samchain/econo-pairs-v1 huggingface dataset:
However, I personally thought there were a number of factors in the global economy that made the forecast unusually uncertain. Prior to the meeting in July, there had been considerable fluctuations in the financial markets, which were largely due to the uncertainty over when the Federal Reserve will begin phasing out its quantitative easing. There was also uncertainty over what effects the problems in the Chinese banking sector would have on the Chinese economy and also, as has been the case for a long time now, over developments in the euro area. Economic developments in the euro area are still marked by the need for the private and public sectors to reduce their debt, which is a process that will of course take a long time. However, compared with one year ago, developments had been in the right direction in most of the problem countries and a number of measures had been taken that led to interest rates  BIS central bankers’ speeches  1  falling to lower levels. Our assessment in July was based on the assumption that the reform process would continue and the forecast was that GDP growth in the euro area would remain weak but gradually increase. However, the slow recovery means that GDP will not reach the same level as prior to the decline in 2009 until 2015.

Monetary policy needs a more long-term focus As I see it, we need to make it clear in the monetary policy analysis how monetary policy affects the risk of a financial crisis arising and how such a crisis scenario would look. As financial imbalances usually build up over a long period of time, this means that, in practice, we need to look beyond the three-year perspective that normally forms the base for our forecasts. Monetary policy is already forward-looking, but with a more long-term focus we could also include target attainment in the longer run. So, to what extent can monetary policy affect the probability of a crisis occurring? Well, it is mainly the effect of the repo rate on debt that is important in this context, as the probability of a financial crisis increases when indebtedness is high or when debt increase at a faster rate than normal.2 As the interest rate entails the cost of taking on debt, monetary policy has an effect on indebtedness. In the short-term perspective it seems as though the relationship between the repo rate and household debt is not very strong. However, if households expect the prevailing low interest rates to persist, and therefore increase their debts to unsustainable levels, the effects can be substantial.
Market interventions in 2000 and 2001 depleted the Central Bank’s foreign reserves, creating a pressing need to strengthen it. The  2  BIS Review 45/2003  Central Bank has been engaged on this task and will continue to do so. It had purchased foreign currency for the equivalent of 30.7 b.kr. since September 2002, which has undoubtedly exerted some impact on the króna in the short run, although the long-term effect is negligible, if any at all. The exchange rate for the króna plummeted in 2000 and 2001, and for quite some time was substantially below a level reconcilable with long-term equilibrium. This occurred at a time when the price of key exports was very high, making the years 2000 and 2001 especially favourable for the export sector and in fact also for import-competing sectors. Enterprises in these sectors understandably felt the effects of the rise in the exchange rate in the first half of this year. It is not to be expected, however, that the same conditions will re-arise in these sectors as prevailed, for example, during 2001 and in the early part of 2002. The exchange rate remained very stable from spring to early winter 2002, when the króna entered a strengthening phase which continued until the beginning of February. The Central Bank has stated its view that the appreciation over this period was primarily the effect of planned aluminium-related investments in East Iceland.

A 2½% increase in public consumption is expected for both years. Gross fixed capital formation, however, is expected to grow by 10¾%, mainly as a result of investments connected with the aluminium industry. Forecast investment in residential housing is 3%. Exports will increase by 2% this year and 4% next year, according to the forecast, due to the increased fishing quotas that I mentioned earlier. Growth of imports is expected to be 4½% this year and 7% in 2004. Despite higher forecast output growth this year, unemployment is expected to be a quarter of a percentage point higher than was forecast in May, at 3¼%. Estimated slack in the labour market this year has been revised upwards. However, unemployment is expected to head down to a figure of 2½% next year. Although higher output growth is expected this year and next year, the output gap is forecast to become slightly negative. A revised estimate now shows a slightly negative output gap last year, which will widen even further in 2003 since output growth is below estimated growth of potential output. The output gap is expected to turn marginally positive next year, when output growth will exceed potential. However, it is important to bear in mind that the evaluation of the output gap is highly uncertain, due to the non-observable nature of potential output. These data do show, however, that good balance is expected in both 2003 and 2004. The Central Bank forecasts inflation up to two years ahead.
Zeti Akhtar Aziz: Raising standards in Malaysia’s financial services industry Remarks by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Centre of Excellence (ACE) Ground Breaking Ceremony, Kuala Lumpur, 22 February 2016. *  *  *  It is my very great pleasure to be here on the occasion of the ground breaking ceremony to the ACE – A Centre of Excellence. ACE is a very much welcomed industry led initiative to raise the level of capability and professionalism for the work force in the Malaysian financial services industry. Our financial services industry continues to be reshaped and transformed by several major forces of change that range from the new demands of consumers and businesses to the rapid advancement in technology, the global regulatory reforms and the continued globalisation of finance. On the domestic front we are also seeing the continued rapid expansion of the domestic financial services industry, and the deepening of regional economic and financial integration. Given the paramount role of the financial system in supporting our real economy we require a financial system that will best serve our economy. It not only needs to be effective and efficient and thus competitive but also robust and resilient. Going forward, operating in this highly dynamic environment will become increasingly more challenging. Today the Malaysian financial industry employs more than 150,000 people, and requires approximately 73,000 new hires over the next 10 years.

With the changes that are reshaping the financial system, skills requirements in the financial industry will also change. Today new careers are also being created in more diverse areas including in areas of finance that have leveraged on technology such as in internet based services. Further challenges will arise from the intensification of competition for talent in a more borderless workplace. Given the importance of talent to performance greater attention needs to be accorded to talent development. There also continues to be an acute talent shortage of such skilled talent in our financial services industry. If left unresolved it will impede future growth and performance of the industry. This existing significant skills gap is already becoming a constraint on industry growth. Indicators from the AIF Skills Gap Index, which measures skills gaps within the workforce, point to a significant deficit in several skill sets that are considered important in the financial services industry. The creation of ACE represents an important step in efforts to provide a comprehensive and integrated solution for such skills and talent development for the industry. At the executive level, leadership, corporate governance and ethics are issues that have dominated attention in global finance given the need to recognise the importance of sustainable outcomes. There are high expectations of the financial industry to demonstrate responsible leadership that will also embrace a strong moral compass in its operations. Education and professional development have a key role in bringing to the forefront these important issues for the industry.
One name that has gained popularity is the “Great Recession”, which is dated as beginning with the bankruptcy of Lehman Brothers on September 15, 2008. This name conveys both the severity of what occurred, as well as the calamity of what was avoided. The contraction in real output in the six months following the demise of Lehman Brothers exceeded in size any other post World War II recession – in that sense, it was a great recession. However, aggressive monetary and fiscal policy actions both domestically and abroad were successful in preventing a complete meltdown of the U.S. and the world economy. In that sense, the name also emphasizes what the crisis was not. However, the name tends to focus one’s attention too much on the effect and not the cause of the crisis. An alternative name is the “Panic of 2007”, which is dated as beginning with the announcement by BNP Paribus on August 9, 2007, of its suspension of redemptions for three of its investment funds. This name stresses the financial crisis as the precipitating event leading up to the severe decline in real economic activity slightly more than a year later. The name conveys that at its very basic level, the crisis was a form of a banking panic. The parallel to the name “Panic of 1907” is also a reminder to us that history has a way of repeating itself unless we learn and apply its lessons well.

14 In December, the FOMC announced that it would begin to significantly expand its balance sheet through purchases of long-term assets including agency debt, agency mortgage-backed securities and long-term treasuries – the Large Scale Asset Purchase or LSAP program. Other interventions were taking place directed by different agencies and in conjunction with the Treasury. At the same time, fiscal policy was engaging with Congress approving the $ billion Troubled Asset Relief Program (TARP) program. Policy had entered the “whatever it takes” phase in an effort to keep the Great Recession from becoming something much worse. 15 By the spring of 2009, the various guarantees and backstop liquidity facilities covering different sectors of the shadow banking system were in place. The last element required to deal with the Panic of 2007 was to address the uncertainty over the viability of the large systemically important financial institutions. A horizontal review of the 19 largest financial firms was conducted to assess their capital needs under a “worse-than-anticipated economic scenario” – this was called the Supervisory Capital Assessment Program or SCAP (you can tell that we are fond of acronyms). There were two design features of the SCAP program that were essential for its ability to reduce the uncertainty in financial markets. First, the process was designed to be transparent with both the methodology published up front and the firm-by-firm results published at the conclusion. Second, if a firm was deemed to need capital but was unable to raise it in the  14  See Brian Sack. 2010.
I should of course start by re-iterating the firm HKSARG policy of keeping our exchange rate to the US dollar within the range of 7.75 to 7.85 through the linked exchange rate system, characterised by currency board arrangements that require our monetary base, and any changes in it, to be 100% backed by US dollars. With the weakening US dollar and the strengthening renminbi; with the local inflation rate, excluding the temporary effects of tax relief, edging higher; with an “asset bubble” on the lips of many commentators; with the exchange rate hitting the strong side Convertibility Undertaking late last month, requiring our passive and un-sterilised foreign exchange intervention, injecting quite a lot of Hong Kong dollar liquidity into the inter-bank market; and with current US monetary policy possibly becoming inappropriate for Hong Kong; questions have understandably been raised on the appropriateness of the system. Let me provide answers to these questions. First, the appropriateness of the linked exchange rate system should be judged by its ability to deliver monetary and financial stability in Hong Kong through economic cycles, and should not be judged by the short-term cyclical conditions of the economy relative to that of the US economy. The linked exchange rate system has served Hong Kong extremely well since its establishment.

Remember that the portfolios selected for the review amount to 58% of the risk-weighted assets of the 128 institutions, i.e. some € trillion, which will involve reviewing in detail an average of 1,250 credit records per bank. In Spain, we calculate that the review will affect assets valued at € billion, and will require the analysis of more than 21,000 loan records. The second part of the assessment will consist of the stress test. The aim of this exercise is to analyse the ability of banks to maintain appropriate solvency levels in two different scenarios: a baseline or more likely scenario, and another alternative, highly adverse scenario, with less likelihood of occurrence. The stress test is being developed in collaboration with the European Banking Authority (EBA). The methodology of the exercise is currently at the review stage following the finalisation some days back of the public consultation process. The final version of the methodology and details of the macroeconomic scenarios are expected to be published towards the end of this month. The implementation and quality control stages of the stress test will commence from next month, meaning there will be some overlap with the asset review exercise. The outcome of the comprehensive assessment will be made known in late October, and will include both the results of the asset quality analysis and of the stress test.
Many of the tech skills required to do the jobs I have described earlier are in short supply locally. We are fortunate that global and local financial institutions have invested heavily to build up strong technology teams in Singapore. Technology talents from abroad have brought with them valuable experience and expertise that we do not have enough of in Singapore. The surge in demand for technology jobs has benefitted Singaporean workers. The share of Singaporeans in tech jobs has remained stable at about 35% over the years. But with the rapid expansion of the technology workforce, it meant 2,200 more tech jobs for Singaporeans. This is a more than 30% increase in 5 years, from 6,700 jobs in 2014 to 8,900 jobs in 2019. Let us take a deeper dive into the various kinds of technology jobs. The proportion of Singaporeans taking on technology jobs is uneven across diﬀerent roles. Singaporeans account for 70% of the net job growth for cybersecurity engineers and UX/UI designers; and 50% of the net job growth for data analysts and data scientists. This is encouraging, given that these are in-demand roles. But these are also niche roles where hiring numbers are relatively small. The strongest demand - and biggest shortage in local skills - is for so ware engineers. In 2019, net job growth in so ware engineers was 200, 10 times more than that for UX/UI designers. Less than 20% of these 200 so ware engineer jobs went to Singaporeans.

One, when financial institutions set up new technology functions in Singapore, MAS works with them to facilitate capability transfer from foreigners to the local workforce. When we started attracting innovation labs in 2015, the Singaporean share in jobs created at these labs was just 40%. With more labs set up over the years and more Singaporeans exposed to innovation work, Singaporeans now make up about 60% of the 180 high value jobs created at these labs. Two, IMDA partners financial institutions through the TechSkills Accelerator (TeSA) initiative to train and place fresh and mid-career professionals into tech roles. Since 2016, more than 500 professionals have been placed into tech roles in the financial sector, such as so ware developers and data analysts, through Company-Led Training and TeSA Mid-Career Advance. Three, MAS works with financial institutions to support individuals from outside the financial sector transit into tech roles in the sector. Through the Technology in Finance Immersion Programme (TFIP), MAS has been working with IBF and Workforce Singapore to support individuals with STEM capabilities through industry-curated training in specific tech skills followed by a work attachment with a financial institution From 70 trainees in 2019, we now have 190 participants. 1 out of 3 are from the mature age group or were unemployed when they enrolled in TFIP. This year, under the refreshed TFIP, there is indicative oﬀer of around 400 traineeships across more than 20 financial institutions. There will be 10 specialist tracks oﬀered in this run, twice the number as before.
For a couple of decades we had failed to keep price and wage increases in check. However, a fixed exchange rate relationship is not, of course, compatible with an inflation rate that systematically exceeds that in the country to which the exchange rate is tied – sooner or later the exchange rate relationship must collapse. The rapid increases in wages and prices also repeatedly came into collision with the fixed exchange rate and the result was that the Swedish currency was devaluated on several occasions from the mid-1970s onwards. The economy was thus characterised by "boom-bust-cycles” with alternate strong acceleration and sudden braking. However, the fact that the fixed exchange rate did not work as a nominal anchor in Sweden does not mean that it could not function well in other countries; it has unquestionably done so in many cases. So let me therefore move on and mention some general advantages and disadvantages of the two methods. 3  2  See Easterly, W. and S. Fischer, (2001), “Inflation and the Poor”, Journal of Money, Credit, and Banking 33, 2 (part 1), 160178. For a more detailed account of the advantages of low, stable inflation, see for instance King, M., (2002), ”The Inflation Target Ten Years On”, Speech at the London School of Economics, November 19. 3  A more detailed discussion of the advantages and disadvantages of these and other monetary policy regimes can be found in, for instance, Mishkin, F.S., (1999), ”International Experiences with Different Monetary Policy Regimes”, Journal of Monetary Economics 43, 579-605.

In 2016 intra-regional trade contributed USD521 billion or 23.5% of total trade. IntraASEAN investments rose to a record level of USD24 billion in 2016 and accounted for 25% of total FDI flows into the region. Within the region, Indonesia and Thailand are important partners to Malaysia both in trade and direct investments where there is continuous growth propelled by inter-company linkages and cross-border investments. In 2016, Malaysia shared a bilateral trade volume of USD13.8 billion with Indonesia and USD13 billion with Thailand. However, only 5.8% and 11.4% of our trade with Indonesia and Thailand, respectively were settled in local currencies. This is an enormous business opportunity for the financial sector, which has yet to be realised. Similarly, on the investment front, Malaysia has invested USD13 billion and USD2 billion of direct investments into Indonesia and Thailand, as at second quarter of 2017. Indeed, the completion and enhancement of the Frameworks is an important step towards the use of local currencies to support cross-border settlements for trade and direct investments among the three countries. It is an opportunity to mitigate the impact of volatilities in major trading currencies on regional trade and investment activities. We can recall the Global Financial Crisis, where the tightening of global US dollar liquidity was a contributor to the 19% contraction of total trade and 11.5% contraction of total inward FDI into the region.
The Riksbank has chosen to publish minutes of Executive Board meetings after an interval of 6–8 weeks; the minutes are to reflect the discussion and indicate how the members voted. The clearly independent status that has now been assigned to the Riksbank has much to do with this choice. The minutes make it easier for policy evaluators to follow the formation of monetary policy and assess the actions of Board members. This is a democratic interest. Moreover, the fact that the voting will be published probably increases the members’ motivation to form a personal opinion about the difficult matters that have to be considered. I also believe that access to the minutes can help people to understand the choices that have to be made in the formulation of monetary policy and demystify what the Riksbank is doing. It is arguments of this type that made my British colleague Mervyn King declare, with reference to the work of the Bank of England’s Monetary Policy Committee, that ‘Divided we stand, united we fall’. I want to emphasise that these matters are by no means simple. It seems to me that a clear analytical framework, combined with a high degree of transparency, has provided a good foundation for Swedish monetary policy in recent years. But with an Executive Board consisting of six members, each of whom is in a position to voice an opinion on monetary policy, it is probable that from time to time the Riksbank will be criticised for being indistinct.

But transmission through the exchange rate channel is uncertain and volatile, as the exchange rate is also an asset price that fluctuates with speculative capital flows and can deviate from equilibrium over time, only to correct quite suddenly. Unless the financial system is even better protected, this process can interact very badly with financial stability, as was the case in Iceland during the financial crisis. In its publications “Monetary policy in Iceland after capital controls” and “Prudential rules following capital controls”,2 the Central Bank has described the framework that it considers appropriate to replace the pre-crisis framework. Much of what is described in the two reports has already been put in place, but the final brushstrokes remain undone. We intervene in the foreign exchange market; i.e., we have a managed float and not a free-floating currency. We have adopted prudential rules that greatly reduce the banks’ opportunities to take risks with their foreign currency balance sheets. We have established a Financial Stability Council and a Systemic Risk Committee in order to monitor financial system risk more effectively than we did previously, and we are developing prudential rules and macroprudential tools to respond to systemic risk. This will make the conduct of monetary policy easier. And in addition, I hope that statutory amendments will be passed soon in order to put brakes on foreign-denominated lending to resident borrowers without foreign currency income and assets.