samchain/econo-pairs-v1 huggingface dataset:
But, given insipid and uncertain demand, not a few firms seem to have temporarily suspended part of their capacity: whether by putting part of their workforce on short hours or closing down a production line. This makes it likely that supply conditions are going to depend heavily on the path of aggregate demand. If demand recovers robustly, firms are likely to bring some capacity back on line. If, on the other hand, demand proves anaemic, then suspended-capacity is more likely to be permanently scrapped. Under the first scenario, inflationary pressures could be weaker than would otherwise be the case in a recovering economy. Under the latter scenario, inflationary pressures would be greater than otherwise in a stalled economy. I do not want to go so far as saying that the path of aggregate demand won’t affect inflation, but it may not be quite as potent as usual. Viewed more broadly, provided we do not take risks with inflation – as we must not and will not – the robust-growth path would plainly be preferable as it would avoid wasteful impairment of the economy’s productive potential, and so of living standards in the years  2  See Blinder Alan S. (1987), “Credit Rationing and Effective Supply Failures” Economic Journal, June 1987, 97, 327–52. BIS Review 21/2010  3  ahead.

The counterpart to placing greater weight on the level of and fluctuations in risk premia is being more attentive to money and credit quantities. There is plenty of such interest at present of course, as evidenced by the number of mentions in the minutes of the MPC’s meetings. But we must ensure that interest is sustained. And in a world of global banking and capital markets, that surely means looking at wider measures alongside our normal broad money (M4) aggregates. It is surely not at all uncommon these days for firms around the world to hold part of their currency liquidity with banks overseas. At the Bank, we have had another go 7 at creating a wider measure of UK money growth that takes account of international deposit-taking activity (Chart 13), and also at similar measures of “world money growth” (Chart 14). In both cases, the swings over the past decade are more pronounced on the wider measure, especially for the UK. I am particularly struck that these aggregates start to pick up during late 2003, just about the time when the Bank’s  3  Carney M (2009), “Some considerations on using monetary policy to stabilize economic activity”, remarks to a symposium sponsored by the Federal Reserve Bank of Kansas City, Jackson Hole, Wyoming. 4  See Bank for International Settlements (1986), “Recent innovations in international banking”, prepared by a Study Group established by the Central Banks of the Group of Ten Countries, known as the “Cross Report”.
Lending growth rates remained high in all segments, which is the main indicator evidencing that monetary conditions remained accommodative, rather than neutral in the third quarter as well. 2/4  BIS central bankers' speeches  Over the period from the September meeting to yesterday, yields on federal government bonds rose by 50–60 basis points. The increase in short-term yields suggests a revision of market expectations regarding the key rate, whereas growth in long-term yields is driven by the trends in global markets. Deposit rates continued to go up in September—October, although more slowly than in the previous months. Deposit terms are not yet sufficiently attractive to boost households’ demand for this form of savings. As regards lending, the corporate segment continues to expand steadily. Growth in consumer lending has slowed down somewhat. As regards the mortgage segment, after a slight deceleration in July—August due to the revision of the subsidised mortgage lending programmes, growth sped up again in autumn. In this context, we have revised our forecast range of retail lending growth for this year upwards by 3 percentage points to 21– 25%. The forecast for lending in the economy in general remained unchanged. Currently, the actual changes in the credit market are obviously not sufficient to form such monetary conditions that would help bring inflation back to 4% and stabilise it at this level. Our today’s decision will accelerate the adjustment in the credit and deposit market. As regards risks to the forecast, proinflationary ones currently prevail.

The unemployment rate has decreased close to its record lows, while the number of vacant jobs has approached its record high. To fill the new jobs, we need either an inflow of labour migrants, or a redistribution of the current labour force among regions, industries, and enterprises. This process is objectively slower than the return of the available labour force to work during the period of the recovery growth. A higher competition for specialists between employers is promoting the conditions for an increase in wages. It is essential that a rise in wages is consistent with the growth of labour productivity in the relevant sectors. Otherwise, it will entail higher costs which enterprises will pass on to consumers, and the rise in nominal wages will be ultimately absorbed by inflation. We keep our GDP forecast unchanged for the next year and further on. An additional tightening of monetary policy aimed at returning inflation to the target is coherent with the positive contribution of external demand and investments from the National Wealth Fund made to aggregate demand. GDP will increase by 4–4.5% this year and by 2–3% further on, which is in line with the sustainable growth path. Monetary conditions have changed only slightly after the September meeting. An increase in market rates following the rise in the key rate currently has only a limited effect on them. This is largely associated with the impact of higher inflation expectations.
Page 1  Reflections on DeFi, digital currencies and regulation speech by Jon Cunliffe Given at Warwick Business Schools’s Gilmore Centre Policy Forum Conference on DeFi & Digital Currencies  Page 2  Published on 21 November 2022  In his speech Jon Cunliffe reflects on recent crypto market developments. He goes on to talk about the work that authorities are doing on the regulation of crypto stablecoins and our work on a potential central bank digital currency. Speech I had intended today to talk about the work the Bank of England, is doing with the Treasury, the FCA on the regulation of crypto stablecoins and our work on a potential central bank digital currency in Sterling. That remains the bulk of what I will talk about today. But between beginning to draft these remarks and delivering them today, we have seen what is probably the largest – and certainly the most spectacular – failure to date in the crypto ecosystem, by which of course I mean the collapse of the crypto trading platform FTX and most of its associated businesses. So I thought it might be worthwhile to start with a brief look at the FTX implosion to frame some of the points I intend to make on regulation of the use of crypto-related technologies to provide financial services and on why, as a central bank, we are actively exploring the issuance of a digitally native Pound sterling.

It is, of course, possible that neither of these two reasons - investor protection and protection against financial stability risk - will be relevant because the very instability and riskiness of the world of unregulated crypto finance, most recently demonstrated by FTX, will in the end ensure that the sector cannot grow. Indeed, some have argued for regulators grappling with the crypto world to keep it outside the regulatory framework to ensure that users’ ‘caveat emptor’ concerns prevents both growth and connection with mainstream finance[4]. And that leads to my third reason. Forecasting the direction and pace of technological innovation is an even more uncertain game than economic forecasting. Promising technologies fall by the wayside; unexpected ones flourish. And technologies combine in ways that cannot be anticipated. But the technologies that have been pioneered and refined in the crypto world, such as tokenisation, encryption, distribution, atomic settlement and smart contracts, not only seem unlikely to go away as our everyday lives become more ‘digital’, but may well have the potential to improve efficiency, functionality and reduce risk in the financial system. A potential example of this is the integration of functions in ‘smart contracts’ that I mentioned earlier. A possible use case for such integration, which has been pioneered in the defi world is the combining the functions of trading, clearing and settlement of tokenised financial assets into a  Page 6  single, instantaneous contract, rather than being carried out in sequence by three separate institutions over a number of day.
And I am convinced that moderate reforms adopted in sufficient time will not only help resolve long-term problems but, by offering reassurance and reducing uncertainty over the future, they will also have favourable effects in the short run in the difficult economic circumstances currently besetting us. BIS Review 51/2009  5

I am glad that we were able to have the service of Prof. Peter Sinclair of university of Birmingham who h as served as Director, Centre for Banking Studies, of the Bank of England to conduct this programme. Ladies and gentlemen, let me highlight some interesting developments in the evolution of central banking and some challenges faced by central bankers. The role of central banks has evolved over past several decades. You may recall that the original task of central banks was not the conducting of monetary policy or supporting the banking system but financing government spending. The oldest central bank of the world, the Bank of Sweden was established in 1668 largely as means to finance military spending . The Bank of England was said to have been created in 1694 to fund a war with France. Even as recently as late 1940’s a labour chancellor of the exchequer, Stafford Cripps was said to have described the Bank of England as “ his bank”. Today, it is a taboo for most central banks to finance government deficits. Most countries have managed their affairs without a central bank for a long time. At the beginning of this century there were only 18 central banks. The USA managed without a central bank until 1913. Private banks issued their own currency notes and coins and banking crises were fairly frequent. The Federal Reserve Bank of USA was established mainly to supervise banks and act as lender of last resort.
Kristina Persson: Monetary policy yesterday, today and tomorrow Speech by Ms Kristina Persson, Deputy Governor of the Sveriges Riksbank, Aktiespararna Lindingö, Stockholm, 9 November 2005. The diagrams for this speech can be found on the Sveriges Riksbank website www.riksbank.com. *  *  *  Thank you for the invitation to come to Aktiespararna Lidingö this evening to talk about monetary policy, which is for me a job and – I assume – for you an interest, as you save in shares. It is of course important for those investing in companies to obtain a good (risk-adjusted) return on their investment. Monetary policy that contributes to low and stable inflation leads to less uncertainty, clearer game rules and better conditions for growth. I intend to begin with a look back over monetary policy during the past decade and a description of the sequence of events when we changed over to inflation targeting after the economic crisis in the early 1990s. After that I shall briefly discuss the current economic situation, mention the changed conditions I envisage and what they may entail for monetary policy in the future. From economic crisis to 10 years of inflation targeting Many of you will remember and will have been affected in some way by the economic crisis at the beginning of the 1990s. That was when the foundations of the current monetary policy were laid; when the fixed exchange rate was abandoned as a monetary policy objective and replaced by an explicit inflation target.

There are many indications that an increasing number of companies are now approaching the limit where they can no longer meet the increase in demand without recruiting new staff. We are thus beginning to see signs of a turnaround, but the question of the labour market and the significance of monetary policy for employment remains important. To what extent can the problems in the labour market be said to be due to the Riksbank having conducted an excessively tight monetary policy? If we had succeeded in predicting the high productivity we would probably have conducted a slightly more expansionary policy, but my answer is nevertheless that one is overestimating the power of monetary policy if one believes that it could have solved the problems in the labour market. A large part of unemployment is due to structural reasons and therefore does not vary according to the economic cycle. I do not believe that it would have led to so much higher consumption and investment if the repo rate had, for instance, been on average half a percentage point lower during 2002 and 2003. My assessment is thus that it would probably have led only to marginally lower unemployment. If one wishes to achieve a lasting improvement in employment, measures are required that will stimulate the functioning of the labour market in different ways and lead to investment and a good corporate climate.
It is hugely more complex than macro-economic management, being affected as it is by the whole range of public policy issues, often involving difficult political judgements on how to strike the right balance between social and economic considerations. I will have little more to say about the supply side. My involvement is on the macro-economic side. Macro-economic management can do relatively little directly to contribute to improvement on the supply side, but - if we succeed in maintaining stability we can nevertheless contribute to more rational economic decision-making by the private sector, based upon real rather than purely nominal considerations; and that can help improve our supply-side performance indirectly. As the emphasis of macro-economic management - overall fiscal policy and monetary policy taken together - shifted towards stability, a growing distinction emerged between the role of overall fiscal policy, which is set for the medium term, and a more specific role for monetary policy, which became the principal instrument for shorter-term stabilisation. This distinction crystalised first with the adoption of an explicit inflation target as the objective of monetary policy, following our exit from the ERM in 1992, and subsequently, in 1997, when the Bank, through the Monetary Policy Committee, was given independent operational responsibility - legitimised through transparency and public accountability for the achievement of the Government's inflation target.

The Rt Hon Sir Edward George GBE: Macro-economic management in the UK Speech by The Rt Hon Sir Edward George, Governor of the Bank of England, at the 2001 Institute of Directors Convention, London, on 25 April 2001. *  *  *  The theme of your convention is change - and as a general observation what's always struck me about change is that it's not simply a one-off event - a discrete step from A to B. Change is a continuing process - and once you've embarked upon that process it's not always clear where it will lead. You either embrace the process, notwithstanding the uncertainty, it seems to me, or you resist it, with the risk then that the world changes around you and begins to pass you by. What is certainly true - in this country but much more widely internationally - is that there has gradually over a long period been a very profound change in the approach to overall economic management. For a long period after World War II the emphasis of macro-economic policy seemed to concentrate on aggregate demand management, with too little attention paid to the constraints imposed by the supply-side capacity of the economy to meet that demand. When growth and employment were judged to be insufficient, monetary and overall fiscal policy were used in combination to provide a stimulus to the economy, often supported by direct controls of one kind or another to suppress the emerging symptoms of increasing pressure on resources.
When an indirect tax is raised, it is assumed that the price of the product concerned increases by the entire amount of the tax. But in practice the company or shop selling the product can rarely increase the price by the full amount; usually only by a part of it. Demand would otherwise decline too much. But when the CPIX is calculated, the entire tax increase is deducted. An increase in indirect taxes can thus have the paradoxical effect that the CPIX falls. Another complication is that excise duty is normally written up by some measure of price movements. This in turn is because the tax on, for instance, alcohol is not expressed as a percentage of the price but as SEK per litre. Correspondingly, the taxes on energy and tobacco are stated in terms of SEK per kilowatt-hour and SEK per gramme. If all prices rise by 2 per cent a year, then the excise duty's share of the consumer price would fall over time. To prevent this from happening, excise duties are indexed. The excise duty on, for instance, petrol is written up by the annual rate of increase in the CPI in June of the previous year. But when the CPIX is calculated, each increase in excise duties is deducted from the CPI, even if it is only due to indexing. This means that the indexing of excise duties also contributes to a difference in CPI inflation and CPIX inflation in the long term.

This is because at least some of the houses bought prior to the price rise today are sold at a higher price. The calculated mortgage interest expenditure for home-owners can thus change even if the interest rates remain unchanged, if the acquisition value of the housing stock changes. This is an effect that will have significance in the future. House prices have risen over a long period of time, and this will gradually have an impact on the capital stock index. Without going into any technical details regarding calculation methods, one can observe that this is the main reason why mortgage interest expenditure for home-owners will increase in the coming years – or, in other words, why CPIX inflation will be below CPI inflation. The Riksbank is assuming that the difference in the rate of increase between the CPI and the  BIS Review 73/2008  3  CPIX as a result of the housing stock increasing in value will be approximately 0.2 percentage points several years ahead. The fact that mortgage interest expenditure for home-owners is affected not only by changes in interest rates but also by the way house prices develop comes as no surprise. But one can say that the trend rate of increase in the capital stock has meant that the problem has gradually become more tangible. Other problems with the CPIX There are also other problems with the CPIX, related to calculation methods, which have perhaps not received so much attention. The CPIX measure adjusts for indirect taxes.
2  BIS central bankers’ speeches  Taking the budget deficit observed in 2015, of 5% of GDP, the Spanish general government sector has reduced the scale of this imbalance by more than 6 pp, from its peak in 2009. However, on the latest European Commission estimates, the structural budget deficit, i.e. the non-cyclically adjusted deficit, was over 2.5% of GDP, while the public debt/GDP ratio was 99.2% in 2015, having stabilised relative to a year earlier but more than 60 pp of GDP above its 2007 level. Such a high volume of public debt evidently entails considerable refinancing requirements on the capital markets. That heightens the vulnerability of our economy, as was patently clear during the euro area sovereign debt crisis from 2010. Every year, our general government sector must obtain funds equivalent to more than 20% of our GDP, involving major dependence on the markets and on expectations about our economic and political situation. But the problems posed by such a high level of public debt, even under expectations of its gradual reduction, are not confined to the consequent dependence on the capital markets. A high level of public debt, even in the current environment of low or very low interest rates, involves debt service with considerable interest payments.

The reforms since 2011 to the public pension system (the progressive raising of the retirement age; the definition of a sustainability factor linking the initial pension to changes in life expectancy; the introduction of a new pension indexation system; and the segregation from the system of specific non- contributory pensions that should be financed through general taxes and not through social security contributions) have been in the right direction as far as the sustainability of the system is concerned. Apart from these reforms, there are insurance and saving mechanisms that can help supplement the unfunded pension system. But, as I said earlier, a key factor for the public pension system is the buoyancy of employment. It is in this nexus between employment, pensions and public finances where, I believe, the “hard core” of the difficulties facing our economy in the years ahead is concentrated. 3. The reduction in private debt and in the net external debit position  The third challenge facing the Spanish economy is high private debt and the heavy dependency on external financing. The Spanish economy’s net external debit position stood at around 93% of GDP at end2015, far above the level in other euro area or developed countries in a debit position, not to mention core Monetary Union economies such as Germany, Belgium and the Netherlands, which run an external credit position.