samchain/econo-pairs-v1 huggingface dataset:
Credit as a burden for an entire economy  The examples show that an actual or impending default on a loan can represent a serious burden for the party concerned or even a personal tragedy. To a certain extent, this explains the negative connotations associated with debt. However, from a macroeconomic perspective, default by a single borrower does not usually pose a problem. Unless the single borrower happens to be a massively indebted state or big bank. An impending default by such a player has a far-reaching impact on the economy as a whole, as witnessed in the recent financial crisis. Debt also becomes a macroeconomic problem when a large number of economic agents help themselves too generously at the credit buffet table. Such phases of excess on the credit market usually end with a large number of borrowers encountering payment difficulties. For the rest of my presentation, I would like to concentrate on this type of debt crisis and on the costs involved. Empirical literature indicates that recessions run particularly deep when they are connected with just such a debt crisis (cf. slide 9). Moreover, the subsequent economic recovery tends to be sluggish. This applies all the more when the debt crisis also hits the banking sector. 9 Why is this so? In a debt crisis following a credit boom, not just a few, but a large number of households and companies face payment difficulties and have less income and assets at their disposal.

First, requiring that we see inflation reaching two per cent not only “well ahead of the end of our projection horizon” but also “durably for the rest of the projection horizon” ensures that interest rate policy will not react to inflation shocks that are expected to fade away before the end of our projection horizon. Second, the condition that “realised progress in underlying inflation is sufficiently advanced to be consistent with inflation stabilising at two per cent over the medium term” serves an important purpose in our analysis of the incoming data: it sharply differentiates between the volatile components of headline inflation and the dynamics of underlying inflation, which is the persistent component that is the best guide to medium-term inflation dynamics. The inclusion of a condition that is based on realisations of underlying inflation takes into account the intrinsic uncertainty of economic forecasts, especially during periods of structural change that generate “disparate confounding dynamics”.1 Since the services sector constitutes a large share of the overall price level and since wages (adjusting for productivity) are the principal component in the price of services, the persistent component in wage dynamics plays a central role in the determination of underlying inflation. Accordingly, tracking wage outcomes and differentiating between transitory and persistent shifts in the growth rate of wages will play an important role in assessing progress in the realised path of underlying inflation.
However, one should not forget that the strike at Escondida, while very relevant to explain the first quarter figure, is a oneoff event that is not expected to generate significant spillovers on activity elsewhere in the economy, nor on inflation. 13. For these reasons we reduced our growth forecast for 2017, and we are now projecting GDP will be in the 1-2% range (1.5-2.5% in December). At the same time, for 2018 we are expecting the economy to grow between 2.25 and 3.25% (table 1). The growth recovery is based on the fact that the economy does not appear to have any relevant imbalances, the mining-related investment adjustment is expected to end, and as I mentioned at the beginning of my presentation, the global outlook appears more favorable. Fiscal policy is assumed to follow the fiscal consolidation path announced by the Government.

There has also been a recent shift in opinions coming out of academic research, from a broad resistance to taking financial stability into account when shaping monetary policy19 to greater openness to the view that there may be good reasons for doing so.20 Even before the financial crisis hit Europe and Swedish with full force in autumn 2008, there were concerns in the Executive Board that the credit expansion was too rapid and that housing prices were increasing too quickly so that a bubble might build up, and later burst to cause a severe recession. This was not the case in Sweden, but did happen in the United States and several countries in Europe. During the crisis years 2009–2010 the endeavour was instead to use low interest rates and liquidity assistance to the banks to avoid a credit crunch that could intensify the crisis. And we succeeded well in this. During the entire period, the banks’ total lending to households and companies in Sweden increased (see Figure 11). Put greater emphasis on the initial situation and the forecasts for the coming year We should put greater emphasis on the initial position and the forecasts for the coming year than on the long-term forecasts. At the Riksbank, considerable resources are put into analysing the state of the economy. The statistics received are analysed and commented on regularly.
Following the joint meeting of the ASEAN+3 Finance Ministers and Central Bank Governors in May this year, a press statement was released on their common position with respect to both macroprudential measures and capital flow management measures. I quote: “…deepening global financial integration …require MPPs and CFMs that counter increases in financial stability risks from changes in macroeconomic policies in countries with major currencies.” Beyond the resilience of policy frameworks, my third and final point has to do with the resilience of domestic fundamentals. Firstly, having a diversified, flexible and competitive economy is a key strength in dealing with instability from the external sector, whether it is in the real economy or in the financial system. Secondly, having a strong and resilient financial system is an important source of strength against vulnerabilities rising from living in an integrated world. In the period after the onset of the financial crisis in the AEs, many Asian economies have been able to sustain growth because their financial systems were healthy and were able to finance and support domestic economic activity even as growth in the AEs disappeared. A deeper and more diversified financial system can also help to intermediate capital inflows in a less distortionary manner. In the post-crisis period, we have been pleased that the depth of the financial markets in Malaysia and the presence of large institutional players have contributed to stability in the domestic financial markets, even in the face of significant volatility in foreign portfolio flows.

This is a particularly important source of resilience when confronted with a volatile global environment. The prudent conduct of monetary policy to ensure price stability and provide a supportive environment for sustainable growth is a key contribution of central banks. Ensuring that credit growth is not excessive and that it is not channelled into unproductive uses is important to guard against future problems with excessive leverage and bad bank assets. A financial system that is burdened by a legacy of bad lending is obviously not going to be able to efficiently perform its function when the economy is hit by an external shock. It is for this reason that over the past several years, BNM has strengthened the credit culture at our banks and non-banks, undertaken rigorous stress-testing of banks, and introduced various measures to address vulnerabilities arising from the household indebtedness. Fiscal policy, the other tool in the macro-policy toolkit, also needs to be conducted prudently and this is to ensure that there is fiscal policy space to respond to shocks. Prudent fiscal policy can be a significant force is supporting growth in the face of adversity. Another key determinant of policy effectiveness is whether policy makers have enough policy instruments to address the challenges that they are facing. With respect to risks related to financial globalisation, I will just mention three points. •  Foreign exchange reserves. Reserves are an important policy buffer for economies that are becoming globally financially integrated.
Since the June forecast the spectrum of risks has changed somewhat; the chances of inflation being higher than in the main scenario are now judged to be greater than the probability of a lower rate. The increased upside risk has to do with fears that inflation will react more quickly to the rising economic activity and that labour market shortages may be more serious and lead to a stronger development of wages. The assessment of an increase in upside risks is accompanied by less likelihood of a slowdown in the global economy. But there is still the risk of international activity being dampened appreciably in connection with a major correction of the high stock market prices and the financial imbalances that have been a feature of the American economy in recent years. Such a scenario would affect price tendencies in Sweden. The risk of financial bubbles, with serious real economic effects if they burst, is something that the Riksbank, along with other central banks, has to heed. Monetary policy In the late summer, at the monetary policy meeting on 12 August, the Executive Board had already noted that stronger economic growth in Sweden and rising resource utilisation pointed to growing upward pressure on prices. That in turn indicated that monetary policy might have to be given a less expansionary direction in the future. Two members of the Board even advocated a small repo rate increase in August.

The Central Bank forecasts the forthcoming inflation performance; this forecast is then compared to the targeted inflation rate; and the difference between the forecast and target determines the proper adjustment of the monetary political instrument. But, unfortunately or perhaps, fortunately, this relatively new monetary regime is not the rescue solution of a central banker’s affliction. I am confident that the honourable participants who are speaking during the three days of the seminar, shall enlighten in more details, based on the experiences of the central banks they represent, the complex issues and challenges they had to encounter, while adopting this regime. The agenda of this three-day seminar seems promising, and the interweaving of theory and practice is outstanding. It begins with the theoretical considerations on inflations targeting, proceeds with the three main pillars of monetary policy communication: independence, transparency and accountability. Not by accident, the new approach required by the inflation targeting regime has been defined as the “forecast path”. The distinguished economists from the Centre of Central Banking Studies shall introduce us to the econometric techniques, which come to help during the inflation forecast process. To conclude, the Czech National Bank, shall bring the experience of an economy in transition adopting this regime. And last but not least, on behalf of the Bank of Albania, I would like to thank the Centre of Central Banking Studies (Bank of England) for the opportunity granted to the institution I govern, to cooperate  1/2  and to consent the holding of this regional seminar in our country.
This flexibility is necessary in a world of elevated risks and uncertainties as well as rapid changes. Similarly, we strongly believe that the government would continue its fiscal consolidation measures, which will support us to pursue our policies towards macroeconomic stability. In particular, this will be a necessary condition for us to successfully adopt FIT as the monetary policy framework as planned. 32  Before concluding my speech, I would like to convey my sincere gratitude to a number of individuals who constantly contribute and support our efforts to carry out our functions of the Central Bank effectively. First and foremost, I am grateful to His Excellency the President Maithripala Sirisena, and Honourable Prime Minister Ranil Wickremesinghe for their guidance and leadership. I would also like to thank Honourable Minister of Finance and Mass Media Mangala Samaraweera for his support, especially in making every effort to ensure close coordination between the Ministry of Finance and the Central Bank. I highly appreciate the ample support and prudent inputs from the Members of the Monetary Board of the Central Bank. My sincere gratitude goes to Secretary to the Treasury, Dr. R H S Samaratunga, Mrs. Manohari Ramanathan, Mr. Chrisantha Perera and Mr. Nihal Fonseka for the constant interaction and deliberations at the Monetary Board. I am also grateful to Senior Deputy Governor Dr. Nandalal Weerasinghe, and Deputy Governors, Mr. K D Ranasinghe and Mr. C J P Siriwardena for their enormous support and for their highly professional advice and recommendations.

At the beginning of the year 2017, our country faced several challenges and uncertainties. Nevertheless, supported by the proactive stabilisation policy measures adopted by the Central Bank and the government, we have moved steadily towards achieving overall stability of the economy. But we do not want to be complacent with the achievements so far, and we acknowledge that several challenges continue to weigh down on the overall macroeconomic performance of the country. Therefore, we need to work hard in order to restore the stability of the economy on a permanent basis in order to create an enabling environment to raise the living standards of our people, and we believe that the policies outlined in the Road Map will help us in this endeavour. In the meantime, we require broad based reforms and commitment to enhance the country’s growth potential if we are to become an enriched nation as envisaged in the government’s vision. As the agent for macroeconomic stability, the Central Bank will always work hand in hand with the government to enhance economic growth through maintaining low and stable inflation and ensuring financial system stability. We believe that our future policy directions and actions set out in the Road Map will serve as guidance for you to plan ahead and to formulate and align your actions in line with broad policies of the economy. We would also like to note that we will be prepared to introduce new policies and measures not in the Road Map, as warranted by dynamic macroeconomic conditions and market developments.
Interpreting movements in market rates is, however, complicated by the fact that other factors influencing yields have not been constant. First, the recent run of UK data has been unusually strong relative to market expectations. That should generate upward pressure on market interest rates as, other things equal, a reduction in the degree of monetary stimulus would indeed become appropriate sooner if growth turns out stronger than expected. Bank staff have constructed a time series for the news in the incoming data by calculating, for 14 different data series, the deviation of the outcome from the market’s expectations (as recorded by the median expectation of economists polled by Bloomberg), normalised by its standard deviation. An aggregate timeseries measure can then be obtained by taking an (unweighted) average across the most recent observations for each series. Chart 6 shows such a measure back to 2006, together with analogous series for the United States and the euro area. The series for the United Kingdom recently reached its highest level over this period, emphasising just how much upside news there has been here recently. Moreover, although both the United States and euro area have also generally seen upside news of late, it has been nowhere near as strong as in this country. Market interest rates should therefore have been expected to rise, and by more here than in the other two jurisdictions.

Charles Bean: The UK economic outlook Speech by Mr Charles Bean, Deputy Governor for Monetary Policy of the Bank of England, at the Society of Business Economists Annual Conference 2013, London, 22 October 2013. *  *  *  Good morning! It is now more than five years since Lehman Brothers collapsed, ushering in the worst phase of the financial crisis, followed by a sharp and synchronised contraction in global economic activity. While growth was reasonable for the first year after output troughed in the middle of 2009, the pace of expansion since then has proved disappointingly weak. Just how disappointing is illustrated by Chart 1, which shows our August 2010 Inflation Report projection for GDP growth, together with the ONS’s present estimates of what actually happened. It is not a pretty sight. Whereas our central expectation was for a cumulative rise in output of 9% over the following three years, the actual rise is presently estimated to have been a miserable 2%. And we weren’t alone. The performance of other forecasting outfits was pretty similar. At a global level, a similar story can be told. The IMF has consistently revised down its projections for global growth. Back in October 2010, it was forecasting a cumulative expansion in output of 14% over the following three years, whereas the actual figure was just 10%. Indeed, the Fund has revised down its world growth forecast for 2013 in every subsequent World Economic Outlook: it now expects just 2.9%, against the 4.6% it projected three years ago.
He said: “I have come around to agreeing with the HKMA that it could not simply stand by idly and BIS Review 85/1998  -6-  watch the speculators and hedge funds create a vicious circle involving the stock market, the currency and interest rates. ... When the hedge funds become a pack and attack a country the way they attacked Hong Kong, they are engaged in destabilizing and essentially immoral activity. They are intent only on making profits for themselves at the expense of The People. The speculators cannot be allowed to rule the world, and the State must use the weapons it has against them when they attack.” May I also leave you with this question: if the authorities of the freest market in the world are pushed into controversial market intervention action, could it be that there is something seriously wrong with the international financial architecture? Paul Krugman in one of his articles in a recent issue of the Fortune magazine provides some insight into this question. He said that “speculative conspiracies against companies are effectively regulated; those against countries are not... Capital markets are global, but the institutions that support and regulate them - that allow them to work - remain national. It’s hard to imagine how truly global institutions could come into existence - how we could, for example, prosecute American traders working in London for manipulating some market in China.

Remarks on The Post-pandemic Landscape for Central Bank Statistics 11th IFC Biennial Conference Pablo García Silva, Deputy Governor, Central Bank of Chile August 25th 2022 I want to thank the organizers for the opportunity to participate in this distinguished panel, providing some remarks on the challenges we face as Central Banks and as providers of statistics, particularly in the environment we live today, as the pandemic recedes. Central Banks are keenly aware of the need to provide timely, accurate, and in-depth understandings of the changing economy. This not only to inform correctly policy making, but also to satisfy the shifting demands of society regarding the environment we live in. This inevitably implies trade-offs. Operative and budgetary constraints mean that a careful balance of timeliness, accuracy, and depth needs to be achieved. The ever-expanding complexity of economic relationships, and the speed at which policies have had to adapt to very large shocks, imply in my view that compared to a not so distant past timeliness is today at a premium. The times of change we live in require us to react promptly. This, however, carries the cost that both the accuracy and the depth of data will be inversely related to its timeliness. This brings about the implication that both policy making needs to consider the implicit uncertainty of the environment, and also that statistics providers need to be candid about those uncertainties when communicating with the public.
Petar Goshev: Macedonia – the crisis, its impact and future challenges Opening speech by Mr Petar Goshev, Governor of the National Bank of the Republic of Macedonia, at the XIV Annual Meeting of ACI Macedonia – The Financial Market Association, Ohrid, 26 September 2009. *  *  *  Ladies and Gentlemen, Honorable members of ACI – the Financial Markets Association It is an honor to open the fourteenth annual meeting of ACI – the Financial Markets Association held in a year of exceptional challenges for both the global financial markets and the financial markets in the Republic of Macedonia. I would like to address three issues, not for a moment forgetting the key word for a successful functioning of the financial markets – the trust. 1)  What are the reasons behind the current financial and economic crisis? 2)  How and to what extent has the financial crisis spilled over the Republic of Macedonia? and  3)  What are the challenges in the future period? At the beginning, let me address briefly the reasons behind the current financial and economic crisis. The financial crisis could also be compared with an illness of a human organism. In both cases, the finding of a cure first requires identification, and then remedy of the reasons that caused the illness, i.e. the crisis. Observing the events over the several recent years, the reasons behind the current crisis could be divided into two broad categories: macroeconomic and microeconomic.

Luis M Linde: Reflections on the planned Banking Union in Europe Address by Mr Luis M Linde, Governor of the Bank of Spain, at the First Bank of SpainOMFIF Economists Club Meeting, Madrid, 21 October 2013. *  *  *  Dear colleagues and friends, ladies and gentlemen: It is a pleasure to host this first Banco de España-OMFIF Economists Meeting. I am fully confident that it has provided an excellent opportunity to review and assess the latest developments in the Spanish and European economy and the present situation of the Spanish Financial System. I would like to share with you some reflections on the Banking Union in Europe which is, as we all know, a very important matter for the present European financial scenario. The thrust for the design of such a fundamental reform as the Banking Union in the economic governance of the European Union has come from the crisis, both international and European. The euro zone financial and sovereign-debt crisis has shown the shortcomings of the European institutional framework, triggering a wave of reforms that would, otherwise, most probably, not have taken place. Last year, the Presidents of the Council, ECB, European Commission and Eurogroup agreed on the milestones for building a new Economic and Monetary Union, based, in principle, on four blocks: the banking union is the first of those blocks, to be complemented, according to the political design, a later stage, with a fiscal union, an economic union and, finally, a political union.