samchain/econo-pairs-v1 huggingface dataset:
Christian Noyer: The euro, a stabilising factor at home and abroad Speech by Mr Christian Noyer, Governor of the Bank of France, at “Paris Europlace" a financial meeting in Hong Kong, 21 March 2005. *  *  *  Introduction •  The legal basis for the single monetary policy is the Treaty on the European Community, whose Article 105 states that “the primary objective of the European System of Central Banks shall be to maintain price stability”. •  Price stability, combined with the convergence of euro area economies, is the key issue enabling the euro to become a stable international currency. •  Thanks to a strong macroeconomic framework and to the convergence of euro area economies, the introduction of the euro has limited the risks of disequilibrium inside the euro area (Part 1). Furthermore, the international role of the euro as a vector of stability has increased (Part 2). Part 1: The euro has been a key factor for maintaining stability inside the euro area The efficient macroeconomic framework of the euro area (A) has made the economies of the euro area more homogeneous and reduced the risks of macroeconomic disequilibrium (B). As a result, the euro area is characterized by strong economic fundamentals (C). A  The macroeconomic framework of the euro area is an efficient framework  •  For the past six years, the Eurosystem has been responsible for defining and implementing the single monetary policy.

The EMU has limited the risks of exchange rate crises and catalyzed the financial integration of the euro area economy •  The euro has put an end to the potential effects of exchange rate crises and favoured the emergence of a stable environment characterized by historically low interest rates. Thanks to these developments, the euro area countries have not been confronted with difficulties stemming from the uncertainties due to recent geopolitical troubles. •  The introduction of the euro has catalyzed the financial integration of the European economy, which is totally complete as regards the money market. In the first weeks following the introduction of the euro, price differences on national interbank money markets decreased very quickly to stand at less than 5 bp. This level corresponds to the spread bid-ask currently observed on the market. •  A comparable movement has occurred on European bond markets, where returns on government yields have converged. •  The euro area, and more broadly the European Union, now have a consistent financial architecture. The implementation of the Financial Services Action Plan defined at the Lisbon European Council is on the way to completion. Subsequently, the Lamfalussy process should provide a new institutional architecture in the fields of financial supervision and regulation and develop flexible and uniform technical rules. Part 2: The euro plays the role of an international currency and a nominal anchor The available data bear out the increase in the international role of the euro.
In addition, the conference features two keynote speeches that address some of the most important issues facing central banks: monetary-fiscal interactions and the macroeconomics of climate change. Under normal conditions, the informal discussions at these annual conferences provide a useful opportunity to increase external awareness of the monetary policy research conducted at the ECB and across the Eurosystem. Since such informal interactions cannot be reproduced in webinar format, I will take this opportunity to highlight the extraordinary research efforts of the ECB and Eurosystem staff in supporting our recent monetary policy strategy review. In particular, eighteen ECB occasional papers were released on 21 September. These papers provide not only a superb series of surveys of the state of research on a given topic but also report many substantive new research findings: I believe that these occasional papers lay important foundations for many research programmes in academia and in central banks for years to come. The research reported in these papers shaped our new monetary policy strategy. In particular, a central theme of the review was to work out the implications of the trend decline in the equilibrium real interest rate and the associated implications of the effective lower bound for the conduct of monetary policy. One basic conclusion of the review is that it is essential to build a sufficient medium-term inflation buffer (as captured by the symmetric two per cent inflation target) to create the monetary policy space required to be effective in tackling negative shocks.

Philip R Lane: The monetary policy toolbox and the effective lower bound Welcome address by Mr Philip R Lane, Member of the Executive Board of the European Central Bank, at the ECB Conference on Monetary Policy “bridging science and practice”, Frankfurt am Main, 11 October 2021. * * * It is a pleasure to welcome you to the 2021 edition of the annual ECB Conference on Monetary Policy. As captured in the title of this year’s event, this conference series serves a vital role in bridging the science and practice of monetary policy. In particular, it is essential for the ECB to incorporate in our analytical framework the theoretical and empirical insights generated by the global academic community, and the conference format (albeit in webinar mode again this year) is very effective in providing us with a platform to discuss the latest developments. The breadth of academic research (in terms of both topics and research techniques) that is relevant for monetary policy is quite wide and this is reflected in the composition of the conference programme. The agenda includes research that exploits financial market data to examine the transmission of monetary policy, studies the impact of the pandemic on firms and banks using entity-level datasets, analyses the interactions between monetary policy and financial stability in a full-scale macroeconomic model, and explores the impact of monetary and fiscal policies on the formation of household expectations.
Finally, an important dimension of flexibility in our monetary policy that we should not overlook is the focus on avoiding financial fragmentation in the euro area, in particular when the impact of the pandemic has been and remains very heterogeneous across countries and sectors. In December last year, we decided to retain this flexibility in the PEPP reinvestment phase, which was extended until the end of 2024. We should now use this  13  flexibility proactively and monitor whether it is sufficient to ensure our monetary policy is appropriately transmitted across the euro area. 4 Conclusions Let me conclude. I am convinced that the ECB’s new monetary policy strategy, which I have briefly sketched in this talk, constitutes a solid basis for the conduct of our monetary policy. This is so, not just looking ahead to the coming decades, but also for coping with the current high-inflation episode. In this respect, I believe that, in a highly uncertain environment, a careful assessment of the implications that current developments have on medium-term inflation expectations is key, and that the optionality and flexibility that we retain should be exercised gradually and predictably. The direction in which we need to head is clear, but we should not draw premature conclusions as to the time frame. The process will be both gradual and data-dependent. Thank you for your attention. 14  References Ajevskis, V. (2018), "The Natural Rate of Interest: Information Derived from a Shadow Rate Model," Working Papers 2018/02, Latvijas Banka.

Against this background, the fact that inflation in the euro area remained persistently below the ECB’s target level during the period that ran between the global financial crisis and 2020 made clear that a comprehensive review of our monetary policy strategy (which was last revised in 2003) was appropriate. 2  To understand why inflation in the euro area remained below target for more than a decade, despite the fact that the ECB maintained a rather accommodative monetary policy stance, one must necessarily take into account the secular decline in the natural interest rate and the limitations that such a decline imposes, through the interest rate lower bound, on the conduct of monetary policy. The equilibrium or natural interest rate (r*) is defined as the real interest rate that simultaneously maintains output at its potential level and inflation stable at its target level. This rate, which cannot be observed directly, can only be estimated, with some degree of uncertainty, using econometric techniques. According to available estimates, the natural interest rate appears to have progressively declined in recent decades in advanced economies and, in the case of the euro area, estimates even place it at negative levels.1 This secular drop in r* is attributed, among other factors, to the decline in trend productivity growth, certain demographic developments and widening inequality. All of these are factors that will have changed the balance between the supply of savings and the demand for investment. And, why is this important for monetary policy? Well, the answer is clear.
But we were all then hit by new shocks to the world economy. Russian default, followed by the near collapse of a highly-geared US hedge fund, led to a flight of investment into only the most secure and highly liquid assets, threatening not only a new round of financial crises in the emerging markets of Asia, Latin America and elsewhere, but also, for the first time, a credit crunch in major industrial economies, most notably in the US. Meanwhile the Japanese economy remained independently mired in recession. BIS Review 56/1999  2  By the time of the annual IMF meetings in Washington last October the public atmosphere was close to panic and the media noise was of impending world recession. Business confidence slumped pretty well everywhere, and so too in this country did consumer confidence. We were faced in the Monetary Policy Committee with a situation in which the overall economic slowdown which we had been seeking to engineer, in order to prevent accelerating inflation, threatened to become an unnecessary economic downturn likely to produce an unwanted fall in the rate of inflation to significantly below the Government’s 2½% inflation target.

But, one thing I would flag is that, on my read, recent fiscal announcements will, on balance, provide a stimulus to demand relative to supply in the short to medium term. We will come to our more complete assessment in November. But I recognise that, as of today, November might seem a long time away. For algorithmic traders, even nanoseconds can represent a long time. The media or political cycle operates over a matter of hours. And, as we saw yesterday, acting to sustain orderly markets may also require action at short order. But monetary policy needs to be framed on a more considered or lower frequency basis, reflecting both the famously ‘long and variable lags’ in the transmission of monetary policy to price developments, as well as the need to distinguish signal from noise in the flow of incoming data and analysis. So the following question arises: if we need to wait for November for our comprehensive assessment, what happens in the meantime? Page 6  During the intervening period, we need to rely on our communication about the economic and policy outlook through remarks like these, and its transmission to market developments, the real economy and wage and price setting behaviour, via market participants’ expectations. That process, in turn, relies on the underlying macro and market institutional framework. Essential to maintaining a credible and stable institutional framework within which the Bank’s monetary policy can operate effectively are: clearly defined responsibilities; clearly identified objectives; and respect for institutional independence.
Although the financial sector has made significant progress in terms of cyber resilience, the never-ending development of cyber threats means that we too must continue to improve our defenses. In this regard, there remains many issues which the Bank of Thailand, along with other central banks in the region, intend to drive forward, such as overseeing more comprehensive cyber resilience policies and promoting the development of human resources. In response to cyber-attacks that may target vulnerable customers, it is crucial that we strive to increase consumer technology literacy to nudge them towards safer cyber behaviors and ensure a sufficient level of Cyber Hygiene. Ladies and gentlemen, I would like to take this opportunity to thank the Thai Bankers’ Association and TB-CERT for organizing “ASEAN Banking Cybersecurity Conference 2019” which has brought our ASEAN members together today. This is an opportunity not only to gain knowledge from expertise in different areas, but also to enhance connectivity and collaboration among professionals which is vital to improve our Cyber Resilience going forward. I wish all of you a fruitful conference and an enjoyable stay in Bangkok. Thank you. 4

Zeti Akhtar Aziz: Focus on human capital development in Malaysia Welcoming remarks by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the INCEIF Strategic Partnership 2006, Kuala Lumpur, 14 December 2006. *  *  *  Yang Berhormat, Dato' Mustapa Mohamed, Minister of Higher Education, Distinguished Guests, Ladies and Gentlemen, It is my great pleasure and honour to welcome you to INCEIF Strategic Partnership in conjunction with the signing of Memorandum of Understanding between INCEIF and nine institutions of higher learning in Malaysia. This occasion is of particular significance as, on this day, with the grace of Allah, we are laying the foundation for the promotion of collaborative efforts in human capital development which will benefit the Islamic financial services industry. Against an environment of a rapidly evolving Islamic financial industry and the growing significance of Islamic financial institutions globally, human intellectual capital has become the defining factor in sustaining the performance and competitiveness of the Islamic financial industry. Indeed, the fast pace of innovation in global financial services in general and in the Islamic financial services sector in particular, demands new expertise and skills. In this environment, the creation of a substantial pool of talent is indispensable for the future growth of Islamic finance. In this regard, Malaysia has placed strong focus on human capital development through training and education.
With a zero interest rate, households, firms and authorities become indifferent about the choice of whether to hold securities such as treasury bills and bonds or to hold cash. 2 A so-called open market operation in which the central bank increases the monetary base and thus liquidity by buying treasury bills and bonds and paying with cash, then becomes ineffective in the sense that the interest rate is still zero and the only thing that happens is that households, firms and authorities hold more cash and fewer Treasury bills and bonds. A situation with a zero interest rate is therefore also called a liquidity trap. The issue of monetary policy when the interest rate is zero has become topical again. Since the autumn of last year, the outlook for the global economy has deteriorated further. At the same time as forecasts for inflation and growth have been revised downwards, policy rates  1  For more information on these measures, see www.riksbank.se. 2  This applies when the amount of cash held does not fall below the level needed for transaction purposes. BIS Review 19/2009  1  have been lowered and are now approaching zero in several countries. In December last year, the Federal Reserve, for example, cut its policy rate to an interval between 0–0.25 per cent, while in Japan the policy rate is 0.1 per cent and in Switzerland 0.5 per cent. Inflation throughout the world is also falling rapidly.

The second issue is how independence should a Central Bank be? I believe that a Central Bank should be independent within the government because it is the Minister of Finance who has to be accountable to the parliament on issues relating to macro economic, fiscal, monetary and financial system matters. I agree absolutely with Governor Paul Acquah that monetary and fiscal policies must be harmonized in order to achieve macro stability, meaning that a Minister of Finance and a Governor of a Central Bank must work hand in hand to achieve a proper policy mix of fiscal and monetary policies so that sustainable growth can be achieved. BIS Review 53/2002  3  Ladies and gentlemen, I feel that I have taken enough of your time already. Therefore, I would like to conclude that a Central Bank can be considered as having its independence when it can perform its duty of achieving and maintaining price stability without any political or governmental interference, and with honesty and integrity while working hand in hand with the Ministry of Finance to achieve a balanced fiscal and monetary policies mix that lead to macro stability and sustainable growth. Inflation targeting approach is an effective mean to achieve Central Bank independence because it encompasses 4 very important ingredients: operational independence, responsibility, transparency and accountability. Other means can be just as effective if they have these 4 required ingredients.
Those buffers ensure that banks are able to provide financial services to euro area households and businesses, even in the face of adverse developments, thereby smoothing rather than amplifying the impact of negative shocks 1/5  BIS central bankers' speeches  on the real economy. Banks with poor structural profitability can face higher funding costs and may be tempted to take on more risk.2 Within the euro area, weak banks are more likely than healthy banks to be connected to unprofitable firms.3 This reduces the flow of lending to profitable firms that need funding to invest and grow. The resultant misallocation of capital 4 towards unproductive businesses weighs on long-run economic growth.5 Low bank profitability can also matter for monetary policy by impairing the accumulation of bank capital over time. Thinly capitalised banks stymie the ability of monetary policy to stimulate economic activity in downturns. Their capacity to lower the interest rates they charge their customers and increase the volume of lending to the real economy is constrained.6 This limits the effectiveness of an important transmission channel of monetary accommodation in the euro area, which relies on bank lending supporting consumption and investment. As the crisis showed, dislocations in the banking sector can deepen recessions and seriously impair the smooth transmission of monetary policy across the euro area. That risk remains today. We recently carried out what we call a macroprudential stress test, which assesses this amplification of shocks using a micro-macro model that feeds back individual bank reactions into macroeconomic outcomes.

-  -  -  to provide financial knowledge to women in community, or schools (Primary and Secondary Schools), and enhance their entrepreneurship. Similarly, in 2021, the Ministry of Women’s Affairs and the NBC conducted “women entrepreneurs talk program” to promote financial inclusion and enhance digital financial literacy to women, woman enterprises, and woman university students. Under the “Catalyzing Women’s Entrepreneurship project”, the NBC has been closely cooperating with UNESCAP to initiate training and seminar for women and woman enterprises to enhance their financial management knowledge and increase their financial accessibilities and usage. The NBC has also been cooperating with Good Return to establish “Let’s Talk Money” Campaign, which was launched in 2016. So far, the NBC and Good Return had successfully achieved phase 1 of the campaign which consists of 6 educational videos, a comic book, a mobile application called NBC-Edu, as well as the creation of “Let’s Talk Money” Facebook page and website. In addition, Let’s Talk Money phase 2 “little by little” has also seen the delivery of 4 financial literacy videos, which has since reached hundreds of thousands of people through social media platform. The NBC and Good Return also conducted a training, targeted at representatives from Cambodia Women Entrepreneurs Association (CWEA) and Cambodian Women for Peace and Development (CWPD), which helps the women deliver face-to-face training to women entrepreneurs and garment workers respectively.
At its inception, the Bank started with 57 people with four departments. The Bank has grown in strength to more than 2,600 staff to accommodate our expanded roles. The modernisation of the Bank has involved change to the legal framework, our organisational and governance structure, and the nature of human capital, to enable the Bank to become more effective in the changed environment. As we advance forward into the future, the Bank will be confronted with increased challenges, and with many of the building blocks in place, the next phase of development of the Malaysia's financial sector will involve greater market liberalisation and internationalisation. These developments will intensify the demand for greater readiness, capacity and capability from the Bank to best serve the nation moving forward. This year, the Bank is in the process of submitting to Parliament a new Central Banking Act. As the economic and financial landscape, both domestic and international, is now significantly different from 50 years ago, the proposed Act involves a holistic review of the Bank's mandate, governance, accountability and the present legislative framework to ensure that the Bank remains effective in performing its functions. The institutionalisation of the objectives and mandates of the Bank aims to provide greater clarity to the existing roles and functions of the Bank. The proposed Act will also provide the Bank with the necessary powers and instruments to perform the Bank's roles and functions effectively.

For example, the scenarios considered by the UN Population Projections, built upon different assumptions on fertility, mortality and migration, suggest that the dependency ratio in Europe could range between 43% and 52% in 2050 and between 35% and 61% in 2070, versus today’s ratio of 29%. In sum, the uncertainty over these demographic projections is sizable, and the more distant the horizon, the greater this uncertainty is. Yet acknowledging our limited ability to produce precise forecasts about the future should not lead us to trust in the more benign scenarios eventually materialising. In fact, in the realm of demographic projections uncertainty travels in both directions. While some scenarios point to more moderate population ageing, for instance as a result of higher fertility, others suggest that the dependency ratio could be substantially higher than projected in the baseline. In fact, in countries such as Spain and the United Kingdom, it has not been uncommon to under-predict life expectancy in successive projection rounds. Against this background of demographic change, it is worth examining the multiple effects that an ageing population may exert on the macroeconomy, including the macroeconomic policies that governments and policy-makers implement as a result. 5  Macroeconomic implications  Demographic changes come with wide and profound economic consequences. Most relevant for macroeconomic policies are, at least, three such consequences. One is the implication of a smaller and older working-age population for potential growth and inflation.