samchain/econo-pairs-v1 huggingface dataset:
On one hand, because of higher exposure both to those sectors more closely linked to the business cycle and to individual debtors who, faced with a deterioration of macroeconomic conditions could be severely affected. On the other hand, because of the higher relative growth of rollover consumer credit (i.e., credit cards and credit lines). This, because of the possible underestimation of the risk that these products may cause, as they allow for sharp increases in borrowing that may affect repayment ability without a timely reflection in the borrower’s payment behavior. Finally, and as has been noted before, the greater reliance of some midsized banks to wholesale funding makes them more vulnerable to episodes of greater difficulties in bank lending. As already noted, the present scenario depicts significant risks that call for policy responses in different directions. The MPR is within the range of values considered neutral. However, from the policy makers’ perspective, the task of dealing with the challenges posed by this type of risks goes beyond the scope of monetary policy, and requires the concurrence and coordination of a broader set of macroeconomic and financial policies. Actually, some of these risks (e.g., those relating to the current account deficit and the just mentioned real estate sector) can be observed even in a situation where inflation remains bounded and in line with the target. At the international level, we have seen growing interest in the use of macroprudential measures.

Table 3 Growth in housing prices (1) (real annual growth, percentage) 2002-2007  2009-2T2012  Nation-wide total (2)  3.1  5.7  Average of districts with significant increases (3)  1.6  8.3  (1) Averaged y-o-y growth between first quarter of initial year and last quarter of final year in each case. (2) Obtained using stratified method. (3) Average of districts with structural growth breakdown, according to methodology of Ferreira and Gyourko (2011). Source: Central Bank of Chile based on Internal Revenue Service (SII) data. BIS central bankers’ speeches  11  Figure 6 Housing sales by building phase (percentage of total) 100  100  80  80  60  60  40  40  20  20  0  0 08  09 Completed  10 Finishes  11  12  Structural work  Other unfinished  Source: Cámara Chilena de la Construcción. Figure 7 Mortgage debt to collateral ratio (*) (percentage) 90  90  85  85  80  80  75  75  70  70  65  65 07  08  09  10  11  12  (*) Preliminary figures of new operations approved in respective quarter. Source: Superintendence of Banks & Financial Institutions (SBIF).
We would not have it any other way, because the advantages of openness far outweigh the disadvantages. But the risks involved in this exposure were brought home to us by the Asian financial crisis. 20. For Hong Kong, the consequences of that crisis have been first a sharp recession, and secondly the series of attacks on our currency which I have already described. At the height of these attacks, during the summer of 1998, there was clear evidence that the free market in Hong Kong was in danger of failing to fulfil its functions. Specifically, the currency, securities and futures markets were being distorted to the point where efficient resource allocation had given way to manipulative speculation; where prices in the markets were no longer being determined by changes in underlying supply and demand; and where interest rates, instead of reflecting the supply and demand of liquidity, were being hijacked for the purpose of engineering dramatic changes in the markets. Strong evidence suggests that at the time a very small group of players were responsible for a preponderant proportion of the short futures contracts open at that time. We also estimate that currency borrowings to the tune of $ billion, arranged in advance to avoid the expected interest rate volatility they were hoping to generate in Hong Kong, had been made by a similarly small group of players to be quickly dumped at a time when the markets were most vulnerable.

Thirachai Phuvanatnaranubala: Prospects for the Thai economy Speech by Mr Thirachai Phuvanatnaranubala, Deputy Governor of the Bank of Thailand, at the German-Thai Chamber of Commerce Annual Meeting, Bangkok, 18 February 2003. *  *  *  Ambassador Andreas von Stechow , Distinguished guests, Ladies and gentlemen, It is a pleasure for me to be here. My task today is to assure you, as one of our most important groups of foreign investors, that the Thai economy is doing well. And for this year my task is quite easy. 2002 was a good year for the Thai economy. Despite much uncertainty in the global conditions, the Thai economy made a robust recovery with stability, both on the internal and external fronts. You may recall that 2 years after the crisis, we started to have positive growth in 1999. GDP growth rates for 1999 and 2000 were strong at 4.4 and 4.6%. But the year after that, in 2001, the global downturn adversely affected our export and made growth for 2001 dip to 1.9%. However, we recovered in 2002 when growth for the first three quarters climbed back up to 4.9%. For the final quarter, our initial estimate is just over 5%, which would result in growth for 2002 the whole year at 5% as well. This is a good performance in the midst of slow growth in many parts of the world. So what has caused this? First, there was an export recovery. Export contracted as much as -7% in 2001.
2017, a turnaround year At this same time last year, I made the paradoxical wish that the euro area, despite all its electoral uncertainties would be "an area of relative stability". 2017 was supposed to be a year full of dangers in Europe; and yet, our continent, and France above all, has proven to be a beacon of hope and strong growth, whereas the United States has abdicated from its leadership role. Two figures illustrate this: that of GDP growth, which greatly exceeded forecasts in 2017 – it is expected to reach 1.9% in France according to our latest forecasts, with notably 280,000 net job creations, and 2.4% in the euro area, which is the highest rate since 2010; the other key factor is confidence, reflected notably by the confidence in the euro, 74% of euro area citizens – the highest figure since the outset –, 71% of French citizens, and as many as 81% of German citizens claim that they are attached to our single currency. The second positive element in 2017: the acceleration of reforms in France. This acceleration of reforms has changed the image of France in the eyes of Europe and the world, which is extremely positive. Lastly, in 2017 Basel III was finalised. Bankers – largely represented this evening – had expressed, alongside others, serious concerns. The agreement of 7 December 2017 is the best possible agreement for our country and for Europe, thanks to the particularly active commitment of French negotiators.

And because now is the time to strengthen our economic instruments in order to deal with a future European recession, the day it comes. Otherwise monetary policy may be overburdened. My second wish concerns our country. The French economy is in much better shape, but there are still major drags on growth. At around 1.9%, we are above our potential growth rate, which means that we are coming up against more structural limiters. There are at least two indications of this: a persistent negative growth differential vis-à-vis the euro area of around half a percentage point, and a current account deficit and hence a lack of competitiveness. In order to increase the speed of the French economy, we need to boost the power of the engine: reforms, including those underway, are therefore necessary. And, beyond bureaucratic barriers or corporate interests, the greatest priority is to reform vocational training and apprenticeships: we cannot remain in a situation where we have almost 3 million unemployed, of whom 600,000 are young people, and companies cannot recruit the skills they need. I hear this everywhere from the entrepreneurs who participate in the advisory boards of the Banque de France, from Besançon to Châteauroux last week. According to INSEE, hiring difficulties have been the main obstacle to corporate activity. My third wish is for financing. Often, the Governor of the Banque de France encourages banks to lend more; this is not the case at present! Bank lending in France is very buoyant.
Something clearly has to give here – investors know – and must remember – that there is no such thing as a free lunch, and that additional return involves additional risk. The  BIS central bankers’ speeches  9  macro-prudential concern is that the reach for yield encourages financial innovation and growth in some parts of the financial system where the risks are not well understood,10 especially if it leads to greater interconnectedness within the banking system. This is one area which is likely to warrant further attention and analysis by the FPC in due course. Financial innovation and the emergence/growth of new products The financial industry is characterised by its tendency to innovate, continuously designing and offering new financial products to its customers. In my view, financial innovation should be seen as a “good thing” in normal circumstances. It can lead to a more efficient allocation of capital and a reduction in the costs of financial intermediation, both of which should help sustain real economic growth. For example, the rapid growth of electronic trade execution in the foreign exchange market has increased the speed and ease with which trades can be conducted. That should ultimately make international trade cheaper, bringing with it the associated benefits. Improvements in technology can, by facilitating wider market access, also lead to improved price discovery and market liquidity. Moreover, innovation can help issuers align the risk characteristics of new products more closely to those that investors demand.

Chart 2  Chart 3  Advanced economy corporate bond spreads(a)  Implied volatilities in selected markets(a)(b)  Basis Points 1000 Non-investment grade 900 corporates (RHS) 800 Investment grade 700 corporates (LHS) 600  Basis Points 2500  2000  1500  500 400  1000  300 200  500  100 0 2005 2006 2007 2008 2009 2010 2011  0  Sources: Bank of America/Merrill Lynch. (a) Option-adjusted spreads over government bond yields. Sources: Bloomberg, British Bankers’ Association, Chicago Mercantile Exchange, Euronext.liffe, JPMorgan Chase & Co. and Bank calculations. (a) Three-month option-implied volatilities. (b) Data to close of business on 14 June 2011. (c) WTI crude oil. (d) Average of FTSE 100, S&P 500 and Euro Stoxx 50. (e) Average of five-year on-the-run iTraxx Europe main and CDX North America investment-grade. (f) Average USD/GBP. of  USD/EUR,  EUR/GBP  and  (g) Average of three-month short sterling, eurodollar and Euribor. BIS central bankers’ speeches  3  Chart 4  Chart 5  Bid-ask spreads on selected assets(a)(b)(c)  International equity prices(a)  Corporate bonds  Indices: 2 January 2007 = 100 120  Indices: January 2005 = 100 1400  Government bonds Equities (d)  110  1200  100  1000  90  Commodities Currencies Interest rate swaps  80  800  70  600  Euro Stoxx 60  FTSE All-share  400  S&P 500  0 2005 2006 2007 2008 2009 2010 2011  Sources: Bloomberg, calculations.
32  All speeches are available online at www.bankofengland.co.uk/speeches  32  Chart 10: Trust in institutions in the UK NGOs Business Government Media  Chart 11: Trust in professions in the UK Net percentage balances  Per cent -100 60  -50  0  50  100  Nurses Doctors  50  Your own GP Historians  40  Scientists 30  Sports commentators Weather forecasters  20  Nutritionists Civil servants  10  Economists Your local MP  0 2011  2012  2013  2014  2015  2016  2017 Q1  Source: 2017 Q1 Edelman Trust Barometer. Politicians  Source: YouGov, February 2017. Notes: Years refer to the date on which survey fieldwork commenced. Chart 12: Trust/confidence/satisfaction with central banks US Federal Reserve Bank of England ECB Bank of Japan  Net percentage balances 60 50 40 30 20 10 0 -10 -20  1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Sources: Bank of England, Eurobarometer, Gallup, Bank of Japan Notes: The US Federal Reserve line shows a Gallup poll of confidence in the economic leadership of the US, the ECB line shows a Eurobarometer measure of trust in the ECB, the BoJ line shows an opinion survey of confidence in the Bank of Japan and the BoE line shows TNS Survey results on satisfaction with the Bank’s performance.

Without clearly explaining the goals of reforms to the people, policymakers put at risk the necessary support for changes. This is a very challenging and long-term task as it is easier to get people out of communism than communism out of people. This problem is nothing new in history. It is not without good reason that it took Moses forty years to bring his people from slavery in Egypt to the promised land (simply to replace the entire generation), a trip that could be completed in weeks (Hillman, 1999). It is therefore our duty to make the journey in the transition desert as short as possible. 4. Summing up  Transition has been a tremendous and exciting project in the last ten years, as well as an invaluable experience for all of us who took part in it in one way or another. Out of it we have learned a lot, not only about how economic systems function or how to initiate economic changes, but we have learned about human nature as well. So, let us keep in mind that the transition process is done for the people and by the people. They happen at the same time: the main objective of transition (we have to increase their welfare), the main engine of transition (through human and social capital) and the main constraint to more rapid transition (rent-seeking behaviour and lack of political support).
Maja Kadievska-Vojnovik: Fintech and digital transformation "Regulating an anonymous world" Platform for discussion by Ms Maja Kadievska-Vojnovik, Vice-Governor of the National Bank of the Republic of Macedonia, at the xCEEd Conference on Fintex, Belgrade, 22-23 May 2018. * * *  FinTech Sector – General trends, current state in Macedonia, main challenges and risks and impact on central banks’ activity FinTech is one of the fastest-growing sectors in the global financial services industry nowadays with total global venture investment in FinTech companies reaching high of $ billion in 2016(KPMG, 2016).The highest number of FinTech service providers is in the payments, clearing and settlement category, followed by credit, deposit and capital-raising services (Basel Committee on the Banking Supervision Survey, 2016). Research in the area (ATKearney & EFMA, 2013) points to several factors that define readiness for digitization in the banking sector such as: 1) the capacity of banks for innovation; 2) the stage of technological development where the country is located; 3) the level of competition in the sector; 4) culture of consumption; 5) demographic structure of the population; 6) degree of concentration in the banking sector; and 7) the existing regulation, which can promote or constrain emergence of new technological solutions.

Nevertheless, none of the current initiatives to update or replace existing wholesale payment systems are considering the adoption of DLT. The ECB and the BOJ, in their role as operators of important market infrastructures services, decided to conduct in-depth experiments to determine whether specific existing functionalities of their respective payment systems could run in a DLT environment. Findings in relation to efficiency show that, with regard to the specific aspects of RTGS services tested to date, a DLTbased solution could meet the performance needs of current large value payment systems. In conclusion, this joint effort of ECB and the BOJ has produced a thorough set of results that provide reasons to be optimistic with respect to the capabilities of DLT within payment systems. It is, however, important to bear in mind that this work has been conducted in a test environment; therefore, any assumptions regarding the capacity for DLT to be used in production should not be made from this report. Both, the Bank of England (2017) and Bank of Canada (Ho, 2017)) conclude that DLT is not yet mature enough for current adoption. Yet most central banks that are considering modernizing their core payment infrastructure stress the need to make new systems inter-operable with future DLT platforms. Looking beyond the immediate horizon, many industry participants see significant potential for DLT to increase efficiency and reduce reconciliation costs in securities clearing and settlement.
Villy Bergström: Monetary policy and economic stability Speech by Mr Villy Bergström, Deputy Governor of Sveriges Riksbank, at a conference organised by the real-estate market magazine “Fastighetsvärlden”, Stockholm 12 May 2004. *  *  *  Thank you for the invitation to participate in Fastighetsdagen 2004 here at Grand Hotel. The property sector is an interest rate-sensitive component of the economy, and it is therefore interesting for me in my capacity as a member of the Riksbank’s Executive Board to come here and speak with you and discuss how the Riksbank views the current economic situation. The current economic situation In conjunction with the publication of the year’s first Inflation Report on 1 April the Riksbank cut its key interest rate, the repo rate, by a half percentage point. The reason was that the Executive Board judged that inflation would be below the target of 2 per cent inflation over the next two years. In the past year inflation has been low, averaging 1.3 per cent. This is attributable to a large extent to an adjustment of energy prices to more normal levels. But recently the drop in inflation has been sharper than expected and the Riksbank has gradually changed its view of inflationary pressures. Among other things this has been due to unexpectedly low import prices. The labour market has also been weaker than forecast and productivity has increased faster, resulting in lower domestic wage and price pressures.

It is this cost-benefit calculus that both motivates a role for macro-prudential policy, and helps us define precisely what we mean by it. In short, macro-prudential policy aims to improve the trade-off between the financial system’s contribution to the rewards expected in a growing economy and the degree of risk that we will face in the bad times. To return to my analogy, we might liken it to the NHS and to health insurance where we pay a bit in the good times to protect ourselves should our health take a turn for the worse. Principles of good policy making Macro-prudential authorities, like the UK’s FPC, work to ensure that financial systems are resilient to, and prepared for, the wide range of possible shocks they could face. Their aim is to ensure that when shocks occur, the financial system is able to absorb those shocks, rather than to amplify their impact on the economy. We ground what we do in two elements of good macro-prudential policymaking:  Macro-prudential policy should be targeted to provide a net benefit to the overall 3/7  BIS central bankers' speeches  economy. Where interventions incur costs, these should only be imposed when they are outweighed by the benefits over the full cycle. This is perhaps equivalent to starting a course of new medication, where a good doctor must be aware of potential side effects as well as intended benefits.
Structural separation then provides authorities with additional options as part of any subsequent restructuring. Ring-fencing, together with other elements of the post-crisis regulatory landscape, means that the key providers of important retail banking services are less likely to fail following a shock to the economy or the 2 3  See Bank of England (2018), Financial Stability Report, June, page 44. See Bank of England (2016), The FPC’s framework for the systemic risk buffer, May, Box 2. 3  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  3  financial system. But if banks do get into trouble, there will be greater certainty that important banking services will continue to be provided without disrupting customers and without the need for Government bail-outs. This is the key difference ring-fencing delivers should we experience a repeat of the financial crisis. What changes are happening? To comply with the legislation, each banking group has had to restructure to ensure that their new ring-fenced banks can meet prudential requirements on a standalone basis, have their own governance arrangements and have viable business models. In some cases, a banking group’s ring-fenced bank has been established as a brand new legal entity. Setting up a bank from scratch is a considerable undertaking, even more so for a bank which will have millions of customers from day one. In fact, last year the PRA authorised the three largest new banks ever established in the UK.

Weak external demand is a significant constraint on economic growth. Moreover, the momentum for the recovery in the global economy may be waning now. As a result of this heterogeneity, there may be significant differences in price dynamics in different industries and regions, both now and in future. This trend is clearly demonstrated by data on consumer inflation in summer. The return to potential in different product markets may occur at a different pace. For instance, in industries focused on domestic demand, this may be a faster process than in export industries; the recovery of the consumer-facing sector may be quicker than in the production of investment goods. Therefore, it is essential to consider not only the general output gap in the economy, that is, the deviation of output from its potential, but also the situation 2/3  BIS central bankers' speeches  in individual sectors. If output in industries focused on domestic demand returns to its potential faster than generally across the economy, this will amplify overall inflationary pressure. We take this into account when analysing the economic situation and making key rate decisions. At present, the effects of deferred domestic demand have been considerably implemented and the overall recovery of the Russian economy is likely to continue at a more moderate pace. This year, both fiscal and monetary policies are contributing to the economic recovery.