samchain/econo-pairs-v1 huggingface dataset:
As Raguram Rajan summarized in his book “Fault Lines”: “The financial sector is, in many ways, the brain of a modern economy. When it functions well, it allocates resources and risk effectively and thereby boosts economic growth. [...] It works for all of us. Of course, when it works poorly, as has done recently, it can do enormous damage while befitting a very few.”12 Part of the failures was certainly attributable to deficiencies in financial regulation and supervision. The regulatory overhaul of the financial sector is intending to correct this and thus help the financial sector to refocus on its servicing role. 10  See Schumpeter, J.A. (1934), “The Theory of Economic Development: An Inquiry into Profits, Capital, Credit, Interest and the Business Cycle”, Harvard University Press. 11  For this list of functions see Levine, R. (2005), “Finance and Growth: Theory, Evidence, and Mechanisms”, in P. Aghion and S. Durlauf (eds), The Handbook of Economic Growth, North Holland. 12  See Rajan, R.G. (2010), “Fault Lines”, Princeton University Press. 6  BIS central bankers’ speeches    Strengthening of bank capital and liquidity standards,    addressing systemically important financial institutions,    improving over-the-counter infrastructures,    and a reform of compensation practices, that I mentioned before,    these are all important elements in this process. derivatives  markets  and  core  financial  market  At the same time, regulatory reforms themselves require regular revaluation.

We acted swiftly to defeat the manipulators at their own game with a series of measures that threw them off their guard, drove them out of the market, and raised the defences against future attacks. First, drawing on the official reserves, we went into the stock and futures markets. In the second half of August we accumulated $ billion worth of shares: I am happy to say they are now worth $ billion, but our aim was not to make money; it was simply to deter manipulation by making sure that it did not pay off. That objective was achieved. The manipulators were forced to close out their short positions, in many cases with heavy losses. And we followed through with a package of technical measures to strengthen our currency board arrangement to make our money market less susceptible to manipulation. These measures are working well. Further reforms are being introduced in the securities and futures markets to reduce the possibility of market dislocation. Our actions served their purpose of deterring market manipulation. We could not passively sit through the speculative attack and see our markets overshoot to produce profits for the manipulators, and our entire financial system brought to the brink of collapse. We do not pretend that our intervention in the markets was not a controversial act. This was not a decision that we enjoyed taking. It involved many risks, not least among them the risk of being misunderstood.
As national financial sectors become increasingly integrated and interdependent, another top priority for us must be to strengthen our understanding of the factors that drive global capital asset allocation, and the reasons for capital flows across sectors and national borders. Early identification and assessment of capital flows will help us evaluate vulnerabilities in a timely manner, as well as enhance  BIS Review 43/2005  3  countries’ ability to address them. The effectiveness of our bilateral and multilateral surveillance activities will also be strengthened as a result. For members who wish to access international capital markets and integrate their economies more fully into the global financial system, we can provide advice on the appropriate sequencing of measures, such as how to strengthen their financial sectors and reduce their vulnerability to shocks as preparatory steps. Third, IMF financing and lending. The Fund’s traditional role of providing financing to help smooth the adjustment of temporary current-account imbalances remains vital for many countries. For others, our main task is to help prevent, or mitigate, capital account crises and their cross-border contagion effects. To succeed in these roles, the IMF must be able to exercise selectivity in supporting only those adjustment programs that will put the relevant members firmly on the path to external viability. The existence of robust domestic institutional frameworks, and strong national ownership of programs, would be key.

Some issues which may warrant closer examination include: •  Ensuring that resources in the Poverty Reduction and Growth Facility – our main lending instrument for developing countries – remain adequate to meet future demands;  •  New ways to help low-income countries deal with economic shocks;  •  In the case of low-income countries which do not need or want IMF lending, how to enhance the IMF’s role in signaling to others the strength of these countries’ policies;  •  The role of the Fund in supporting low-income countries’ poverty reduction strategies; and  •  Our relationship with donors and aid agencies. As a partner of the 2002 Monterrey Consensus, the IMF is committed to supporting countries in their efforts to reduce poverty and reach the Millennium Development Goals. Our unique position gives us the potential to contribute to building both pillars of the Monterrey Consensus. On one side, we can work with countries to design policies and build institutions that will help them grow out of poverty. On the other, we can advocate for more and better international support, and help with its coordination. Nevertheless, examining the issues highlighted earlier will help frame a better understanding of the areas of low-income country work for which the IMF can take responsibility, and those that will fall to other institutions and actors. It would be helpful to have greater definition in this area as we approach the U.N. Millennium Summit in September. Fifth, the IMF’s internal governance and management.
FX depreciation (bp)  Figure 1: ER and long-term yields in reaction to US MP shocks (CHL vs MEX) (†) Chile Mexico 400  400  300  300  200  200  100  100  0  0  -100  -100  -200  -200  -300  10-Year interest rate (bp)  -400 -20 -15 -10 -5  -300 y = 5.4 + 6.1x -400 0 5 10 15 20 -20 -15 -10 -5  20  20  15  15  10  10  5  5  0  0  -5  -5  -10  -10  -15 -20 -20 -15 -10 -5  y = 16 + 1.19x 0 5 10 15 20  -15 y = -0.5 + 0.15x 0 5 10 15 20  -20 -20 -15 -10 -5  y = -1.9 + 1.1x 0 5 10 15 20  US monetary policy shock (bp)  (†) A rise in FX indicates a depreciation of the domestic currency against the dollar. The sample corresponds to the post Nov-08 average. Source: Central Bank of Chile. Recent research conducted at the Central Bank of Chile highlights this point. Figure 1 shows the impact of US MP shocks (changes in US short-term rates around Federal Reserve meetings) on ER and long-term bond prices in Chile (with clean floating) and Mexico, which has actively intervened in recent years.

While the IMF used to be the guardian of the system of fixed exchange rates established in Bretton Woods in 1944, it now works to promote international financial stability. In this role, it oversees the overall economic and financial position of its member countries. More than ever before, its activities are primarily aimed at crisis prevention. BIS Review 111/2006  1
So, even supposing we could influence the exchange rate in the direction we would no doubt all like to see - the hard question for us in current circumstances is could we - and should we - attempt to do so, in order to try to shelter internationally-exposed businesses, if that were to mean putting our objective of sustained low inflation at risk. In fact I’ve not heard anyone argue openly for that - and I would be surprised if they did. The reality is that if we were to put the economy as a whole at any significant risk of accelerating inflation - notwithstanding our mandate - we would not succeed in providing the intended protection even to the internationally-exposed sectors, except possibly in the very short term; and we would jeopardise the prospect of sustained growth in the economy as a whole further ahead. That very clearly was what happened when we sought to hold the exchange rate down against the DM for a time in the 1980s. There is no simple solution to this very real dilemma. And while I really do understand the pain that many internationally-exposed businesses are suffering, I’m afraid my vote must go with those who voted yes on the first ballot. Now let me turn to the second - and quite distinct question - which relates to the practical operation of monetary policy.

Our latest Inflation Report forecast published last week - based on constant 6% interest rates, and on reasonable central assumptions about certain other key elements in the forecast - projects continuing overall output growth - of around 3% initially, moderating to around 2½% from around the end of this year - with continuing low inflation - at a rate of around 2% this year but rising back to around the 2½% target in the course of next year, with the risks - on these assumptions - modestly on the upside. But, given the current uncertainties, individual members of the Committee quite naturally prefer their own alternative assumptions about some of the key variables - most notably the likely future path of the exchange rate and the size and duration of the effect of the downward pressure on margins. And these varying assumptions could either raise or lower the rate of inflation two years ahead by up to ½ percentage point. That, Mr Chairman, is all fairly technical stuff. The point to hold on to is that, on a reasonable range of assumptions, the prospect for the economy as a whole over the next couple of years is for continuing steady growth with low inflation, and most of us would happily settle for that. The debate is about just how strong the growth and just how low the rate of inflation.
19  10  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  10  Setting a target for the overall climate properties of the portfolio will help shape and steer our investment decisions, and provide transparency and accountability. At first sight, the framing of this target seems obvious: to achieve net zero by 2050. But 2050 is well beyond the likely lifespan of the CBPS. And ‘achieve net zero’ does not tell our staff which bonds to trade. So we need a nearer-term, intermediate, goal – in measurable units. The Discussion Paper considers a number of options (Chart 6). The first, a declining path for the carbon footprint of the portfolio, is simple to state and measure, and can be aligned with the Government’s target path to net zero. Implementing it at a more granular level is however complicated by the limited availability of appropriate sectoral pathways to net zero. Chart 6: Options for intermediate portfolio targets  11  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  11  A second, more forward-looking, approach would be to use an ‘implied temperature rise’ metric to target a declining temperature path. These convert data and projections of the current and future emissions of companies held in the portfolio into estimated future temperature levels, using assumptions about how those emissions compare to target paths.

This so-called ‘Corporate Bond Purchase Scheme’ (CBPS) was increased to £ in 2020, in response to the economic impact of Covid. It’s therefore fair to ask: as an investor in corporate assets in our own right, should we be taking steps to support the achievement of net zero? The Bank as investor: reconciling monetary policy goals and market mispricing  The first point to underscore is that the CBPS began as, and will remain, a monetary policy tool. That means that the overall target stock will continue to be set by the MPC to achieve its inflation objective. So, in due course, when the economic outlook allows, the fund will unwind. We do not expect to be a permanent investor. To achieve the policy goals of the Scheme, eligible bonds must be issued by non-financial companies making a material contribution to UK economic activity. And to protect public money, the Bank imposes controls on credit quality, portfolio concentration and other financial risks.12 These elements of the scheme will not change. A more interesting question relates to the composition of the CBPS. Up to now, we have aimed to replicate the structure of the sterling corporate bond market itself. We do that by dividing up our purchases across sectors according to the amount of debt outstanding; and within sectors using competitive reverse auctions. The rationale for allocating purchases in this way has been to minimise the impact of the CBPS on relative borrowing costs across sectors and firms.
This includes reviewing the responsibility and accountability of the Board and Management as well as requiring for the setting up of various Board committees. In the case of Malaysia, the High Court of Malaysia has dedicated high court judges to preside on litigated cases over matters relating to Islamic banking and finance. To undertake a holistic legal review, the Central Bank of Malaysia has set up a Law Review Committee to review the common law-based domestic legislations to assimilate the Shariah principles with the aim of removing any impediments to ensure the unhindered and efficient functioning of the Islamic banking and financial system. The Central Bank Act has also been amended to provide for the establishment of a Shariah Advisory Council at the Central Bank as the sole authority and reference on all Shariah matters pertaining to Islamic banking and finance. The successful integration of these core components to become a comprehensive Islamic financial system has contributed towards a more active domestic Islamic financial intermediation process. To-date, Islamic banking has mobilised assets amounting to RM76 billion or 10 percent of the market size, of which approximately 70 percent of the Islamic banking assets were generated by the conventional banks with Islamic windows. In the takaful sector, the four takaful operators registered a total of RM4 billion in terms of assets.

Islamic banking operations therefore need to be governed by its own standards and best practices in parallel with the international best practice. The establishment of the Islamic Financial Services Board (IFSB) in 2002 as an international prudential standard-setting body to promulgate the international regulatory and supervisory standards for Islamic financial institutions is aimed towards achieving this objective. In this regard, the IFSB has already made progress in developing the prudential standards on the capital adequacy and risk management framework. These standards are expected to be completed in 2005. In addition, the IFSB will commence work on developing standards on corporate governance. At present, some countries have adopted the Basle Accord standards in their regulatory and supervisory framework for their Islamic banking industry. However, these standards do not adequately  2  BIS Review 3/2004  address the requirements of Islamic banking operations and transactions, resulting in gaps in the standards. Therefore, these gaps will be taken into account with respect to the capital treatment and risk associated for the different types of Islamic financial contracts to truly reflect their features and characteristics. While certain products in Islamic finance by their nature may not attract capital, the Islamic financial institutions need to have a more rigorous risk management systems in managing the funds placed under this arrangement. In this regard, the risk management standard needs to specifically address this concern. The Islamic financial institutions can expect to be better regulated and supervised following the adoption of the standards to be issued by the IFSB.
But, from what I gather as an observer from afar, there are a number of other factors, less tangible, which also contribute to that scepticism. I shall go through some of them with you, noting once again that perception from many miles away may indeed be quite different from reality. The first factor concerns structural rigidities, which appear to observers from my side of the world to be more serious in Euroland than in many other economies, big and small. The severity of these structural rigidities is seen to be undermining the ability and the efficiency with which Euroland can respond to change. Of course, we recognise that some loss of adaptability may be the price that has to be paid for a relatively stable society and a comfortable social safety net, and that the trade-off has effectively been arrived at through a democratic process. But it is hard to believe, as an outsider, that the trade-off is an optimal one. I cannot imagine, for example, what goal of social stability could justify labour market and social security arrangements that deliver an unemployment rate of double digits; or contribute to delaying, if not preventing, the arrival of the “new economy” in Euroland. I understand that some still do not believe that there can be a new economy, in which the technological revolution enables productivity gains that are capable of sustaining a much higher rate of non-inflationary growth. Of course, we should always question and critically examine any unusual phenomena, rather than embrace them blindly.

A good guess seems to be that the shorter the interval before participation, the quicker will be the changeover to euro. The world will not be the same The creation of a monetary union just outside Sweden's borders will change the world as we know it. Individuals and firms will both be affected by the euro's introduction whether we participate or not. In our efforts to keep the financial sector informed about EMU we can see that good progress has been made with the preparations. Among those concerned we also experience a strong desire to participate as early as possible so as not to get left behind. Swedish banks and other companies want to have a chance of competing on equal terms and do not wish to risk losing business opportunities. Finally I therefore wish to underscore that saying no to the single currency is not the same as status quo. As I said, the euro's introduction will affect us all, whether or not we participate. EMU will probably accelerate the globalisation, concentration and integration of the world's financial markets. It is therefore of the utmost importance that we all do what we can to find out more about these complex matters. BIS Review 41/1997
There should be ways for countries to cope with bank runs on the international scale. There should be opportunity for countries to renegotiate their debts with the foreign creditors, without imposing an insurmountable handicap that will prevent them from returning to the market in future. In the case of Thailand, had such mechanism existed during the Asian crisis, our non-performing loan ratio would have been less. Actually we paid back all foreign debts owed by the government and by the banks in full, with interests. We never needed any hair cut, we just needed time. But many foreign banks did not roll over the debts that fell due, despite the fact that the authority guaranteed all foreign debts of the banks. The continuous repayment caused the currency to weaken more than it should. The exchange loss was therefore greater than should have been, and hence the non-performing loan ratio. At the same time, our weak currency also created pressure on the exchange rates of our neighbors, causing the interest rate to be kept high for longer than necessary, which in turn also fed into the non-performing loan ratio. 2  BIS Review 52/2002  I am therefore attaching a lot of hope to the Sovereign Debt Restructuring Mechanism now being deliberated by the IMF members. I do hope that it will offer better solutions for this kind of problems in the future. I will close by saying this. Globalization is a two way street. Relationship in the international financial market benefits both ways.

Concluding, I would like to thank all the researchers, the speakers, the audience and our collaborators, who responded positively to our call for participation. With these words, I wish you all fruitful deliberations, I wish the conference all success and I wish all the guests an enjoyable stay in Tirana. Thank you! 2/2  BIS central bankers' speeches
A similar view emerges from the talks conducted every quarter with over 200 companies by the SNB’s delegates for regional economic relations. Inflation expectations are thus within the range that is consistent with the SNB’s definition of price stability. Like inflation expectations, short and long-term interest rates in Switzerland have hardly changed since summer. Short-term money market rates have remained close to –0.75%, and the yield on ten-year Confederation bonds has fluctuated between 0% and –0.2%. The interest rate differential with the euro area has been largely stable. By contrast, the interest rate differential with the US has widened somewhat, due to higher US interest rates resulting from tighter monetary policy. There has, however, been movement since June with respect to exchange rates. Over the past six months, the Swiss franc has depreciated against the euro by about 7%. In addition, since the last monetary policy assessment in September, a mild weakening has occurred against the US dollar. The trade-weighted nominal exchange rate for the Swiss franc is currently about 5% lower than in June. The depreciation in real terms is roughly similar. The weakening of the Swiss franc has contributed to reducing the overvaluation. However, the franc is still highly valued. What lies behind these exchange rate movements? In the first phase, from June to September, the Swiss franc depreciated against the euro, while remaining largely stable against the US Page 3/4  Berne, 14 December 2017 Thomas Jordan  News conference  dollar.

For the euro area and the US, we have revised our growth forecasts slightly upwards. Economic recovery and convergence with the inflation target are most advanced in the US. This prompted the US Federal Reserve to carry out a number of interest rate adjustments and to initiate the reduction of the balance sheet this year. The coming quarters are likely to see a gradual continuation of monetary policy normalisation in the US. By contrast, the European Central Bank intends to pursue its asset purchase programme until at least September 2018, and to leave its key rates unchanged beyond that horizon. In Japan, too, monetary policy is expected to remain expansionary. Alongside the global economic baseline scenario, the risks also need to be taken into consideration. In the short term, global growth could be stronger than projected in the baseline scenario, due to the significant upturn in household and business confidence. In the medium term, however, risks for the international economy are still to the downside. These risks include ongoing structural weaknesses, political developments in certain countries, and potential international tensions. Furthermore, the normalisation of monetary policy in the advanced economies presents challenges. An abrupt rise in the currently very low capital market interest rates and risk premia, in particular, could negatively impact the global economy. Swiss economic outlook  I shall now turn to the economic outlook for Switzerland. GDP grew in the third quarter at an annualised 2.5%, lending further momentum to the economic recovery.