samchain/econo-pairs-v1 huggingface dataset:
Given the fact that Iceland is not a member of the European Union, membership in EMU is out of the question. Nevertheless, the establishment of EMU will affect Iceland, particularly in the longer term. A few facts may be mentioned: first, the European Union is an important trading partner, but the absence of Denmark, Sweden and the UK from the EMU means that only about a third of our external trade is with EMU countries at present. Once the three countries join EMU, which we expect them to do, the share of EMU countries in our external trade will rise to above 60%. Second, we expect that our economic performance will be measured by the markets against the criteria developed for the EMU countries. Third, we expect that a successful EMU will bring beneficial effects to Iceland in the form of increased demand for our exports and reduced transaction cost in external trade. Fourth, it might become a greater challenge to operate our own currency. One could, for example, envisage that a currency like ours would be increasingly subjected to pressures from international investors seeking to diversify portfolios, adding currencies on the edge of the euro area and closely linked to it. This could conceivably lead to increased volatility and consequent potential instability down the road. The immediate effects on Iceland of the establishment of the EMU have not been significant. However, the entry of Denmark, the United Kingdom and Sweden into the EMU will markedly change our situation.

In 1996, both agencies raised Iceland’s rating by one notch and in 1997 Moody’s raised Iceland’s rating again and that time into the double A category, to Aa3. The short-term rating is A-1+ and P-1. Both agencies have assigned ratings to the long-term obligations of the Republic of Iceland in domestic currency, Aaa and AA+. The improved rating demonstrated a welcomed recognition of the progress made in Icelandic economic management in recent years. In our own view, the rating improvements were overdue, first because our economic performance was in quantitative terms fully compatible with that of countries with a higher rating than Iceland, and, secondly, because it seemed obvious that the reception of Icelandic borrowing operations in the markets indicated that financial institutions have consistently assessed Icelandic risk differently from, or one might say more favourably than, the rating agencies. Structural changes Other speakers at this conference will touch on structural changes in the economy, particularly in the financial sector. I only wish to emphasise that it is not an overstatement to say that the Icelandic financial system has undergone radical changes since the middle of the 1980s. The market was deregulated, a stock exchange was established, and new institutions and financial services flourished. Last but not least, all restrictions on the movement of portfolio capital between Iceland and other countries were removed as alluded to earlier. The market is now similar to that in other developed countries, except for volume of course, while the role of the government through ownership of financial institutions stands out.
In particular, as of September 22, the maximum bid limit per counterparty was raised from $ billion to $ billion, an overall size limit of $ billion per operation was imposed, and an auction process was introduced to determine the interest  13  Indeed, even prior to 2008, the range of fed funds trading on a given day could be quite wide, and the effective rate deviated significantly at times from the target rate for a day or two. This did not have any apparent effect on financial conditions or the economy. 6  BIS central bankers’ speeches  rate on the operation and allocate take-up when the sum of bids exceeds the new $ billion limit. 14 The $ billion individual bid limit was informed by evidence on the desired investments of counterparties that had bid at the previous maximum of $ billion, and it took into account the size of assets under management of our counterparties. For almost all counterparties, the $ billion limit is unlikely to be binding in any circumstances. The $ billion overall limit was above total demand observed over the first year of testing, with the exception of the operation conducted at the end of the second quarter of this year. So what are the benefits of moving from a structure with individual caps alone to one with an aggregate cap as well?

This means  BIS Review 44/2006  3  that we do not set interest rates merely to ensure inflation is on target as quickly as possible in all situations. It is very important to emphasise that the possibility to formulate monetary policy based not only on inflation prospects but also on how production and employment will develop has come about because the inflation target is currently firmly anchored in the economy. Everyone knows that we will adapt our monetary policy to attain the inflation target. During the years when the inflation target was new, confidence in the target was too shaky for the Riksbank to dare to give consideration to anything other than attaining the inflation target. However, flexible application of inflation targeting is nothing new if one looks at the monetary policy we have conducted in recent years, once confidence in our inflation target had been established. In practice, as I said, we do not aim to bring inflation back on target as quickly as possible in every situation. The Riksbank follows the principle of normally aiming to bring inflation back on target within two years after a deviation has occurred. It is primarily in situations where inflation goes in one direction and the real economy, i.e. growth, employment, etc. goes in the opposite direction that there may be reason to bring inflation back on target at a more gradual rate. Economists usually describe these situations as the economy suffering a supply shock.
Malta has also adopted the European Directive of 4th April 2001 on the reorganisation and winding up of credit institutions and their branches in Member States, which should facilitate the harmonisation of any eventual measures that may have to be taken in this regard. In compliance with EU legislation on the promotion of international payments, the Central Bank has meanwhile brought into force the Directive on Cross-border Credit Transfers. Another Directive, on Electronic Payments Services, which seeks to ensure a high level of consumer protection in the field of electronic payment instruments, came into force on May 1st this year. Looking forward, we believe that Malta’s financial system is well placed to benefit from EU membership. While the banks may face some challenges from increased competition, there will also be opportunities for growth. In particular, Malta is well positioned to serve as a bridgehead between Europe and North Africa, and some Maltese banks have already been exploiting this market niche, participating actively in the Mediterranean Bank Network set up after the Barcelona Declaration of 1995. The recent emergence of Libya on the international scene, a country with considerable potential with which Malta has long maintained close commercial ties, should also open up further opportunities in this direction. Malta’s inherent qualities, moreover, make it an attractive location. The island has a stable economic and political environment as well as a highly qualified and motivated workforce in the legal, accounting and consulting services professions and in banking and finance.

Central banks that also supervise core financial institutions would have the clear benefits of immediate access to vital information and expert assessment from supervisory staff about the health of individual institutions and their systemic implications. This could greatly help reduce the likelihood of any unnecessary delay or even misinformed decision that might hamper efforts to stem a financial crisis. For emerging market economies, the case for central banks to supervise the core financial institutions may be even stronger. This is because, financial markets in these countries are typically not well developed enough to serve as an efficient channel for the transmission of monetary policy. Market interest rates and even commercial banks’ prime rates react only sluggishly to changes in central bank’s policy rate, and often with a long time lag. In these circumstances, the traditional tool of monetary policy alone is unlikely to be enough to maintain economic and financial stability. Since in most emerging market economies, commercial banks are by far the most dominant players in the financial system, central banks with supervisory responsibilities could and should make use of targeted prudential policy to tackle financial imbalances and excessive asset price movements, both of which lie at the heart of all financial crises. This was what we did in 2003 to successfully contain incipient speculative bubbles in the property sector by imposing a ceiling on banks’ loan-to-value ratio of high-end housing loans.
Mervyn King: Banking and the Bank of England Speech by Mr Mervyn King, Governor of the Bank of England, to the British Bankers Association, London, Tuesday 10 June 2008. *  *  *  After a decade or more of economic stability, we are now facing a period of rising inflation and falling economic growth. Part of the reason for this change of economic weather is that we are passing through the most prolonged period of financial turmoil that most of us can remember. Whether, as the IMF has argued, it is the worst period of financial stress since the 1930s is too early to judge. After all, the crisis is not yet over. Since last August there has been a great deal of soul-searching about what we all might have done differently, both before and after 9 August when the crisis hit. And in circumstances where livelihoods are at risk it was inevitable that the “blame game” was played. Unfortunately, although such a game helped to fill newspaper columns, it generated more heat than light. So today I want to step back. Financial crises have been a regular, and disturbing, feature of our and other developed economies for as long any one can remember. They are as frequent now as in the nineteenth century, when Henry Thornton and Walter Bagehot were developing their ideas about how central banks could prevent instability in the banking system.

2014 is very different from the time of the Asian Financial Crisis in 1997 when Emerging Asia only accounted for 18% of global trade and 17% the World’s GDP. Today, Emerging Asia makes up of 25% of global trade and 28% of the world’s GDP. Moreover, the world has become so much more interconnected through the trade, FDI and financial market channels. It is all too easy to give too much credence to the “decoupling” theory than it deserves, as many people did when they over-rated the prospects of the EMEs when the advanced economies were having very difficult times after the eruption of the Global Financial Crisis. So the advanced economies also need to understand and watch out for the developments of the EMEs and their spillover effects. 5. Finally, I wish the Conference every success and all the participants a very pleasant stay in Hong Kong. Thank you. 2  BIS central bankers’ speeches
Whether or not a banking licence is required, stable coin issuers must abide by certain regulations just like any other financial market participant. These range from investor and data protection to rules on combating money laundering and terrorism financing. As you see, ladies and gentlemen, stable coins present many regulatory challenges, which in turn require close cooperation between the various authorities. This is particularly true of cross-border projects like Libra. In addition to the regulatory issues, there is the question of whether stable coins might influence the effectiveness of monetary policy. If Swiss franc stable coins were to proliferate in Switzerland, this would have no immediate impact on the effectiveness of our monetary policy. In such a scenario, the Swiss franc would remain the relevant currency. The stable coins pegged to Swiss francs would simply be another Swiss franc-denominated form of money alongside bank deposits and cash. As long as prices, wages and loans are set in Swiss francs, the SNB can influence incentives for savers and borrowers via its monetary policy and thus ensure price stability over the medium term. However, if stable coins pegged to foreign currencies were to establish themselves in Switzerland, the effectiveness of our monetary policy could be impaired. How close stable coins will get to good money and what additional benefits they will offer versus traditional types of money remains to be seen. What matters is that the various book and token money providers operate under identical competitive and regulatory conditions.

But there is much to suggest that fiscal policy as early as next year that is, the policy which is being decided this autumn - will be important in this context, at least if the timing that is now being discussed, with full participation in 2005 or 2006, is achieved. Thus, more and more of stabilisation policy's burden is transferred to fiscal policy. But this does not mean that the Riksbank should refrain from using the scope for monetary policy that may exist during the ERM2 period. It is up to the Riksbank to do what is possible to make Sweden's accession to the monetary union smooth and stable. Low and stable inflation in Sweden is one important element here; another is a stable exchange rate. Sweden must fulfil the convergence criteria in both these respects. In practice this means that there may be grounds for continuing to produce inflation forecasts and to publish Inflation Reports in much the same way as at present. We should also do what we can with the interest rate to direct inflation onto our target. But the closer we come to adopting the euro, the smaller will be our repo rate's effect on longer term interest rates. That is because as the entry date approaches, the Swedish yield curve will be increasingly determined by European interest rates. BIS Review 65/2002  5  The fact remains that exchange rate stability is one of the convergence criteria for Sweden's full participation in the monetary union.
The full-time employment model does not adequately address the profound changes in employment patterns, which economies are now experiencing, such as the increasing number of women in the workforce. Then again, most pension schemes are also designed for workers with full and uninterrupted careers. This does not reflect the experience of women, as we see more and more today, who may leave their jobs to become full time housewives or homemaker. Breakdown of marriage institutions, which is now not uncommon, and the fact that women typically outlive their husbands, place women at greater risk of being in poverty in old age unless pension schemes are adapted to meet their needs. Pension schemes must also take into account the changing work patterns in economies, which in the recent decade had seen an increase in part-time workers, the self-employed and temporary workers. 2  BIS Review 137/2007  The third challenge is in instilling public awareness on planning for retirement, particularly on having an appropriate level of retirement income to support retirees' healthcare and longterm care. A recent survey conducted in Malaysia revealed that more than 80% of Malaysians are either indifferent or not worried whether or not they have enough money for retirement. Only 34% are consciously saving regularly for retirement and an alarming 60% do not know exactly how much they need during retirement.

Amidst such challenges, there have been substantial reforms to pension systems in recent years to avoid systemic risks implications to financial stability and fiscal sustainability. Allow me to briefly outline the reforms undertaken by various jurisdictions. One of the most common features of reforms involves raising the age at which eligibility of benefits can occur. For some, especially in European countries, large tax increases were introduced as an alternative to address serious problems of financing pension benefits. In countries with severe demographic challenges, pension benefits were reduced by way of indexing benefits to wages and consumer price indices. Essentially, much of the pension reforms were focussed on reducing fiscal deficits. However, the impact of such reforms has achieved varying degrees of success and in some cases has been noted to have regressive effects. While it is not expected that all countries may make similar choices, striking a balance between maximising returns on pension fund investments and ensuring stable retirement incomes may result in trade-offs that could compromise other developmental needs. For example, poor investment returns on asset classes arising from funded pension schemes may require the Government to secure alternative funds to provide sufficient returns for the workers making such contributions. This could potentially stifle the development of other sectors in the economy. Moving forward, the challenge is to provide sufficient, affordable, sustainable and robust pension schemes.
The OECD’s Economic Outlook in May 2011 expected the robust growth to continue, with increases in real GDP of on average 3.3 per cent in 2010–2015. It was expected that the policy rate would need to be raised gradually as economic activity improved.6 A similar assessment was made by the International Monetary Fund (IMF) in July 2011. GDP growth was assumed to gradually decline to 3 per cent in 2014, when inflation was expected to amount to 2 per cent (measured in terms of the HICP). It was assumed that the interest-rate increases that had begun would need to continue.7 One conclusion I draw from this is that many unexpected events have occurred in recent years. The situation today is rather different than all analysts – both on the Executive Board of the Riksbank and outside the bank – were expecting at this time. I shall return to this later. Another conclusion is that the general picture was that the Riksbank’s policy was on the whole well-motivated and essentially based on traditional monetary policy deliberations. Although there were different opinions on exactly how high the repo rate should be, as there always are, the policy was thus not perceived as odd or conspicuous.

Neither the Riksbank nor any other analyst perceived the monetary policy conducted to be leaning against the wind to any large extent, and the general impression was definitely not that the repo rate should have been left at the level to which it was cut during the financial crisis, that is, 0.25 per cent. 4  In the minutes, Lars Svensson presents estimates where the dotted yellow repo-rate path is assumed to give an inflation rate of 2 per cent from the beginning of 2013 and onwards and an unemployment rate that would reach what he assumed to be an equilibrium level of 5.5 per cent at the beginning of 2014. It may also be worth noting that at the ensuing meeting, in September 2011, all of the Executive Board members thought that 2 per cent was a suitable level for the repo rate, given the economic situation in Sweden. 5  National Institute of Economic Research (2011). 6  OECD (2011), pp. 191–192. 7  IMF (2011), p. 25 and Table 9. BIS central bankers’ speeches  3  A strange assumption Given this, it is very strange to claim that an evaluation of the Riksbank’s policy should rely on the assumption that the alternative of not leaning against the wind would be to hold the repo rate at 0.25 until today. If no one perceived it as such at the time, it appears very strange to paint this picture retrospectively.
BIS Innovation Summit – 22 March 2022 Central banks in a DLT world  Speech by François Villeroy de Galhau, Governor of the Banque de France  Press contact: Mark Deen (mark.deen@banque-france.fr)  Page 1 sur 3 Ladies and gentlemen, It is a great pleasure and honour to give this opening speech of the second BIS Innovation Summit, which illustrates central banks’ commitment in new technologies, notably through the BIS Innovation Hub. Since their creation almost fifteen years ago, distributed-ledger technologies (DLTs) have evolved and opened up new possibilities, building alternative circuits and removing intermediaries, supporting new solutions and use cases. Are these disruptions as powerful as those brought by the invention of internet three decades ago? It may be too early to tell, but DLTs are expanding at a fast pace, and have the potential to bring about far-reaching changes. The invention of bitcoin, the first crypto-asset, stemmed from the desire to build a new “currency” – I emphasise the quotation marks here –, outside the remit of states and central banks. That was back in 2008, and what we have observed since then is that the use of bitcoin as a means of payment remains very marginal, because it does not feature any of the fundamental characteristics of currency. Nor is it a store of value, but rather a speculative asset, somewhat similar to the Dutch tulip bulbs from the 17th century.

The most disruptive feature of bitcoin was its underlying technology, which has since then been offered in different versions of DLT underlying various types of assets and uses. Second-generation crypto-assets now embed smart contracts that have led to the development of new services and products, the last being NFTs (non-fungible tokens). Among second generation crypto-assets, so-called stablecoins or backed-assets try to reduce their volatility by anchoring themselves to fiat currencies and sovereign assets. Still, they create fragmentation, and are fraught with regulatory and operational uncertainties. Here too there are historical precedents: free banking in the 18th and 19th centuries, when each private bank issued its own banknotes. It had major drawbacks, such as credit risk embedded in settlement assets. The introduction of central bank money as a common and safe settlement asset was a major breakthrough and since then has become the rule – in the best interest of all  Page 2 sur 3 economic agents. It is now a public good, and taken for granted at least in advanced economies. We, central bankers, have mixed feelings towards crypto-assets: on the one hand, they bring innovation and meet some expectations, especially in emerging economies; on the other hand, they carry significant potential risks, related to money laundering, breach of data privacy and high volatility among others. Although our mandates fully enshrine stability, resisting innovation is not in our DNA, on the contrary. Financial stability without innovation would mean conservatism; innovation without financial stability would feed distrust, and hence be unsustainable.