samchain/econo-pairs-v1 huggingface dataset:
The index is currently about 6 percentage points above its average value over the period 1970–2014.4 As recently as 2009, it was around 2 percentage points below. The index has been above current levels in only 5 of the past 44 years. On this measure, the UK economy is in fine fettle. The current reading of the index chimes pretty well with survey measures of confidence, for both households and firms. Measures of business confidence picked up during 2013 and the first half of 2014 to reach series highs, while measures of consumer confidence rose above their long-run average levels at the start of 2014. Chart 2 constructs the same ecstasy index back to 1870. It suggests that, while current levels of the index are less unusual, they are edging up towards historic highs. In only 42 of the past 144 years has the index been above current levels. So far, then, so good. The UK economy appears to be healthier than on average in the past, if perhaps not quite yet ecstatic. Certainly, it appears to be firmly on the front foot. Reasons to be fearful In keeping with Thomas Carlyle’s stereotype, let me now add three flies to the ointment. These are features of the UK economy which paint a more sobering picture. In particular, let me offer three reasons to be fearful: •  Annual real wage growth in the UK – average weekly earnings growth adjusted for consumer price inflation – is currently running at close to minus 1%.

They have implemented broad-based development strategies to diversify their economies away from hydrocarbons and harness new growth drivers. While the energy-related sector will remain an important  BIS Review 84/2010  1  pillar in Asia-Middle East relations, we should develop other complementarities between the two regions such as in financial and business services, infocomm technology and media, infrastructure development, tourism as well as green technology and life sciences. 6. In this respect, the linkages between Singapore and the GCC have deepened. We have signed the milestone GCC-Singapore Free Trade Agreement (FTA). Singapore companies, such as Capital and in Bahrain and UAE, Changi Airport International in Saudi Arabia, Keppel Corp in Qatar and SembCorp in UAE and Oman, have secured about $ billion of projects in the GCC. In addition, a strong cluster of Middle Eastern banks, such as Arab Bank, Emirates NBD, First Gulf Bank, National Bank of Kuwait and Qatar National Bank, is already based in Singapore. Quite a few are looking to expand their operations in trade finance and wealth management to capitalize on new growth opportunities in the Asia-Pacific region. 7. By strengthening linkages at all levels, the Middle East and Asia can then complement each other’s development and seek out new growth areas for mutual benefit. Inter-regional platforms have been established to achieve this; for example, the Asia-Middle East Dialogue (AMED) and the ASEAN-GCC Ministerial Meeting, which was held in Singapore recently.
In the UK, for example, the banking sector had grown from around 100% of GDP to more than 500% of GDP in 2008. And the UK government had to inject 13 times more money into RBS than had been injected into Continental Illinois.6 Is too big to fail inevitable? The post-crisis period has seen a vast amount of work to come up with a better way to deal with a failed bank and a better answer than ‘the taxpayer’ to the question of ‘who pays?’ Some have argued that it cannot be done. The crisis, they argue, showed that large, complex banks do indeed have to keep operating. They are too interconnected and provide too large a share of essential services to the economy to be allowed to abruptly stop operating. This line of argument leads to the conclusion that if we want to end too big to fail, we need to end being big itself. We need to go back to a world of small, less complex banks. With the help of deposit insurance, these could be wound up quickly and simply without great disruption to the economy and society as a whole. A world of smaller, simple banks may appear tempting. But something important would I think be lost. As the Independent Commission on Banking argued in their Report, splitting up banks would reduce diversification benefits.7 While the cost of failure of small banks may be lower, these banks may hence be more likely to fail.

If an effective global resolution regime with clearly defined ex ante characteristics were to turn out to be a bridge too far, national authorities may have to fall back on a subsidiarization model, in which global firms would have to establish subsidiaries on a country-by-country basis each with their own capital and liquidity buffers. Such a regime would require greater capital and liquidity as the banks would lose the significant risk diversification benefits gained from operating in many different countries. Such a regime would also presumably make it more difficult for these firms to provide financial services seamlessly to multinational corporations, global asset managers, and others that operate on an international basis. Even in this scenario, however, it would be important to ensure that national resolution regimes could interact with each other in a coherent manner. To sum up, my view is that we live in a globalized world both with respect to the macro-economy and the financial system. But too often we set macroeconomic policy and regulatory policy at a national level, and miss important opportunities to coordinate and make the global economic and financial system stronger overall. We need to understand where greater global perspective is required and we need to apply that perspective consistently across jurisdictions in a timely manner. If we don’t do this, we won’t achieve all the benefits that are possible from global specialization and we will continue to run significant risks with respect to financial stability. Thank you for your kind attention. 4  BIS central bankers’ speeches
Mugur Isărescu: Regional economic outlook - Europe Opening speech by Mr Mugur Isărescu, Governor of the National Bank of Romania, at the conference "Regional Economic Outlook - Europe", Bucharest, 17 November 2017. * * * Your Excellences, Ambassadors, Members of the diplomatic corps, Ladies and gentlemen, Distinguished guests, It is my pleasure to welcome you to the National Bank of Romania. The Board and I are honored to host the presentation of an important IMF document, one of their flagship reports, namely “2017 Regional Economic Outlook Report”. It is a tradition for the National Bank of Romania to host this event and we are pleased to greet the presence of many foreign diplomats – this is a clear testimony of its importance. Allow me to extend a warm welcome to Mr. Jeffrey Franks, who has been a long-standing friend of Romania. Mr. Franks is a veteran of the Fund, who – over the last 25 years – has managed challenging assignments, including the resident offices in Ukraine and Ecuador, and has led teams in Pakistan, Romania, France, Belgium, and Paraguay. He was the IMF Mission Chief for Romania for almost 3 years, from 2009 till 2012. As many of you may remember, during his mandate as mission chief, Romania overcame a very difficult period, with the support of the IMF, WB and EC.

Øystein Olsen: Oil and the Norwegian economy – the challenges ahead Speech by Mr Øystein Olsen, Governor of the Norges Bank (Central Bank of Norway), at a lunch hosted by Danske Bank Markets, New York City, 27 March 2015. *  *  *  Accompanying slides can be found on the Norges Bank’s website: Slides (PDF). It’s a great pleasure to be in New York City again and an honour to be invited to give a lunch presentation here today. As Norges Bank, a week ago, published its latest monetary policy report, the economic outlook and the considerations behind the interest rate decision naturally warrant some attention in my speech today. First, however, I would like to give some background information on the economic policy framework in Norway, focusing on the sovereign wealth fund – the Government Pension Fund Global – the fiscal rule and Norges Bank’s foreign exchange transfers to the fund. Norway is a small, open, natural resource-rich economy. About a quarter of our GDP is related to oil and gas extraction, and a large share of our petroleum production is exported. The oil and gas industry has played a vital role for the strong growth in our economy over the past 40 years. When the first oil was brought to the surface in 1971, GDP per capita in Norway was lower than the average for a western economy. The picture has reversed since then. We have gradually caught up to the wealthiest nations.
The Bank of Zambia and the Government are, therefore, most grateful to our cooperating partners for helping us build capacity in our financial sector. Honourable Minister, it is also our view that the FSDP provides a unique opportunity through its structures, operating on the principle of private-public partnership, to take responsibility for overseeing the development of the financial education strategy for Zambia. One of the key issues that this partnership should help address is achieving consensus on resource requirements for implementing financial education programmes and agreeing suitable funding models that can generate a stream of resources to support sustained provision of financial education over the long-term. Ladies and Gentlemen, It is now my pleasure to call upon the Guest of Honour, to give us his key note address and to officially open this workshop. Honourable Minister Sir. 2  BIS Review 139/2010

On the one hand, global trade may continue to grow more rapidly than expected, thereby supporting euro area exports. Moreover, strong business confidence could provide more support to domestic economic activity in the euro area than is currently expected. On the other hand, downside risks relate to the tensions in some segments of the financial markets and their potential spillover to the euro area real economy. Further downside risks relate to renewed increases in oil and other commodity prices, protectionist pressures and the possibility of a disorderly correction of global imbalances. With regard to price developments, euro area annual HICP inflation was 2.4% in January 2011, according to Eurostat’s flash estimate, after 2.2% in December. This further increase was broadly anticipated and largely reflects higher energy prices. Looking ahead to the next  BIS central bankers’ speeches  1  few months, inflation rates could temporarily increase further and are likely to stay slightly above 2% for most of 2011, before moderating again around the turn of the year. Overall, we continue to see evidence of short-term upward pressure on overall inflation, mainly owing to energy and commodity prices. Such pressure is also discernible in the earlier stages of the production process. These developments have not so far affected our assessment that price developments will remain in line with price stability over the policy-relevant horizon. At the same time, very close monitoring is warranted.
The answer is that our balance sheet is what makes us special and gives us the economic policy tools we need to be able to do that. Our liabilities serve unique functions at the heart of the financial system: central bank money, whether in the form of bank notes or central bank “reserves” – the deposits held with us by financial institutions – provide the ultimate means of settlement for all sterling payments in the economy. And we are the sole institution with the power to create sterling central bank money. That power provides us with a wide range of tools that we can deploy in pursuit of our monetary and financial stability objectives (as summarised in Figure 1).   The importance of reserves to the financial system means that Bank Rate, the interest rate that we pay on firms’ reserve accounts, is the single most important interest rate in the UK. Changes in Bank Rate influence interest rates across the economy including those charged by commercial banks and those in financial markets. That in turn affects aggregate economic demand and ultimately inflation. So having reserves on our balance sheet gives us a powerful tool that we can use in support of monetary stability. Indeed in the years running up to the Great Financial crisis in 2007-08 this was the main monetary policy tool used by central banks – in Peter’s terminology, the “old normal” for policy.

QE and climate considerations  A second aspect of QE that has received close external scrutiny is its relationship to climate change. Responding to climate change is a strategic priority for the Bank; we continue to work towards promoting safety and soundness by enhancing the Prudential Regulation Authority (PRA)’s approach to supervising the financial risks from climate change, and towards enhancing the resilience of the UK financial system by supporting an orderly market transition to a low-carbon economy. In particular we have supported the Financial Stability Board’s work on climate disclosure through the Task Force on Climate-related Financial Disclosures (TCFD). To show its commitment last June the Bank published a report disclosing for the first time its own approach to climate risk management for all its operations.26  Attention, however, has understandably focused on the £ corporate bond purchases that form part (around 2%) of our QE programme, and whether more should be done to account for climate considerations in these holdings. Our approach to date has been to invest in sectors in proportion to the total outstanding eligible issuance accounted for by each sector in the UK economy.27 An important part of the design of the CBPS back in 2016 was to achieve the MPC’s aim of imparting monetary stimulus in a way that was sector-neutral, consistent with the remit given to the Committee by the Chancellor. As a result, the carbon footprint of the APF Corporate Bond Purchase Scheme (CBPS) portfolio is broadly representative of the sterling investment grade corporate bond market (Figure 7).
As Andrew  BIS central bankers’ speeches  1  noted, given the scale of the regulatory effort, that means that the business models pre-crisis are not necessarily going to be very effective now. Let me turn back to trust. Why is trust still so low? My sense from the discussions is that trust remains low for two reasons. First, because of misconduct, and secondly, because of a perceived – and, potentially, actual – lack of adequate client focus. The frequent references to misconduct reinforced in my mind the importance of individual accountability, the focus of the Fair and Effective Markets Review, chaired by Minouche Shafik. It also emphasised the importance of the senior managers’ regime coming into effect in the first quarter of next year, and the importance of applying it to true codes and standards in wholesale markets, in a manner that market practitioners understand. The people at coal-face – junior traders, investors and asset managers – must understand what a true market is and their responsibility to act in a way that is consistent with maintaining true markets. In terms of a perception of a lack of client focus, I took away two gaps that were raised. The first is a financing gap, which I felt came out during the first panel, and which some economic historians in the room compared to the ‘Macmillan gap’ – the distance between finance and industry being too great. People talk today about an excess of savings not finding a home.

As Elizabeth Corley highlighted, there is a disconnect between how we in finance – and I include the public sector here – see the sector and how the general public sees the sector. Interestingly, that disconnect is much less prompted by questions over the health of our banks. Alex Brummer made this same point in terms of a sense of optimism around institutions. That is a good thing because a tremendous amount has been done over the past seven years in order to make banks much stronger. I will not go into all the details, but banks are indeed now beginning to adjust their business models. I’ll add a very clear message on behalf of those of us on the regulatory side to the bankers in the room and those watching from outside: there is no Basel IV. There is no other big wave of capital regulation coming. With the agreement on Total Loss Absorbency Capacity, the last pieces of the puzzle have been put in place. It is true that we do have to make some adjustments to risk weights; and there will always be things to iron out, but I repeat there is no big other prudential regulatory wave for the banking sector. As Andrew Bailey made clear in one of the break-out sessions I attended, the focus now is about greater certainty and adjusting business models to these new realities.
♦ The path ‘consistent with the target’ which is announced in 5 December 2005 ‘’General Framework of Inflation Targeting Regime and Monetary and Exchange Rate Policy’ and constitutes the base for the principle of “accountability”. • 2006 end-year point target. ♦ The path consistent with the 2007 end-year target, under contemporary data set. The inflation forecasts given in Graph 25 were made under the base scenario developed on the basis of the assumptions and short-term outlook mentioned above, and the stance under which the Central Bank will progressively cut its policy interest rates in the forthcoming period. Accordingly, it is forecasted, in the light of current information, that inflation will be realized between the 4.8-6.4 percent at the end of 2006 and between the 2.9-5.4 percent at the end of the first nine months of 2007. In other words, according to the forecasts that have been produced within the framework of today’s data set, inflation will regain a downward course starting from the second quarter of the year. This tendency will become more apparent as of the third quarter and year-end inflation will be realized close to the target (Graph 25). The Graph also displays forecasts on the output gap that constitute the basis for the inflation forecast. Accordingly, the output gap will continue to remain negative throughout 2006. In other words, the contribution of overall demand and capacity conditions to the falling inflation process will continue in 2006 as well, albeit with a decline compared to the previous years.

As you can all see, a lot has happened over the past ten years. For instance, we can observe that:   The foreign currency reserve is SEK 325 billion larger. This increase is mainly because we have borrowed the equivalent of SEK 200 billion in foreign currency through the Swedish National Debt Office to strengthen the foreign currency reserve. The Riksbank’s balance sheet 2004 and 2014 SEK billion  Source: The Riksbanken  2  The formal term in the balance sheet is “lending to credit institutions in Sweden related to monetary policy operations denominated in Swedish kronor”. BIS central bankers’ speeches  3    We have once again acquired a securities portfolio in Swedish krona. The Riksbank previously had a portfolio of Swedish securities but then this was phased out more than ten years ago.   The stock of notes and coins has declined, partly due to card payments and electronic payments becoming more common. As a consequence of this, we now have monetary policy liabilities instead of a monetary policy claim. This means that we are now borrowing excess liquidity from the banking system instead of lending money to cover a liquidity deficit. I will return to this issue later on.
Starting with the history of money to the production of euro banknotes and on to the security features and the educational games in the Kids’ Corner, all visitors will definitely find useful information displayed in an attractive manner. For the NBR, the Euro Exhibition is yet another opportunity to strengthen our external communication activities, to get closer to the public at large and to open the doors of our institution in a special context: consolidating the steps towards full integration in Europe. Let me end by thanking all of you here today. I now give the floor to Mr. José Manuel González-Páramo to share with us his thoughts about the exhibition. 2  BIS central bankers’ speeches

Liquidity is lent against sufficient collateral and is subject to an interest rate that is higher than the policy rate. 2/4  BIS - Central bankers' speeches  SNB's contribution to managing Credit Suisse crisis This brings me to Credit Suisse. Credit Suisse has long struggled to cope with a loss of confidence and with outflows of client funds. The collapse of Silicon Valley Bank in the US triggered a swift deterioration of the situation in mid-March, despite the fact that there was no direct link between the bank in California and Credit Suisse. Credit Suisse's counterparties cut credit limits and clients withdrew deposits at a rapid rate. If Credit Suisse had collapsed, many Swiss households and SMEs would no longer have had access to their deposits, and payments via Credit Suisse would no longer have been executed. Furthermore, SMEs in particular would no longer have been able to benefit from existing credit limits at Credit Suisse and maturing loans would not have been renewed. The economic fallout would have been enormous. But there was even more at stake here. The collapse of Credit Suisse would have sent a shockwave through the global financial system. The consequences for the real economy, both in Switzerland and abroad, would have been dramatic. This extremely demanding situation required quick and decisive action. The federal government, FINMA and the SNB worked together under high-pressure conditions to find a solution that was viable and as market-based as possible in order to safeguard financial stability and protect the Swiss economy.