samchain/econo-pairs-v1 huggingface dataset:
Since mid-January this year, the SNB’s monetary policy has been based on two complementary pillars: The negative interest rate and our willingness to intervene on the foreign exchange market as required. These instruments are proving effective at countering excessive pressure on the exchange rate, thereby ensuring price stability in the medium term. However, I would like to stress that, at current levels, the Swiss franc remains significantly overvalued. With an interest rate of –0.75% on sight deposits, we have gone far compared to most other countries. We have observed that money and capital markets are functioning smoothly under the negative interest rate. However, mortgage rates have not fallen to the same extent as interest rates on money and capital markets. Hence, fears that the negative interest rate  3  Jordan, T. (2015) “The impact of international spillovers on inflation dynamics and independent monetary policy: the Swiss experience”, conference paper prepared for the 39th Economic Symposium on ‘Inflation Dynamics and Monetary Policy’ in Jackson Hole, 28 August 2015. BIS central bankers’ speeches  5  could contribute to imbalances on the mortgage and real estate markets have so far proved unfounded. Finally, economic conditions remain challenging in Switzerland. The SNB monitors the situation continuously, and our latest analysis and forecast will be published at the next monetary policy assessment on 10 December. In general, we believe that the economy has returned to a moderate path of recovery, although significant downside risks remain. These originate, in particular, from the fragile international environment and exchange rate developments.

Douglas Elliott has made the point that we entered the crisis at a point in the history of economic policymaking where we had abandoned all macro tools other than the use of interest rates, the price of money. This was fairly unprecedented. We had lost confidence in quantitative tools in monetary policy, and the role of reserve money had been diminished. We had very little in the way of bank liquidity policy, of which holdings of reserve money are an important part. The experience of the crisis tells us that we have to keep working hard to re-develop these tools and to knit large firm supervision into the picture. In my experience, it doesn’t happen naturally. This brings me to the fourth and final thought on supervision. It was absolutely essential and natural that the immediate reaction to the crisis was to re-build regulation and supervision in respect of the core prudential All speeches are available online at building blocks, which are solvency (capital) and liquidity (funding). And, we had work to do, and still have, to get these core elements into better shape. And the work of interpreting these standards will never stop because the precise forms of risk taking will evolve. But, when I have stepped back and looked at the causes of the crisis in firms, another thing stands out.
Correspondent banks are also heavily dependent on the use of cross-border payments messaging through the network maintained by the Society for Worldwide Interbank Financial Telecommunications (“S.W.I.F.T.”) to advise and confirm payments. To provide some sense of the magnitudes involved here, consider that the Fedwire and CHIPS systems process a combined $ trillion in funds transfers on an average day (split roughly evenly between the two systems). While S.W.I.F.T. itself does not transfer funds, its messaging network carries over three million messages per day relating to financial transactions worldwide. The many interconnections of the global financial market infrastructure imply that financial market participants in the United States could be affected by Y2K-related disruptions in other financial markets. In assessing the scope of any such potential problems, we should be realistic in accepting that some disruptions are inevitable, while also recognizing that not all countries confront Y2K problems of similar magnitudes. The problem simply affects too many organizations and too many systems to expect that 100 percent readiness will be achieved throughout the world. Nor are the best efforts of supervisors and regulators capable of completely eradicating the risk of disruption. Ultimately, the work of fixing the Y2K problem rests with firms themselves, and even some of the most determined and well-funded Year 2000 efforts may miss something.

Accordingly, the Joint Year 2000 Council plans to issue a statement in the near future providing general support for the concept of a national-level coordinating body for the Y2K problem. In the United States, of course, the White House has established the President’s Council on Year 2000 Conversion, headed by John Koskinen. This effort, as well as those of this committee under the leadership of Chairman Leach, and of the other Congressional committees that have addressed the Y2K problem, has shown that national government bodies have a very important and useful role to play in encouraging progress in addressing the Y2K problem. Turning now to the question of how financial supervisors can implement effective Y2K programs, the Joint Year 2000 Council intends to promote the sharing of strategies and approaches. For example, the Basle Committee on Banking Supervision has prepared a paper containing “Supervisory Guidance on Independent Assessment of Bank Year 2000 Preparations”. This document is aimed at moving supervisors worldwide from a level of general awareness to a specific, concrete program of action for overseeing Y2K preparations, both on an individual bank basis and on a system-wide basis. The Joint Year 2000 Council intends to adapt this paper for use by financial market regulators and supervisors more broadly and to issue it as rapidly as possible with the endorsement of all four Sponsoring Organizations. The goal will be to provide guidance in developing specific Year 2000 action plans for all types of financial market authorities.
Admittedly, low productivity gains can be explained in terms of the intense employment generation in the economy and of a composition of growth which, in recent years, has been largely based on construction and on services. But they nevertheless reflect low productive investment, a limited incorporation of technological improvements into the stock of productive capital and the relative lack of competition in certain segments of the economy. BIS Review 39/2004  5  Safeguarding a sound competitive position for the Spanish economy is undoubtedly a priority for economic policy management within EMU. As I have said, the activities most exposed to foreign competition have begun to feel the effects of the losses in competitiveness that have built up. And after squeezing their margins in recent years, they have begun to adjust their staff levels. Competitive pressures are heightening, moreover, as new competitors emerge on the international scene with a similar specialisation pattern to Spain and with a notable edge due to their low labour costs. In particular, the enlargement of the EU to 25 countries, while entailing the opening up of potential new markets for Spanish products, means above all a substantial increase in competition. The Spanish productive system must prove itself able to respond to this with dynamism, innovation and flexibility, as it has in the past when opening up to its external environment. The second source of risk lies in the patterns of financial behaviour of the private sector of the economy.

As pointed out in the Annual Report, it is particularly important to push ahead with labour market reform (in the areas of wage negotiation and hiring), improve the workings of the housing market (and of the related land market) and continue with the liberalisation of the network industries. Measures are similarly required to foster the incorporation of technological innovation in productive processes and to improve the stock of infrastructure and of public capital. The current house price situation means that urgent action is needed to overcome the restrictions on the supply of land via more flexible town planning to make building land more readily available and to improve the workings of the rental market. Finally, although the improvement of the services sector depends on many structural considerations, the importance of more flexible retail trade regulation for price formation and the economic system’s overall efficiency should not be overlooked. In short, without making any attempt to cover the entire scope of the economic policy requirements in the present situation, I do feel it is important to emphasise that fiscal stability and structural reforms can provide an appropriate means of addressing risks arising in relation to competitiveness and to the growing indebtedness of the non-financial private sector, which are the ones that could jeopardise the continuity of real convergence. Financial system 2003 brought an improvement in the situation of the international financial markets and, in this favourable setting, the financial institutions of a good number of countries reported better results and higher profitability.
We assumed therefore that growth in the world economy would be somewhat weaker in 2008 and 2009. In Sweden on the other hand, economic activity was somewhat stronger than expected. Nevertheless, it was assumed that the weaker prospects for economic activity internationally would lead to a slowing down of growth in Sweden as well later this year and early next year. Signs of this slowdown were already beginning to appear, for example in the data in the National Institute of Economic Research’s Economic Tendency Survey and in the statistics on retail sales and new job vacancies. Our assessment, however, was that the slowdown in Sweden would be relatively moderate. GDP growth remained good, and the potential for future growth was still relatively favourable. The level of saving among households and in the public sector was high. Property prices were fairly stable and the direct effects of the financial turmoil were expected to be relatively slight. BIS Review 68/2008  1  At the same time, inflation was high both in Sweden and abroad. This related above all to higher energy and food prices on the world market. Inflation expectations in Sweden also remained high, and were also way above the inflation target even in the longer term. We thus had to take various counteracting factors into account. On the one hand, growth in the Swedish economy was still good and both inflation and inflation expectations were high.

Monetary policy cannot respond to temporary upswings in inflation that can be expected to subside quickly, as monetary policy acts with a time lag. Raising the interest rate to counteract temporary inflationary impulses could cause unnecessary costs. And here I mean costs in the form of production and employment falling too much. However, monetary policy should react to price impulses that would otherwise risk having lasting effects on inflation. As I have mentioned earlier, monetary policy both in Sweden and abroad is facing a severe challenge. On the one hand, the fact that oil and food prices have recently shown a rapid upturn, both in the world market and in Sweden, means that inflationary pressures have increased substantially. This implies that the interest rate should be raised. On the other hand, our most recent growth forecasts indicate that international growth will be weaker, or at least in the United States and the euro area. There is a risk that this will also subdue growth in the rest of the world. In addition, the upswing in oil and food prices risks further dampening world growth. Domestic demand is a strong driving force for growth in many developing countries and it may be weakened by the large rises in food prices. But US growth is also highly dependent on domestic consumption, which can be negatively affected by the high oil price. All of these factors would instead indicate that the interest rate should be cut. 2  International perspective, no. 15 2008, LRF, the Federation of Swedish Farmers.
Although monetary policy is aimed at an inflation target, developments in the real economy and the labour market have considerable significance for the shaping of monetary policy. For one thing, total demand is one of the most important determining factors behind the inflation rate, and for another thing, taking the real economy into account can in certain cases mean that exceptions are made to the 1 fundamental monetary policy rule. This applies in particular in the case of supply shocks: Firstly, inflation can be allowed to be higher or lower one to two years ahead, when due to factors that are not considered to have a lasting effect on inflation, and secondly, the real economic costs of a rapid return to the target level are considered to be excessively high. For example, we had particular reason to observe certain temporary changes at the time of our most recent repo rate decision. The Riksbank believes that energy prices will fall back from their present high levels without the rise spreading to other prices. Another circumstance that affected our forecast was the crisis in Iraq, which has now become a war. The geopolitical situation overshadows the more normal inflationary risks that we usually observe. I shall return in a moment to the economic situation and give you my views of developments. Potential growth affects the Riksbank’s assessment When the Riksbank makes its assessment of inflation in the coming one to two years, we look first and foremost at resource utilisation in the economy.

The forecasts in the March Inflation Report indicate an average rate of increase in CPI inflation of approximately 1.0 per cent one year ahead and 2.0 per cent two years ahead. What inflationary risks can we see ahead? There is, of course, a risk that the higher energy prices will push up costs in other parts of the economy and thus have contagion effects. They can also affect inflation expectations and thereby wage trends. We have ahead of us wage bargaining rounds in the autumn, which will affect two million employees and will play an important role in future economic developments. The main risks for inflation below target level are connected with the uncertainty regarding international economic developments. In the euro area in particular there are problems that could lead to weaker economic developments than we are currently expecting to see. The risk spectrum for inflation is thus considered to be balanced on the whole. However, it is above all the geopolitical situation that is currently creating unease and uncertainty and poses a threat to the global economy which is very difficult to estimate. The uncertainty currently prevailing in the global economy makes it more difficult than usual to interpret various economic indicators and to predict future developments. Personally, I believe it quite possible that the consequences of the war will be both more prolonged and more costly for the global economy than is assumed in the main scenario of the Inflation Report.
It is of paramount importance that the school put in place measures to avert rampant vandalism. Ladies and Gentlemen, let me also mention here that the challenges I have just outlined are not only common to Mumbwa High School, but are experienced in many Government schools. We also realize that the Government has limited resources and cannot attend to the problems of every school in the country at one time. It is for this reason that the Bank of Zambia has continued to donate used computers to several schools around the country. In 2009, the Bank donated a total of 60 computers to various schools including Mumbwa High School, David Kaunda Technical High School, Information and Communications Technology Ladders, and St Francis of Assisi in Lusaka. We are hoping that through these donations the beneficiary schools will sustain and improve the academic performance while bridging the digital divide. Further, a number of schools including our own Mumbwa High School do not have internet access to enable teachers carry out their research activities. In order to improve performance in class, we need to ensure that we enhance the capacity of our teachers. We must recognise that computers alone are not magic and neither should they replace chalk and blackboards, but they should and can be used as a tool to aid learning. Providing more computers at schools will do little without providing the tools that enhance teaching and research like internet.

The Central Bank’s decision to liquidate the bank was challenged in the Court of Appeal which quashed the Central Bank decision on the ground that the Central Bank had not followed the due procedure given in the Banking Act. Finally, the Government as a part of political decision in the interest of depositors bailed out the bank by vesting the bank with a new state bank set up for the purpose. If the Central Bank was conscious of its responsibilities, it could have resorted to a different path to resolve the bank at the very early stage. World over, central banks are blamed for delayed action, not effective to resolve problems. World over, regulators fall behind the market although they are expected to correct the market. Regulators are burdened with laws, procedures and bureaucracy and lack of latest market information. They work for office hours. However, market participants work 24 hours and are innovative for regulatory arbitrage. The human greed supported with moral hazard of regulation creates bubbles cyclically leading to financial and economic crises from time to time. The regulators and politicians create new laws, but they fail to prevent the next bubble. As a person being in both regulator and markets, I will do a lot of work to address this 6  BIS central bankers’ speeches  universal issue hopefully. However, as financial regulators cannot control the greed, financial bubbles and crises are to happen. Finally, the Central Bank independence is the confusing and very technical subject. No Central Bank is divine.
We nevertheless have reasons to cheer: in 2021 around EUR 100 billion were invested in the European technology ecosystem, almost three times the previous record of 2020, with around 100 new unicornsi. Furthermore, although technologies have not yet shown their full potential in terms of productivity, we may be at a turning point with the latest advances in artificial intelligence, biotechnologies or telework-related reorganisations - after a lag which corresponds to the process of appropriating these technologies by the economic fabric (investment, training, etc.). Page 7 sur 9 These disruptions are also reflected in the monetary, financial and payments spheres – which we scrutinise as central banks and supervisors –, where digitalisation is bringing about a triple revolution – and it is far from over: (i)  First, the arrival of new players: new actors born from the tech world – Fintechs and Bigtechs – are challenging historical players with radically new approaches to financial services and at present much less regulation;  (ii)  Second, the emergence of new assets: crypto-assets from the blockchain universe in the form of tokens: they will never according to me be credible as “crypto-currencies”, but could be used as settlement means – think of stablecoins for instance;  (iii) Lastly, the emergence of decentralised market infrastructures: new technologies tend to reduce the use of proven centralised settlement systems. These revolutions offer the potential for increased market efficiency while reducing costs and time.

G7 2019 Conference – Banque de France, 10 May 2019 Cybersecurity: Coordinating efforts to protect the financial sector in the global economy Conclusion by François Villeroy de Galhau Governor, Banque de France  Press contact: Mark Deen (mark.deen@banque-france.fr). Page 1 sur 6 Ladies and Gentlemen, First, I would like to thank the moderators and the panelists for their very rich comments and the very useful ideas. We are all convinced that cybersecurity of the financial sector will remain on our agenda for a long time. The challenge is no longer about gaining awareness anymore, but to find ways to intensify and rationalise our action. Based on the discussions today, let me start with one pre-requisite – coordination - and then propose concrete steps and tangible actions to improve our coordination in three areas: I. Regulation and supervision; II. Information; III. Preparation. A. Global threats, coordinated action Panel 1 questioned the importance of cyber threats for the financial sector. There is a consensus that the level of cyber threats has never been so high, but at the same time, we must acknowledge that the capacity to anticipate attacks needs to be reinforced. Following an attack, we need to address the potential contagion issues to the entire financial system or the entire economy. This is why coordination is a pre-requisite, not an easy one but a necessary one. While remaining realistic, there will not be a “world organization for cybersecurity” for obvious reasons, including trust. Hence, coordination should be cross-jurisdictional.
20 Sorting out these unusual risk premia effects is crucial for conducting appropriate monetary policy and for communicating the monetary policy stance to the public and to market participants. 18  John B. Taylor, 1993, “Discretion versus Policy Rules in Practice”, Carnegie Rochester Conference Series on Public Policy 39, December, 195-214. 19  For a discussion of various types of the Taylor rule see Athanasios Orphanides, 2007, “Taylor Rules”, Finance and Economics Discussion Series 18. Federal Reserve Board. 20  Taylor, 1993, p. 198. 6  BIS Review 141/2007  3. Conclusion  Let me conclude by reiterating that much of the central banks' motivation for their involvement in financial stability is rooted in their role as providers of liquidity in general, and of emergency liquidity in particular. At the same time, it has to be recognized that central banks have a very limited arsenal of instruments to deal with crises situations. A change in the level of official target interest rate is in many ways a crude instrument that, in my view, is best deployed with a firm focus on trying to keep the economy where our statutory mandate tells us to keep it. This does not, of course, preclude a change in interest rates in the event of a crisis, but only to the extent that the risks from the crisis to the economy justify a change in policy. The current market turmoil is providing countless lessons to the industry as well as to the official sector.

As central banks, we need to consider carefully to what extent instant transparency with regard to liquidity operations may end up being counterproductive. Let me add here that this is a very complex issue. I am not arguing that the evolution towards greater transparency in central banking should be reversed. Indeed, perhaps we need greater ex ante transparency such as clearly stated conditions and eligibility criteria associated with central bank liquidity provisions. Undoubtedly, ex post transparency about potential liquidity support measures must also be guaranteed. But in the midst of a crisis, it may well be beneficial and desirable for central banks to have some flexibility with regard to how they communicate regarding potential liquidity operations. 2.2. Implications of volatile risk premia for the conduct of monetary policy  My second tentative lesson directly relates to the conduct of monetary policy. The recent market strains are unusual because confidence or rather the lack of confidence plays such an important role. Clearly, there is a great deal of uncertainty regarding valuations of complex credit instruments. Moreover and arguably more importantly, banks realize that they are facing or could face large contingent liabilities. They are therefore doing everything they can to protect their balance sheets. In essence, banks are hoarding liquidity and are reluctant to lend money in the interbank market beyond the very short term. As a result, a substantial and highly unusual risk premium has emerged in the interbank market.