early warning indicator of a recession.7 Other academic work supports this conclusion.8  The actual level of debt matters rather in determining the depth, as opposed to the probability, of the crisis. So we need to look at the growth rate as well as the level. 6  See IIF Global Debt Monitor. Of the 317% of global debt to GDP, 60pp is household debt, 90pp is to non-financial corporates, 86 is government, and 80pp is financial corporates.

Fellow Members of Staff, Invited Guests, Ladies and Gentlemen, as we move ahead and look to the next 50 years of Central Banking in Zambia, the Bank of Zambia will continue to play catalytic role in facilitating the exchange of ideas among financial sector players and all other key stakeholders. BIS central bankers’ speeches  1  Today, we are here to officially launch the celebrations of 50 years of our existence. I would like take this opportunity to inform you that a number of activities have been lined up to commemorate this wonderful occasion. These include: 1. An international symposium to discuss selected pertinent to the Bank of Zambia and in line with the theme of our celebration, scheduled for 7th August 2014;  2. An exhibition dedicated to the history of the Bank of Zambia;  3. The publication of a book on the History of the Bank of Zambia;  4. The launch of a book on Economic Policies in Zambia;  5. A national school quiz; and  6. A family day to show our gratitude to the families of the members of staff for their support in our execution of the Bank’s mandate. Ladies and Gentlemen, it is our expectation, therefore, that all members of staff will take part in the upcoming activities in order to make the anniversary celebrations a success and memorable.
In this regard, a number of developing economies in the region will need to further invest and upgrade their infrastructure to fully realise their growth potential. Infrastructure development generates employment, improves access to basic services and economic opportunities, promotes trade and investment, reduces the cost of doing business and encourages private sector development. It raises income and helps reduce poverty by spreading the benefits of growth more widely. The rising standard of living will in turn generate domestic demand, providing a new source of growth even as global demand continues to slow. ADB estimates that Asia needs as much as $ trillion in overall infrastructure investment between 2010 and 2020, with an average of $ billion in annual infrastructure spending. While the infrastructure needs are huge, Asia also has vast foreign reserves and private domestic savings. Traditionally, these savings have not been channelled to meet Asia’s own financing needs directly. Most of the savings have been invested in advanced economies before they are recycled back into the region. However, the global financial crisis has changed the landscape. Investors are increasingly looking to diversify their portfolio to this part of the world in the light of the faster growth and stronger fundamentals of the region. So there seems to be no lack of appetite to invest in Asia. The question is how to channel these funds to finance Asia’s infrastructure investment needs. Creating an enabling environment to facilitate private sector investment in infrastructure projects is crucial and fundamental.

Eddie Yue: Investment in infrastructure is crucial to Asia’s growth Statement by Mr Eddie Yue, Deputy Chief Executive of the Hong Kong Monetary Authority and Head of the Delegation of Hong Kong, for the 46th Asian Development Bank Annual Meeting, Delhi, 4 May 2013. *  *  *  I would like to thank the Government of India for hosting the 46th Annual Meeting of the Asian Development Bank (ADB). I wish to take this opportunity to pay tribute to Mr Haruhiko Kuroda for his excellent work in leading ADB for more than eight years. We welcome the appointment of Mr Takehiko Nakao as the new President of ADB, and look forward to continue working closely with the Bank under his leadership in furthering the development of the region. Global economic sentiment has improved since the beginning of this year. The announcement of further accommodative monetary easing by major advanced economies has reduced tail risks and stabilised financial markets. But while the accommodative monetary policy will help authorities buy time to solve the problem, it is by no means a substitute for medium-term fiscal consolidation and structural reforms that are required for the economy to regain competitiveness and return to a sustainable path. Looking ahead, economic adjustments and deleveraging in both the public and private sectors are set to continue in the advanced economies, and regional economies will increasingly have to look to themselves for new sources of growth.