samchain/econo-pairs-v1 huggingface dataset:
These three most important elements are dependent on developments abroad, international financial markets, and global demand for commodities. The Swiss franc exchange rate, by comparison, does not play a decisive role. There is thus no contradiction between having a strong Swiss franc and a large current account surplus. Nor is the surplus a suitable measure for assessing Switzerland's share in global imbalances. It is much more the case that Switzerland and its extensive level of direct investment abroad contributes significantly to balanced global economic growth. SNB monetary policy is focused on ensuring price stability. In so doing, it takes due account of economic developments. To fulfil this mandate, the SNB must secure appropriate monetary conditions. The current account surplus does not play a role in monetary policy. In an open economy like Switzerland, however, sizeable exchange rate fluctuations have a strong impact on production and prices. In the current environment, and with interest rates close to zero, the minimum exchange rate is therefore the correct monetary policy instrument. The SNB will continue to enforce it with the utmost determination. BIS central bankers’ speeches  1

As a result, the intermediation was taken up instead by financial systems in the advanced economies which, as we know, led to risktaking and a major asset price bubble. In closing, I want to end my remark by making a few observations on the direction of global finance going forward. As a matter of fact, the current crisis is also a crisis of globalized finance, considering the damage that has been done to the global banks and financial markets. Lessons learnt from this crisis will definitely bring about important changes in the global financial landscape, as well as in the regulatory approach to bank regulation and supervision. On this, key trends we can expect to see in the emerging financial landscape will include, on the demand side, consumers becoming more risk averse and having preference for local institutions and for simplicity of transactions and instruments, while demanding greater accountability and transparency. On the banking side, business models of banks will become more conservative, relying less on wholesale funding and on the use of leverage, while giving greater importance to risk management and higher liquidity buffer. And on the regulatory front, more emphasis will definitely be on public surveillance and the use of macroprudential oversight, with focus on system-wide stability, closer supervision of the systemically important financial institutions including non-banks, and establishing an international procedure for an orderly unwinding of a troubled systemically important global player.
The alternative is, of course, a fixed exchange rate, which in Sweden's case would be synonymous to adopting the euro. In the short term we have managed perfectly well outside of EMU, with lower interest rates and inflation and a higher growth rate than the euro area. However, in a longer term perspective, periods of a wrongly valued krona and major fluctuations in the exchange rate – and we will probably have to live with these – may be a high price to pay. For a small economy with a large foreign trade like Sweden this is a development worth considering. Some conclusions Let me finish where I began, namely by concluding that the economic situation still appears uncertain in essential areas. The main clue is that the American economy will show an upturn, but take a more prolonged path than the V shape. However, there are imbalances that could cause a much less favourable development. In addition, the inflation rate has begun to rise more than expected. There is no sign of improvement in Japan; on the other hand there is a risk of a "cooling down" in the finance sector really taking hold, following an incubation period of ten years. In the longer-term perspective, this may be necessary to put right the underlying problems, but in the short term it may have undesirable effects on the global economy. In Sweden we can see continuing sings of a slowdown.

Financial crises typically result when we fail to identify vulnerabilities, and then unexpected triggers turn those vulnerabilities into points of weakness that can lead to catastrophic failure. The discontinuation of LIBOR, however, is different. We can see it coming, and we know the impact of a disorderly transition would be huge. Therefore, a half-hearted effort or a failure to act would be inexcusable, especially after all we have learned from the experience of the financial crisis. Moving this core piece of the global financial system to a firm and durable foundation is essential and worth the cost. This task is admittedly hard, but I am optimistic given our past successes. We have demonstrated that effective collective action can provide solutions to longstanding structural vulnerabilities in the financial system. A key lesson from the crisis is that structural vulnerabilities must be addressed continually. If they are ignored, larger problems eventually will result. For example, through collective action over the past decade, we have successfully addressed structural weaknesses in the tri-party repo market, the over-the-counter derivatives market, and money market mutual funds. Each of these challenges required a tailored solution that relied on different tools—including a diverse mix of market, regulatory and supervisory measures—to get the job done. Everything isn’t a nail, and the best tool is not always a hammer. You have to identify the problem that needs fixing and select the right tool for the job. This is likely to require both official sector engagement and private sector initiative.
It is time for the industry to come together and make a more significant impact through wellplanned investments in product design, risk management and to support consumer education in retirement planning solutions. Third, catastrophic events in Asia Pacific is rising. The region is also confronted by an increasing frequency and severity of catastrophic events. Eight of the 10 countries in the world with the highest annual natural catastrophe losses as a percentage of GDP are located in Asia. Over the last 20 years, natural catastrophe losses suffered by Asia accounted for almost half of the world’s estimated economic losses from natural disasters, yet only 7.6 per cent of such economic losses in Asia were insured compared to 67 per cent in the United States for example. These significant protection gaps that are prevalent across most of Asia and expose the vulnerability of the population and economies of the region to hardship due to loss of lives and damage to properties following a catastrophic event. The poor are most severely affected. While some countries have implemented disaster-risk insurance schemes or provide Government assistance to alleviate such losses, others continue to be exposed. In response to this challenge, more is being done among developing economies, including under public-private sector partnerships, to develop and increase access to affordable micro protection plans as a means of helping millions of people cope in the most difficult times.

This meeting of great minds will be the path towards building future leaders and respected finance professionals. It will be a hub where the best minds in finance will come together to contemplate, reflect and discuss on the frontiers of finance. In the pipeline are also plans to develop a mentorship programme supported by financial industry leaders, including bankers for fintech startups. This will expand horizons for ideation, enable cross-fertilisation of knowledge and boost startups in their journey to be successful ventures. This will be launched by the end of the year. Guardians of the future With the acceleration of technology, the financial sector of the future will be vastly different from what it is today. Fintech innovation, regulatory reforms, deepening integration and shifts in consumer demographics and preferences are some of the forces that will drive this change. Future bankers of the Malaysian financial sector will encounter opportunities and challenges not seen before. New jobs will be created and existing jobs will change or become extinct. Automation will change the back and middle office functions. Artificial intelligence will change how banking services are delivered to the consumer. Data science and big data will change the way financial and data analytics are conducted. Yet, the fact remains that we cannot predict the future with great certainty. In one of my speeches last year, I mentioned four possible scenarios on how the future of finance may unfold. The possibilities are exciting and almost limitless.
“The budget should be balanced, the treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled … lest we become bankrupt. People must again learn to work, instead of living on public assistance.”  BIS Review 60/2009  7

Bean, C., M. Paustian, A. Penalver and T. Taylor (2011), “Monetary Policy After the Fall”, in Macroeconomic Challenges: The Decade Ahead, pp. 267–328, Federal Reserve Bank of Kansas City. Bernanke, Ben (2010), AER Papers and Proceedings [speech at AEA meeting, January 2010] Bernanke, Ben (2011), ”The Effects of the Great Recession on Central Bank Doctrine and Practice”, speech at the Federal Reserve Bank of Boston 56th Economic Conference, 18 October 2011. Calmfors, Lars (2012), “Riksbanken måste bli tydligare (The Riksbank must be clearer), column in the Swedish newspaper Dagens Nyheter on 13 September. Claussen, Carl Andreas, Magnus Jonsson and Björn Lagerwall (2011), “A macroeconomic analysis of housing prices in Sweden”, in Sveriges Riksbank (2011), pp. 67–95. Englund, Peter (2011), “Swedish house prices in an international perspective”, in Sveriges Riksbank (2011), pp. 23–65. Finansinspektionen (2012),”The Swedish Mortgage Market”, 13 March 2012. Ingves, Stefan (2012), “Stora risker med alltför låg ränta”(major risks with an overly low interest rate), Svenska Dagbladet newspaper, 18 October. Isaksen, Jacob, Paul Lassenius Kramp, Louise Funch Sørensen and Søren Vester Sørensen (2011), ” Household Balance Sheets and Debt – an International Country Study”, Danmarks Nationalbank Monetary Review, 4th Quarter 2011, Part 2, pp. 39–81. Jansson, Per (2012), ”My view on inflation targeting”, speech at Karlstad University, 11 October. National Institute of Economic Research (2012), The Swedish Economy, August 2012. Mishkin, Frederic S. (2011), ”Monetary Policy Strategy: Lessons from the Crisis”, NBER Working Paper No. 16755. 14  BIS central bankers’ speeches  Qvigstad, Jan F. (2005), “When Does an Interest Rate Path ‘Look Good’?
When the COVID-19 shock hit financial markets in March this year, volatility spiked sharply and liquidity stresses emerged in global and domestic funding markets. The tighter financial conditions would have impaired banks’ ability to fund themselves and extend credit. MAS has kept a higher level of Singapore Dollar liquidity in the banking system to ensure banks have ample funding to extend credit to the economy. Interest rates in Singapore have fallen, with the one-month SIBOR currently around 0.25%, 5 / 15  BIS central bankers' speeches  compared to about 1.75% at the start of the year. Singapore’s long term interest rates have also fallen in tandem. The 10-year SGS yield is currently trading at about 0.9%, compared to 1.7% at the start of the year. This has helped to lower borrowing costs in the corporate bond market. MAS has also taken steps to provide US Dollar liquidity to support needs in Singapore and in the region. As an international financial centre, Singapore plays a key role in intermediating the flow of US Dollar denominated cross-border credit from advanced economies to emerging Asia. With global US Dollar funding markets coming under strain earlier in March of this year, MAS stepped up the provision of US Dollar liquidity through its daily money market operations. We provided up to $ billion of foreign exchange swaps per day, a 25% increase from our usual volumes.

Ravi Menon: Monetary Authority of Singapore's Annual Report 2019/20 Remarks by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at MAS' Annual Report 2019/20 Virtual Media Conference, Singapore, 26 July 2020. * * * Good morning, and welcome to MAS’ first virtual media conference for the annual report. I hope everyone has been keeping well. GLOBAL ECONOMY Let me begin with the global economy. There are three points I’d like to make. The world is facing an unprecedented economic situation. The outlook is highly uncertain. Recovery will be uneven. The world is facing a public health crisis and a consequent economic crisis. The COVID-19 virus has now spread to all corners of the world. Measures necessary to contain the pandemic – lockdowns, movement restrictions, border controls, and safe distancing – have brought many economic activities to a grinding halt. We are now in the midst of an economic recession without modern precedent. The global economy contracted nearly 14% q-o-q [1] in the first quarter of 2020 – this is almost three times deeper than the sharpest decline seen during the Global Financial Crisis. The contraction in the second quarter is likely to have been even deeper, since this is when economies outside China were most severely affected by the virus and shutdown measures. The policy responses to the COVID-19 crisis have been equally unprecedented – in scale and in speed. Governments injected massive fiscal stimulus, estimated on average to be twice the fiscal impulse in 2009.
Eventually, this will be pulling the rug from under the financial sector, undermining confidence which is the basis for the financial market in general. I hope that this year the Association will be addressing this problem of self-regulation when the banking community is capable to reach agreements in a civilised way, develop rules on its own, and control their fulfilment. I believe that the maturity level of banks, the banking system, and the financial market certainly makes it possible to develop self-regulation in banking which is lacking now. Therefore, we are forced to act in this way imposing restrictions and sanctions. In my opinion, this is still not a long-lasting trend, and we should think about how we may progressively develop a self-regulation institute. Lastly, I would like to say just a few words about large-scale and longer-term priorities in regulation and challenges. As regards this issue, I am happy that we have a common view of these challenges associated with digitisation, the emergence of green finance, sustainable development in general, and cyber risks. These are really long-term problems we need to respond to. Probably, a digital ruble is one of the most frequently discussed topics today. From the very beginning when we started to prepare our consultation paper on this issue, we were aware that banks might be wary about this idea. However, digitisation is disrupting the entire payment market in a large number of countries, with consumption behaviour models also altering. The development of central bank digital currencies has become a worldwide trend.

A priority will be given to those projects that will contribute to the well-being of future generations. We are interested in the development of green finance instruments. However, it is also vital to assess the actual risk level for investors. We are well aware of the fact that a lot of Russian companies are highly carbon-intensive. Therefore, it is necessary to assess their risks taking into account, among other factors, the introduction of carbon taxes in the European Union and other countries. Global investors are already altering their strategies. Moreover, banks themselves need to factor in climate risks in their operations. This is a serious challenge to the economy, the financial system, and the regulator. We should learn how to adequately assess not the risks that have been accumulated before. We are differentiating risk assessment in regulation relying on actual data showing how these risks materialised. We should assess future risks and model these future risks, building these stress scenarios. In our opinion, we may not blindly lower the requirements for these green instruments, but we should develop an approach helping an investor understand that a particular project is really a green one and assess the level of its sustainability and risks that may arise, as well as how they differ from those inherent in socalled non-green projects. This is an issue to be addressed in the course of our joint work. We have already made a certain progress towards better information transparency.
The risks the world economy faces in the medium term - associated to an abrupt resolution of global imbalances, a commodity price downturn, a slowdown of global growth, or an abrupt shift in risk perception and valuation by global investors - require that the agenda on international financial architecture be focused more on preventing, rather than resolving crises ex post. As countries are progressively more integrated into a more global financial system, new challenges emerge for economic authorities. The increased mobility of international capital flows - beyond their potential benefits - entails the risks of sudden and unexpected reversal of capital flows that could be further worsened by the contagion associated to the financial market reaction. Also, in the current market-driven international environment, characterized by increasing access of emerging economies to private funding, and by a more complex international financial system, externalities, market failures and perverse incentive effects are still in place and impede private financial flows to become a permanent and stable source of financing. Therefore, strengthening countries’ resilience is not only about developing and improving appropriate and consistent policies and institutions, but also about providing countries with access to emergency liquidity and the possibility to obtain short-term liquidity by private financial instruments. The Fund should therefore play a leading role in facilitating the development of more complete global financial markets, which will ultimately help emerging economies to protect themselves against external reversals while complementing authorities’ efforts in building up a sound policy framework.

BIS Review 2/2007  3  Our commitment for the future is to continue working constructively in the improvement of the quota system, the strengthening of the governability, credibility and effectiveness of the Fund. 4  BIS Review 2/2007
Based on this analysis, in the third part of my speech I will describe the wide-ranging regulatory measures taken at international and national level to resolve ‘too big to fail’. Let me just present our own conclusion up front: In Switzerland, the response was quick, targeted and, at the same time, cost-effective. On the one hand, the regulatory amendments strengthened banks’ resilience, reducing the likelihood of a bank getting into financial distress. On the other hand, they introduced measures aimed at ensuring that even a systemically important bank can exit the market in an orderly way in the event of a crisis. We are convinced that the Swiss big banks and the Swiss banking system are much more weatherproof today than they were ten years ago. Many of the planned measures have already been implemented. Page 2/14  However, we have still not quite achieved our objective. Only once the agreed measures have been fully implemented will the conditions for resolving ‘too big to fail’ in Switzerland be in place. The ‘too big to fail’ issue So what is behind ‘too big to fail’, and what concrete form does it take in Switzerland? a) ‘Too big to fail’ institutions must be bailed out in a crisis ...  As I mentioned at the start, ‘too big to fail’ means that an individual institution is so important that the state is under a de facto obligation to bail it out in a crisis. This state obligation arises under two conditions.

Correlations between regional import volumes rose to close to unity at the height of the crisis (Chart 12). The strength and length of global supply chains caused a synchronous collapse in trade (Bems et al (2012)). The second was the Japanese earthquake and tsunami in 2011. Because Japan plays a central role in global supply chains as a producer of high-value intermediate goods, this had a cascading effect on global production. For example, as Japanese car producers ceased production, their foreign affiliates were unable to compensate because they depending on inputs from Japan (OECD (2013)). Deepening global supply chains mean a large number of countries are now potential “super-spreaders” of global trade contagion. The story is similar, if on an even more dramatic scale, when it comes to global banking. Chart 13 plots the network of cross-border bank lending flows across a wide range of countries, in 1980 and in 2007. As with trade, the wiring of the international banking network has become significantly more dense and complex (Minoiu and Reyes (2013)). 11 And as with domestic banking networks, there is a clear core-periphery pattern to the network, with a small number of nodal “super-spreader” banking sectors serving as international lenders to the periphery banks. The global financial crisis provided a telling illustration of the susceptibility of such a network to a weakening, or failure, of the core banking sector. As these core sectors came under stress, it caused a significant cascading of global interbank contagion.
Especially important with regard to our topic is the distinction between central bank money on the one hand and commercial bank money – i.e. deposits with commercial banks – on the other. The two differ in terms of characteristics and risks, as well as in the way they are created. Central bank money comprises banknotes in circulation and the sight deposits held by commercial banks at the central bank. 2 Both are legal tender, which means that no restriction may be imposed on their acceptance. 3 Central bank money, like all nominally denominated money, is subject to the risk of inflation, in other words to the risk of losing in value as a result of rising prices for goods and services. Apart from this, however, central bank money is practically risk-free. 4 In Switzerland, central bank money is created by the Swiss National Bank. Whenever, for example, the SNB purchases foreign currency or Swiss franc denominated securities from a commercial bank, it credits the amount paid to the sight deposit account of the bank concerned in Swiss francs. If the SNB wants to reduce the amount of central bank money, also known as the monetary base, it can conduct transactions in the opposite direction. It then sells foreign currency or Swiss franc denominated securities to banks and charges the corresponding amount to their sight deposit accounts. The SNB is thus in a position to either increase or decrease the monetary base in accordance with its monetary policy goals.

If we look back to the time when the first deposit banks were established in Italy in the late Middle Ages, we see that the financial system has undergone continual change. After the establishment of banks, central banks and bank regulation emerged, partially in response to the fragility of the banking system in its early years. What we see today is a system that has evolved incrementally over time. While there are differences between countries – often for historical reasons – they all have a fractional reserve system, i.e. they do not have sovereign money. Page 11/12  We will no doubt continue to see changes. Technological advances, which are notoriously difficult to predict, are among the key drivers here. It is therefore hard to know precisely how the banking system will look in the future. It is clear, however, that central banks and financial market supervisory authorities will need to find ways of responding to these changes. This is not a new challenge, but it is one we will have to face time and again. Page 12/12