samchain/econo-pairs-v1 huggingface dataset:
It presupposes that the general public has ample opportunity to insight into our activities and that we are regularly  2  BIS Review 22/2008  examined. So assessment is important to us – both from an efficiency perspective and a democratic perspective. However, for the assessment to meet these purposes, there are a couple of factors to be taken into account. What can monetary policy achieve? To begin with, the demands – the actual base for the assessment – should be founded on what monetary policy can actually achieve. Monetary policy is able to secure an inflation rate that is in line with the inflation target over a number of years. It can also contribute to stabilising cyclical fluctuations in production and employment. However, monetary policy cannot achieve a permanently higher level of employment or growth in the economy. Both previous experience and economic theory have shown this to be the case. And this was one of the reasons why it was decided when drawing up the Sveriges Riksbank Act that it would be inappropriate for the Riksbank to have an explicit target regarding, for instance, GDP growth or employment, in addition to the price stability objective. It would then appear natural to assess monetary policy by looking at the way in which the inflation outcome relates to the Riksbank’s inflation target. But there are some factors here too that should be borne in mind. In retrospect One such factor is that efficient inflation targeting by necessity must be based on forecasts of economic development.

The most recent example was ordering the more detailed material for assessing monetary policy which the Riksbank published about a week ago. I shall return to this assessment later. But first I would like to say a few words about current monetary policy. Our most recent assessment Our most recent interest rate decision was not an easy one. There is considerable uncertainty, for instance, on which direction international economic activity will take. And, as you are aware, we also had slightly differing opinions within the Executive Board. However, we must nevertheless make a decision and the majority of us reached the assessment that the repo rate should be raised to 4.25 per cent. We are forecasting that the repo rate will remain around this level over the coming year. This type of interest rate development will contribute to inflation falling back and being around the 2 per cent target a couple of years ahead, at the same time as production and employment develop in a balanced manner. Different forces are pulling in different directions In our decision we weighed together many different factors. A lot has happened; both events that could push up inflation and events that could hold it back. On the one side were conditions implying a higher interest rate. Inflation rose rapidly in 2007 and we are expecting it to remain high over the coming year. Expected inflation has also risen and cost pressures are high. Economic activity in Sweden remains good and the labour market is strong.
By far the most visible innovation since the beginning of the Great Recession however, has been the increase in the array of instruments used for monetary policy purposes, particularly forward guidance about interest rates and most notably the use of central banks’ balance sheets through Large Scale Assets Purchases (LSAP, i.e. Quantitative Easing or QE). In theoretical debates, other proposals were made namely, to change the targets of monetary policy to price level targeting or to nominal GDP or simply, to increase the established objective of 2% in inflation targeting regimes to 3% or 4%. For practical reasons, these proposals were not retained and forward guidance and QE were the new instruments of choice for many central banks. Before the crisis, the established instrument of monetary policy was a short-term interest rate steered either by traditional open-market operations of buying and selling securities or through temporary lending to banks via repos, like in the ECB’s case. After the crisis, all major central banks significantly increased their balance sheets and the respective monetary base. BIS central bankers’ speeches  1  Chart 1  It would, nevertheless, be misleading to compare the changes in balance sheet size as if they were originated by the same policies and, consequently, had the same impact. The case of the ECB is different from the other central banks as the expansion of the balance sheet happened as the result of lending to the banks through repos of different maturity.

As mentioned, the transmission channels at play in the recent QE experiences are indeed different from the traditional quantitative view. Chart 2  The ECB monetary policy in the European crisis. As the financial crisis led to the Great Recession and then evolved into the European sovereign debt crisis, the ECB started providing liquidity in fixed-rate full allotment mode, progressively and considerably extended the maturity of its loans to commercial banks, widened the set of eligible collateral, made medium-scale purchases of financial assets and announced the Outright Monetary Transactions programme. As a result of these extraordinary measures, at the end of 2012 calm started returning in financial markets, leading to lower financial spreads and a reduction in volatility. The initial  2  Quoted by Michael Woodford in his 2012 Jackson Hole paper “Methods of policy accommodation at the interest rate lower bound”. 4  BIS central bankers’ speeches  signs of economic recovery started appearing. Preliminary formal analyses indicate that nonstandard measures were instrumental in supporting financial intermediation and economic activity in the euro area.3 Despite these recent, encouraging developments on the financial side, real economy recovery has been weak and inflation outcomes have been surprisingly low. The new challenge we face in the euro area today is to avert the risk of a prolonged period of excessively low inflation. Euro area annual HICP inflation was 0.5% in May 2014, after averaging 0.7% in the first four months of the year.
More accurately, what is needed for the koruna to start following an appreciation trend again, like it did before 2008? You can view this as a mathematical equation with three variables. x + y + z = strong koruna I define these three variables as monetary policy, fiscal policy and long-term growth policy. To achieve the result, all three variables, the three policies, x + y + z, must act together, in concert and at the same time. It's not enough to have just one of them. First policy for a strong koruna – monetary policy Monetary policy affects economic activity with a lag of more than a year. This lag complicates the decision-making and communication of inflation-targeting central banks. Let's assume there is no lag in transmission. In that case, it would be enough to stop raising rates as soon as core inflation stabilises, or even better, when it starts falling. However, it's different in reality. Because of the transmission lag, the central bank should correctly stop raising rates before inflation peaks.3 The problem of this  1/4  BIS - Central bankers' speeches  academically and practically correct approach is that people can see that inflation is still high and might think that the central bank is not determined to fight inflation because rates have stopped rising. The economically incorrect approach of raising rates until cost-push inflation turns around leads to an overshooting. The resulting recession will be deeper than necessary.

cnb.cz/cs/verejnost/servis-pro-media/autorske-clanky-rozhovory-s-predstaviteli-cnb /Klausova-draha-permanentka/ 3 https://www.cnb.cz/cs/o_cnb/cnblog/Inflace-v-CR-cyklicky-ci-acyklicky-pribeh/ 4 https://www.cnb.cz/cs/verejnost/servis-pro-media/autorske-clanky-rozhovory-s-  predstaviteli-cnb/Krotitele-nakladove-inflace/ 5 For details, see https://www.cnb.cz/cs/o_cnb/cnblog/Jak-dlouhy-je-spravny-horizont-  menove-politiky/. 3/4  BIS - Central bankers' speeches  6 https://www.cnb.cz/cs/verejnost/servis-pro-media/autorske-clanky-rozhovory-s-  predstaviteli-cnb/Zapisky-z-Jackson-Hole-1-00001.-dil/ 7 https://www.cnb.cz/cs/verejnost/servis-pro-media/autorske-clanky-rozhovory-s-  predstaviteli-cnb/Jdeme-prikladem-brzdime-platy-v-CNB/  4/4  BIS - Central bankers' speeches
An investor, on the other hand, normally needs to have the money over a longer period of time, as it usually takes a while before an investment pays off. The financial sector offers two possible solutions to this conflict of interests. The investor can either turn to a bank, which can convert savings into long-term lending, or the investor can issue securities directly onto the market. In both cases, the saver can normally regain his money at relatively short notice. In the first case, the money is withdrawn from the bank and this works painlessly, unless all the other savers have the same idea at the same time. In the second case, the securities are sold on a secondary market. Without these possibilities to quickly realise savings, there would be much less money channelled into investments, which are of crucial importance for economic development. A properly functioning capital allocation is thus of major importance to a country's long-term growth, which is also confirmed by several empirical studies made in this field. Mohsin Khan and Abdelhak Senhadji have made a review of such studies for the IMF. I can recommend it for those who are interested. Facilitating risk management Then we come to the third fundamental task of the financial sector; facilitating the management of economic risks. As I mentioned earlier, Swedish savers have already realised the importance of not investing all their savings in the same place.

In the June addendum, the FOMC noted that reducing the Fed’s securities holdings will result in a declining supply of reserve balances, and that it anticipates reducing the quantity of reserve balances to a level “appreciably below that seen in recent years but larger than before the financial crisis.” New York Fed staff projections for possible paths of the Fed’s securities portfolio—constructed using a distribution of market participants’ surveyed expectations for the future size of the Fed’s balance sheet (conditional on not moving to the zero lower bound at any point between now and 2025), along with some staff modeling to fill in details—suggest it will take at least several years for the balance sheet to reach its “normal” size.14 Uncertainty about the time of normalization arises from numerous sources, including future levels and variability of demand for different types of Fed liabilities, the pace at which the agency MBS portfolio will pay down, and of course the economic outlook. Assuming that balance sheet normalization continues uninterrupted, it seems likely that the future balance sheet size will be driven largely by changes in longer-run demand for Fed liabilities —in contrast to the asset-driven balance sheet of the past decade. The FOMC explains in the June addendum that reserve balances will be driven by the banking system’s demand for reserves and the Committee’s decisions about how to implement monetary policy in the future.
Conceivably, these differences might be heavily influenced by the relatively recent nature of our educational development; but looking at the percentages for young people in the 25-34 age group, it can be seen that, despite the progress recorded, a gap exists which, though moderate (64% in Spain compared with figures of over 80% in most of the major countries), remains illustrative of our continuing laggardness. In the current decentralised State, the central government retains few responsibilities in respect of education, which means that educational progress in Spain is fundamentally in the hands of the regional governments. These may thus be said to have a major responsibility in determining our longterm growth prospects and the future functioning of the Spanish economy. And this conclusion is further reinforced when considering the changes that have come about in budgetary policies. Hence,  4  BIS Review 32/2007  insofar as the decentralised structure of the State has played a very positive role in growth in the recent past, as I said at the start of my address, when speaking of the future it emerges once again as a determinant of the first order. As is known, public spending by territorial governments is more than two and a half times that of central government. It is clear from this that what regional and local governments do is, for the purposes of maintaining the public spending/GDP ratio, much more important than what central government does.

But if the foreign reserves are evaluated as a percentage of foreign debt, Iceland is relatively weak. On behalf of the Board of Governors, I would like to take this opportunity to thank the many people and institutions whose representatives are here today for a very satisfying collaborative relationship. BIS Review 36/2008  5
The use of the ONS statistical data in this work does not imply the endorsement of the ONS in relation to the interpretation or analysis of the statistical data. This work uses research datasets which may not exactly reproduce National Statistics aggregates. This note applies to all charts and analysis using data from the ONS Research Database. Chart 16: The distribution of productivity across firms  (a) Distribution in 2014  (b) Lower tail of distribution in selected years Density 2014  Density  0.016 0.014 0.012  2002 2008 2014  0.018 0.016  0.014  0.01  0.012  0.008  0.01  0.006  0.008 0.006  0.004  0.004  0.002  0.002  0  0  -0.002 -50 0 50 GVA per worker, £  100  150  200  0.02  -0.002 -50 -30 GVA per worker, £  -10  10  Source: ONS Research Database and Bank calculations. Notes: Gross value added per worker.

Regarding the digitalisation of finance, in addition to the support to the development of regulations, like DORA and MICA, that are intended to facilitate the development of innovations in a confidence and financial stability enhancing framework, we can, as central banks, play a positive operational role in revisiting the central bank money services we provide. This is indeed what we have started to do with the conduct by the Banque de France of 9 experiments which consisted in putting central bank money “on the ledger” for interbank settlement purposes of securities transactions or cross-border payments, and with the launch by the ECB of an investigation phase for a digital euro for merchants and citizens’ daily payments needs. However, let me note here that issuing a retail CBDC raises a number of challenges, in particular because financial intermediaries, including banks, play a key role in the security and financial stability of our monetary and financial system. These challenges need to be addressed by design in the architecture and functionality of a digital euro, for example by introducing holding limits and by promoting an intermediated model. This is why it is essential that the financial intermediaries, along with the other stakeholders, be properly involved in the investigation phase that is currently conducted.
Such reforms, if well designed and fully implemented, will reorient the engines of growth towards high-productivity sectors and enable companies to thrive in the Single Market and in the global economy. Studies based on general equilibrium models have confirmed that the long-run growth effects of such reforms are indeed positive and potentially very high.13 [Slide 9] This is my last chart. It shows model-based simulations carried out for the Portuguese economy by using a large-scale new-Keynesian dynamic general equilibrium model of the euro area and the world economy.14 In the model simulations shown, the wage mark-up is reduced by 10 percentage points over a period of five years. The size of the reduction mimics the cumulated gross wage differential between Germany and the rest of the euro area countries between 2005 and 2010, that is, in the five years after Hartz IV reform. To obtain a comparable set of results, the price mark-up is also reduced by 10 percentage points over five years. These simulations show clearly that to maximise the impact of reforms on GDP and employment it is important that those reforms have to reduce both wage and price mark-ups. The simulations also show that the impact of reforms is positive already in the second year and increases progressively afterwards. All this is consistent with other  13  See Gomes S., P. Jacquinot, M. Mohr, M. Pisani (2011), Structural reforms and macroeconomic performance in the euro area countries. A model-based assessment, ECB working paper no.

In my book, this is not only bad for the needed cyclical recovery in aggregate demand. I suspect that it will impede the rebalancing of the economy’s productive capacity. Firms wishing to enter or expand export markets, or compete against importers, often need credit. Finance is the oil that lubricates the allocation – and so, in current circumstances, reallocation – of capital in our economy. This is manifestly affecting SMEs. My hunch is that housing market conditions are a factor too. As long as anyone can remember, a crucial element of SME finance has been the capacity of entrepreneurs to pledge their home at the outset of a loan or, contingently, if and when their business hits choppy waters. Uncertainties about the path of house prices do not make that a comfortable backdrop for lenders in current conditions. 2  BIS central bankers’ speeches  Rebalancing will affect labour market conditions too. Perhaps the greatest surprise to the MPC over the past few years has been subdued productivity growth. One could think of this as firms maintaining employment at higher levels than would have been predicted given the fall in the level of output. Labour hoarding. That squares with business managers explaining that they worry about “structural” skill shortages and so are loathe to lose employees who they will need when their markets recover. But it does not really square with surveys of business conditions reporting that firms say they are carrying relatively little spare capacity. We have scratched our heads about this.
To illustrate the problem, let’s begin by examining net debt flows in the private nonfinancial and government sectors over the last 10 years. As can be seen in Chart 1, borrowing by the  2  BIS central bankers’ speeches  private nonfinancial sector rose rapidly from 2003 to 2006 and remained high until the crisis hit. Then borrowing turned negative as new loans were more than offset by repayments and write-offs. Only recently has borrowing turned weakly positive. Chart 2 illustrates how the stock of net debt in different sectors of the economy evolved throughout this period. It shows that much of the credit boom was concentrated in the household sector. The business sector only experienced a surge from 2006 onward. During the boom, leverage also increased in the financial sector. As the boom proceeded, credit losses were low and earnings strong. But once the bust began, this dynamic reversed. Credit losses at financial institutions surged and the sector was forced to deleverage rapidly and raise new capital. This resulted in a significant contraction in the availability of credit and was a major direct shock to the global economy. Crucially, this tightening of credit standards exacerbated how much many households and firms had to deleverage. It also crimped demand, inhibiting economic, employment and income growth, which in turn made the deleveraging process more challenging.

The origins of the crisis are complex, but it had its roots in the bursting of a credit bubble that had grown to great size during the middle part of the last decade. Prior to the onset of the crisis, a combination of rapid financial innovation and unbalanced global economic integration resulted in a mispricing of risk worldwide. This was particularly extreme in certain markets such as U.S. housing and housing finance. This mispricing of risk led to a misallocation of resources and an excessive build-up of debt in many parts of the global economy. Many – though not all – U.S. households responded to the easy availability of credit and rising home prices by taking on more debt. When the housing boom lost steam and began to burst, expectations about housing prices and wealth were disappointed. The bursting of the credit bubble also created instability within the global  BIS central bankers’ speeches  1  financial system, and this in turn resulted in a sharp constraint in the availability of credit for households and businesses. The result was what is now called the “Great Recession.” Over the period from late 2007 through mid-2009, real gross domestic product (GDP) declined more than 5 percent, making this recession the longest and deepest recession of the postwar period. The recession manifested itself in many ways, but one of the most painful was the severe impact it had on the labor market.
The industry experienced a compound average growth rate of 27 percent in terms of net contributions between 2005–2010, with family takaful driving the growth at 28 percent for the same period, to dominate more than 80 percent of the total takaful market in 2010. The strong growth momentum is expected to continue, underpinned by the rising affluence of Malaysian amidst strong economic fundamentals. Given the large untapped market that still exists with only 54 percent of the population having a life insurance or family takaful policy, the takaful industry is poised to benefit in the years ahead. Today’s launch is thus an important step in our overall strategy to further elevate the growth and development of the takaful industry. ING Public Takaful Ehsan is the 3rd licensee to launch out of the 4 family takaful licences awarded recently, making up to a total of 11 takaful players now operating in Malaysia. The initiative for strengthening competition in takaful industry is premised on our quest to unlock the enormous growth potential that lie ahead. There are 3 dimensions from which strong opportunities for growth can be harnessed in the takaful industry. First, is the opportunity to penetrate the remaining underserved areas in family takaful. One such area is medical and health, which in 2010 constitutes only 9 percent of new family takaful business.

It is our earnest aspiration that the entry of ING Public Takaful Ehsan will further add to the dynamism and vigour of the takaful industry. With this strategic alliance between 2 financial groups of such calibre, Bank Negara Malaysia looks forward to strong management stewardship, innovative product offerings, wide distribution channels, operational and service excellence as well as breakthrough business strategies that are well-matched by robust risk management capabilities. I am confident that ING Public Takaful Ehsan will benefit greatly from the synergies and complementary strengths of its shareholders, by drawing upon the combined wealth of market experience, technical underwriting expertise, multi-channel distribution network and infrastructure, to successfully make its mark as one of the leading takaful operator, both domestically and on the global front. 2  BIS central bankers’ speeches  In the pursuit to seize the growing business opportunities in the increasingly competitive environment, building a pool of highly skilled and knowledgeable workforce must remain a strategic priority for takaful operators. As a knowledge-intensive industry, human capital can indeed be a potent weapon of competitive advantage for the industry. As the industry seeks to achieve a higher level of competitiveness, increased product complexity, business sophistication, service excellence and the global nature of competition are all demanding greater depth and breadth of leadership, knowledge, competence and skills of industry professionals. Adding to the demands for increased organisational capabilities is the changing regulatory landscape towards risk-based capital, soon-to-be implemented for the Malaysian takaful industry, which places greater prominence on strong risk management culture.