samchain/econo-pairs-v1 huggingface dataset:
(3) INE denotes salaried formal employment; AFP measures number of dependent contributors, salaried public workers, and household help whose employer made normal payments to the individual pension fund capitalization account; AFC refers to number of dependent contributors (salaried private workers) whose employer made normal payments to unemployment insurance. Sources: Pontifical Catholic University Survey Center, INE, Superintendency of Pensions, and University of Chile. Figure 4 Employment by skill level (1)(2) (difference with respect to March 2020; millions of persons) 0.5  High skilled  Medium skill  Low skilled  Total employed  0.0  -0.5  -1.0  -1.5  -2.0 Jan-18  Apr-18  Jul-18  Oct-18  Jan-19  Apr-19  Jul-19  Oct-19  Jan-20  Apr-20  Jul-20  Oct-20  Jan-21  Apr-21  (1) According to the International Labor Organization (ILO), the skill level is measured by considering the following aspects: (i) nature of work performed in relation with characteristic tasks and duties (ii) formal education level necessary for competent performance of the job; and (iii) amount of informal training on the job and/or previous experience in related occupation that is required for competent performance of the job (2) Data in quarterly moving averages. Sources: National Statistics Institute (INE) and ILO.

MONETARY POLICY REPORT PRESENTATION BEFORE THE FINANCE COMMISSION OF THE HONORABLE SENATE OF THE REPUBLIC  Mario Marcel Governor Central Bank of Chile 9 June 2021    The June 2021 Monetary Policy Report can be found at http://www.bcentral.cl. I. Introduction  Madam President of the Finance Commission of the Senate, senator Ximena Rincón, Senators members of this Commission, ladies, gentlemen, I am grateful for your invitation to present the view of the Board of the Central Bank of Chile (CBC) on recent macroeconomic developments, their outlook, and implications for monetary policy. This view is contained in detail in the June 2021 Monetary Policy Report published this morning. This background provides the context for the decision adopted by the Board at yesterday’s Monetary Policy Meeting. The last few months have confirmed that the Chilean economy has been making progress in its recovery process. Activity figures brought positive surprises in the first months of 2021, reflecting the strong macroeconomic momentum and the better adaptation of the economy to the sanitary restrictions. In fact, the impact of the quarantines, despite involving almost 90 percent of the national population during April, was considerably milder than we expected and also less compared with figures early into the pandemic. Private consumption has risen strongly, fueled by the massive fiscal transfers that have been implemented in recent months and the pension savings withdrawals.
A second option to improve the Fed’s control over short-term rates is to drain reserves by offering banks term deposit accounts in which to invest funds for longer terms than overnight. There are two issues that might make this option somewhat less attractive. First, to strengthen monetary policy control significantly through this course, it might be necessary to drain most of the $ trillion of reserves. This could be done of course with effort, but is the effort worth it? Second, the Fed would undoubtedly have to “pay up” to induce banks to hold term deposit accounts relative to keeping their monies in reserves at the excess reserves interest rate. This would likely result in higher Fed interest expenses relative to relying on an overnight RRP facility to set a floor on money market rates. The choices here are important and I expect that considerable testing, analysis and discussion will be necessary to reach firm conclusions about the appropriate course. My goal would be to clarify our intentions later this year, long before we begin to contemplate raising short-term rates. I also think that the choices are about how to conduct monetary policy during the transitional phase, not about the long-term monetary policy framework. Longer term, the issue will be whether to return to the type of corridor system that was in place prior to the crisis or to instead to stay with the type of floor system that will likely be the type of regime that is in place as the balance sheet gradually normalizes.

To the extent that the overnight RRP rate were set very close or equal to the interest rate on excess reserves (IOER) without caps, then this might result in a large amount of disintermediation out of banks through money market funds and other financial intermediaries into the facility. This could encourage further development of the shadow banking system. If this were deemed undesirable, this would argue for a wider spread between the overnight RRP and the IOER in order to reduce the volume of flows into the facility. The second issue is the facility’s potential impact on financial stability. In particular, would such a facility make financial instability less likely? And, when financial stress did occur, would such a facility amplify or dampen financial strains? On the first point, it seems that such a facility would tend to make financial instability less likely. The overnight RRP facility allows us to make a short-term safe asset more widely available to a broad range of financial market participants. The provision of short-term safe assets by the official sector might crowd out the private creation of runnable money-like liquid assets. This might enhance financial stability by reducing the likelihood of a financial crisis. However, if a financial crisis were to occur, the existence of a full allotment, overnight, RRP facility might exacerbate instability by encouraging runs out of more risky assets into the facility. That is because the supply of a full allotment facility would be completely elastic at the given fixed rate.
What then is the role of central banks in this new financial landscape, where institutional investors and other nonbank financial institutions hold a larger share of assets and a larger share BIS Review 108/1998  –3–  of credit risk than they ever have before – and where an increasing share of conventional credit risk is intermediated through the capital markets? I would argue that the role of a central bank in this new environment is very much in keeping with its traditional responsibilities. Central banks in all countries fundamentally care about the flow of credit in their economies, whether this credit flows from banks, nonbank financial institutions, or institutional investors. Why is this so? The answer is simple. It is because the credit intermediation process is ultimately what determines how well our economies function and therefore how well our economies are able to grow and allow their citizens to prosper. When the credit intermediation process does not work well, when there are disruptions to the supply of credit to the economy, as history has amply shown, the costs for our businesses and our people can be enormous in terms of lower output and fewer jobs. A well-functioning credit intermediation process is, in short, critical to the sustainability of any economy’s success. It is for these reasons that central bankers are interested in the flows of credit from the global securities markets, just as we have needed to know about the flows of credit from the banks whose operations we are charged with overseeing.

On an average day, over $ billion in Treasury securities changes hands, about seven times the value of stocks traded daily on the New York Stock Exchange. All of this trading activity serves the very important function of price discovery. More than any other securities market in the United States, the Treasury market responds forcefully to new information about macroeconomic fundamentals. The days when the most intense trading activity takes place are also the days when major reports are released on such indicators of U.S. economic performance as the employment report, the consumer price index or the producer price index. These releases allow market participants to digest important new information and to review their expectations about where the economy is going. The interest rates on Treasury securities of varying maturities are the market’s most important signals about the U.S. economy’s prospects for growth and risks of inflation. In the rest of the fixed-income market, trading in corporate bonds, mortgage-backed securities and sovereign debt also serves the price discovery process. This trading activity acts to differentiate, for example, a triple-A risk against a triple-B risk, the prepayment risk of mortgages against the prepayment risk of credit card receivables, and OECD country risk against emerging market risk.
The approach must be comprehensive as macroprudential measures will not be effective if it is done in isolation. Since we operate in a dual financial system, all macroprudential measures are applicable to both the Islamic and conventional financial systems, as both have exposures in housing market and household debts. Second, the measures were targeted to minimise unintended cross-sectional spillovers Instead of a broad-based LTV ratio limit, we imposed the measure only on borrowers with three or more house financing to ensure a continued access to financing for eligible first time house buyers and those investing long-term in a second house for wealth diversification. In Malaysia, we have an on-line system called Central Credit Reference Information System or (CCRIS)) which allows us to have more granular data to monitor borrowers with multiple outstanding house financing. In other words, we have an on-line system where each citizen and companies having exposures in the banking system will have their data centralised in one particular database. That way we know at any point in time, the detail exposures of any companies and individuals. The other important point to note is that we did not narrow the application of measures to specific geographical locations and house type or price in order to avoid circumvention or abuse as developers and lenders can easily build or finance houses at the edge of a restricted zone or price range, or even create a new house type (e.g. Small Office Home Office (SOHO)).

The price of five-year futures contracts for West Texas Intermediate crude has almost doubled in the last three years. Following the sudden rise last spring, US capital market rates have since dropped back to the year-earlier level. The temporary increase in capital market rates in Europe was slightly less pronounced. As a result of the opposing movements of the US and European interest rates of the past few weeks, the long-term dollar interest rates now exceed the corresponding interest rates in the euro area by approximately 50 basis points. On the one hand, the general interest rate development in the capital markets reflects market participants’ misgivings concerning the strength of the economic upswing. On the other hand, the historically low nominal interest rates are testimony to the markets’ confidence in the ability and determination of central banks to further ensure price stability. Moreover, the interest rate structure in the US is characterised by the sizeable dollar investments from Asia. International equity markets trended sideways for much of the year, although some emerging market indices in particular were able to generate significant profits. 2. Managing the National Bank’s assets  The National Bank manages monetary reserves slightly in excess of CHF 60 billion, two-thirds of which are held in foreign currency investments and one-third in gold. In addition to this are approximately 25-30 billion Swiss franc assets in the form of balances from repo transactions in the  1/2  money market and bond investments in the domestic capital market.
This does not yet account for the losses relating to under-reported taxes which is directly enabled by a cash economy – a cost borne by society as a whole. A 2005 study estimated this figure to be USD100 billion annually in the United States alone The task of calculating the relative total cost of cash and cashless payments is a difficult one. Apart from the methodological challenges, the findings for each study are also likely to differ according to the nuances of each country. Nonetheless it is a worthwhile endeavour. Policy makers around the world have made positive progress in this area, and I believe we will see more efforts on this front in the coming years. This leads to another dimension of the social cost consideration, which is the impact on financial inclusion. Millions of people live in rural areas globally, with little or no access to the modern infrastructures necessary to facilitate cashless solutions. The availability of cash is therefore paramount in ensuring that they continue to be seamlessly included in the financial system. At the same time, the success of mobile payments operator M-Pesa in rural Kenya has demonstrated that cashless alternatives can in fact be a means to promote financial inclusion for the unbanked. Here in Malaysia, where mobile banking transactions have tripled in the past year, there is potential to leverage the high mobile penetration rate to improve financial inclusion. Stability The third element is stability.

Encik Abdul Rasheed Ghaffour: Optimal balance of paper and digital, cash and cashless; and next page for physical currency Welcoming address by Mr Encik Abdul Rasheed Ghaffour, Deputy Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Currency Conference 2017, Kuala Lumpur, 15 May 2017. * * * Mr Richard Haycock, Chairman, Currency Research, Fellow central bankers, Distinguished participants. A very good morning and a warm Selamat Datang to Malaysia. Paper lives on A lot has changed in the past 10 years. In May 2007, there was no such thing as a smartphone. Tablets did not exist, and the human race had not discovered the fast-expanding universe of mobile apps. Back then, we read the news by leafing through the pages of a large newspaper. We listened to music with CDs, and bought or rented DVDs to watch movies. Today, most of these are streamed through internet devices. When e-book sales increased by over 1,000% in the two years leading up to 2010, many questioned the future of the printed book. The bankruptcy of Borders in the United States the following year solidified these fears. Similarly, there has been much hype about the end of cash. This has been sparked by the rising use of e-payments and the recent proliferation of digital currencies in an increasingly virtual world. However, just as physical books continue to enjoy increasing sales, we have seen cash in circulation rise in many countries, quicker than their GDP growth for some.
The risk management role of helping identify, evaluate, monitor, manage and control or mitigate these risks has become a crucial role in modern-day banking. Indeed, it is probably not exaggerating the importance of this to say that the quality of a bank's risk management has become one of the key determinants of a success of a bank. Basel II recognises the importance of these risks - and of the quality of risk management - by means of what is known as "Pillar 2". Under Pillar 2, there is an assessment firstly of all the risks a bank is running and, secondly, of its ability to manage these risks. This can lead to the bank being required to hold more capital to cover these risks, or to make improvements in its risk management. Pillar 2 therefore encourages banks to improve risk management, and gives capital incentives to do so. 1/5  I will say some more about this later on, but it is probably time at this point that I said a little about how Hong Kong is implementing Basel II. Hong Kong implementation We took a strategic decision early on in the Basel II process that Hong Kong should implement Basel II in accordance with the timetable recommended by the Basel Committee of Banking Supervision for its own members. This means adoption of most of the approaches under the new framework from the start of 2007, and the more advanced approaches from the start of 2008.

To increase the chance that project developers can attract private funding, they need to enhance their communication with investors by understanding their risk concerns and speaking in their risk language. This is how we can make projects more bankable. On this front, IFFO has developed a reference term sheet for infrastructure investments in Emerging Markets together with key institutional investors last March. To further facilitate the use of this common language, IFFO has also rolled out a number of capacity building initiatives the past year for all partners. Fintech Apart from infrastructure financing, fintech counts as another most frequently discussed topics in industry events and international conferences in the past year. But like infrastructure financing, we are not just talking about it, we are also doing something about it. HKMA announced September this year a series of measures to facilitate the financial services industry to grasp the opportunities in fintech, covering financial infrastructure, regulatory sandbox, research and talent development, etc. I will leave this to my colleague, Shu-pui, to share more with you in the panel on fintech later this afternoon. But I wish to highlight one point, and that is, fintech is borderless. It requires collaboration among financial centres like Hong Kong and London. A fintech solution that works only in a particular jurisdiction is of little value to clients and financial institutions that are often located half-way across the globe.
In earlier remarks, I argued that in the vicinity of the effective lower bound, attempting to shorten the horizon by further easing financial conditions carries the risk of shifting the balance of the costs and benefits of a highly accommodative monetary policy stance by increasing potential side effects.6 At the current juncture, an important element in determining the appropriate length of the medium term is the risk of second-round effects that may entrench expectations of low inflation and thereby leave permanent scars on the euro area economy. However, this risk is mitigated by the emerging policy response in the euro area. For the first time, fiscal and monetary policy in the euro area are starting to act as true complements, thereby reinforcing each other’s effectiveness and paving the way for a sustainable recovery. Moreover, inflation expectations by households currently signal very limited risks of second-round effects. While financial markets currently price in significant risks of deflation over the next five years (see left chart on Slide 9), households have adjusted their expectations in response to the pandemic very differently: the share of people that expect inflation to increase more rapidly over the course of next year has increased markedly in April, from 20% to 36%, and in May still accounted for 32% (see right chart on Slide 9). So, given the already highly accommodative monetary policy stance, the growing complementarity between fiscal and monetary policy and the high uncertainty regarding secondround effects, our decision appears to be an appropriate and proportional course of action.

Our priority throughout this transition has been to ensure that it has been and continues to be managed in a way that promotes the robustness and resilience of the payment systems, and of wider financial stability. And a considerable amount of work was undertaken to achieve this - by the retail scheme operators, their participants and the NPSO. What we now expect to see: Tangible progress has been made, and this should rightly be recognised. But, as with any journey, we cannot lose sight of the work that lies ahead to deliver these benefits from consolidation. The NPSO’s primary focus should be on completing integration of the payment systems and embedding robustness and resilience within all of its activities, including the New Payments Architecture (NPA) programme. There is still much to do to complete the integration of these systems, from an organisational perspective, but also at the system level; completion of which will allow the NPSO to begin realising the ultimate goal of strategic leadership and higher standards of management and control. For this to succeed, the NPSO’s strategy will need to be realistic and consistent with its objectives and capabilities. It will also need to include an appropriate focus on reviewing and enhancing the activities the NPSO has inherited, to manage its own risk profile, its outsourced infrastructure partner, and risks to the wider system emanating from participants.
Since it is forwardlooking the central bank can at least try to foresee future problems or structural changes and meet them through a rate adjustment. The ability to act quickly is essential, as monetary policy acts with some lag and the economic cost of increasing inflation becomes lower if it is checked at an early stage. Another benefit is that the central bank does not become as tied as with a rule, but instead can take account of alternative scenarios and risks. Moreover, these assessments can be regularly updated in the light of new information about economic developments.2  1  This is known as the Taylor rule. The US economics professor John B. Taylor is Under Secretary for International Affairs at the US Department of the Treasury. He has formulated a simple rate-setting rule that has come to be known as the Taylor rule and that has become very popular. This is one of many examples of monetary policy rules. 2  See the speech by Federal Reserve Board Governor Ben S. Bernanke, "The Logic of Monetary Policy" (2004). In his speech Bernanke discusses advantages and disadvantages of following a simple monetary policy rule compared with a forecast-based policy. See also Apel, M., Nessén M., Söderström U.

Therefore, the CBT will not react to the first round effects of short-term volatility in commodity prices, especially when domestic resource utilization remains at depressed levels. However, if an uptrend in commodity prices coincides with a strong and durable rebound in global economic activity that would in turn have adverse effects on inflation expectations, then the CBT will tighten monetary policy appropriately to keep inflation in line with medium-term inflation targets. Since the last quarter of 2008, the CBT, without endangering its main objective of price stability, has focused on containing the adverse effects of the global crisis on domestic economy, and this task has to a large extent been achieved. Monetary policy will continue to focus on permanent price stability in the period ahead. Strengthening the commitment to fiscal discipline and the structural reform agenda would support the relative improvement in Turkey’s sovereign risk, and thus facilitate macroeconomic and price stability. In this respect, before concluding my remarks, I would like to underline once more that timely implementation of the structural reforms envisaged by the Medium Term Program and the European Union accession process remains to be of the utmost importance. Thank you for your attention. BIS Review 31/2010  17