samchain/econo-pairs-v1 huggingface dataset:
How do banks in Hong Kong measure up in terms of environmental issues? As an international financial centre, Hong Kong provides a base for a number of multinational banks that have developed detailed environmental policies and procedures. In the case of local and regional banks, I would say that environmental issues are less highly articulated. This is why I welcome this conference and the involvement in it of the Hong Kong Association of Banks. It is not my purpose in this speech to anticipate the more detailed advice that subsequent speakers are going to offer. But I would like to offer a few general recommendations that banks should take into account in dealing with environmental issues. First, banks should keep themselves informed about international and regional initiatives on the environment, particularly those that directly concern financial institutions. In this connection, I would draw the attention of those institutions that are not already aware of it to the work of the United Nations Environment Programme (“UNEP”). This is the main UN institution that deals with environmental questions. As part of its work, it has established a Financial Institutions Initiative on the Environment which is a partnership between UNEP and leading banking and insurance companies to promote sustainable development and environmentally sound business practices. The basic role of the Initiative is to promote the integration of environmental considerations into all aspects of the financial sector’s operations and services.

One point that is particularly relevant to banks that finance companies or projects in countries like China is that the rules of the environmental game can change very quickly. The authorities in China are getting serious about cutting emissions and pollution, as the requirement by the Beijing Municipal Government on the Shougang Steel Group to cut back its output has shown. The problem in China is that regulations are not always strictly enforced. But this can change overnight, resulting in major compliance problems for the companies concerned and increased risk for the banks that have lent to them. Hong Kong banks which lend into China would therefore be well advised to keep this in mind. Finally, banks should pay close regard to their own “corporate ecology”. Banks can contribute to environmental protection by the way in which they manage their use of resources in their own operations. In this way banks can be responsible corporate citizens while at the same time reducing business costs. The type of measures that can be adopted include saving on energy consumption, recycling of paper, waste management, purchasing environmentally friendly products and use of video conferencing to cut down on unnecessary travel. Use of office automation such as email can also help to reduce the consumption of paper, provided of course that staff can be encouraged not to print out the messages.
Not only was the size of the output gap significantly mis-measured – with real-time estimates subsequently revised up by some 3–4 percentage points – but, more importantly, even the sign of the gap was wrong. This example is not just an aberration: large errors are inherent in the concept of the output gap. And worse still, at the critical moments when policymakers need to understand what’s  1  See Potential Output from a euro area perspective (ECB Occasional Paper series No 156, November 2014). BIS central bankers’ speeches  1  happening in the economy – in the build-up to and aftermath of crises – measures of output gap are often at their least dependable. 2 So that poor track record in the run up to the crisis is one reason why I’m sceptical of finetuning. But there’s also a second one: such difficulties are only likely to increase given current trends in the economy and society – and not just in estimating potential output, but in measuring actual output too. 3 We’re living through an era where the nature of production and consumption is changing rapidly. And that has profound implications for our ability to understand the economy – or, at least, our ability to adequately measure what is actually being produced and how efficiently this is achieved. Consider, for example, the difficulties that the digital economy creates for measuring labour input.

This, in my view, is a major challenge for all of us in the financial community. The second major challenge to the Thai economy is how to cope successfully with volatile global financial markets and an appreciating baht. This challenge is the more pressing of the two. Let me explain why. Thailand, like many emerging market economies with a small and shallow financial market, is particularly vulnerable to fast-moving international capital. Such rapid movements of capital flows, if vastly out of line with our ability to absorb it, can have negative impacts on the export or import sectors, depending on the direction of the exchange rate movement. In our case, the recent surge in speculative capital inflows caused a rapid one-way appreciation of the baht relative to regional currencies. The appreciation momentum hardly reflected our economic fundamentals. Left unchecked, it could have presented a clear threat to growth and stability – beginning with export, a current engine of growth, trickling down to the real sector, and eventually harming financial stability. In dealing with currency appreciation, the prevailing wisdom of "letting the market work" has been given a chance. Yet the baht kept rising against almost all major and regional currencies at an alarming speed. Letting such rapid appreciation work itself out could have entailed significant risks to our agriculture sector, which employs nearly 40% of the labor force, and small and medium-sized firms in the labor-intensive manufacturing sector. We recognize that the real sector needs to adjust.
This was the result of weaker cyclical developments in the world economy and a sharp drop in interest rates internationally. In addition, the Norwegian business sector has felt the effects of the high Norwegian cost level and the strong krone exchange rate. Public agencies have also had to adapt activities as a result of last year’s wage settlement. The weak prospects abroad and at home have in turn had an impact on the Norwegian labour market and the outlook for wage growth and inflation in the years ahead. The mandate implies that the interest rate must be adapted to the outlook for the Norwegian economy. If it appears that inflation will be higher than 2½ per cent with an unchanged interest rate, the interest rate will be increased. If it appears that inflation will be lower than 2½ per cent with an unchanged interest rate, the interest rate will be reduced. Normally, this orientation of monetary policy will also contribute to stabilising output and employment. The impact of monetary policy occurs with a lag. The current inflation rate does not provide sufficient information to determine the level at which interest rates should be set now. Our analyses indicate that a substantial share of the effects of an interest rate change will occur within two years. Thus, two years is normally a reasonable time horizon for reaching the inflation target. The interest rate influences inflation indirectly via domestic demand for goods and services and via its effect on the exchange rate.

Jarle Bergo: Monetary policy and business cycles Speech by Mr Jarle Bergo, Deputy Governor of Norges Bank (Central Bank of Norway), at Kunnskapsparken Bodø, 25 September 2003. The text below may differ slightly from the actual presentation. The address is based on the assessments presented at Norges Bank’s press conference following the Executive Board’s monetary policy meeting on 17 September and on previous speeches. The Charts in pdf can also be found on the website of the Norges Bank. *  *  *  The operational target of monetary policy as defined by the Government is inflation of close to 2.5 per cent over time. The inflation target provides economic agents with an anchor for their decisions concerning saving, investment, budgets and wages. The inflation target also provides a framework for monetary policy’s contribution to stabilising output and employment. This intention is also expressed in the Regulation on Monetary Policy. High demand for goods and services and labour shortages normally point to higher inflation. When interest rates are increased, demand falls and inflation is kept at bay. When demand is low and unemployment rises, inflation will tend to slow. Interest rates will then be reduced. Norges Bank sets the interest rate so that future inflation will be equal to the inflation target of 2½ per cent. The interest rate has been reduced since December last year in response to the change in the inflation outlook.
Figure 6 World inflation (*) a) Headline inflation  b) Core inflation  (annual change, percent)  (annual change, percent)  U.K. U.S.  10  10  Latin America Eurozone  8  8  6  6  4  4  2  2  0  0  -2  -2 00 02  04  06  Eurozone Latin America  U.K. U.S.  00 02 04 06 08 10 12 14 16 18 20 22  08 10 12 14 16 18 20 22  (*) For Latin America, the simple average of annual inflation of Brazil, Colombia, Mexico, and Peru is used. Sources: Statistics bureaus of respective countries. 13  Figure 7 Waiting times at Chinese ports (average wait, in days)  3.5  China  Shipping costs (1) (index, 2018=100)  1,400  Shanghai  Commodity prices (2) (index, 2018=100)  From China to the U.S. From China to Europe  1,200  3.0  Natural gas Oil (3) Wheat Metal index (4)  250  1,000  2.5  300  200  800  150  2.0 600 1.5  100  400  1.0  200  0.5  0 20  21  50 0 18  18 19 20 21 22  22  19  20  21  22  (1) Rate for transporting a 40-foot container on the respective routes. (2) For natural gas and wheat, one-month futures are used. (3) WTI-Brent average. (4) S&P GSCI Industrial Metals. Source: Bloomberg.

A key element for the convergence of inflation to the 3% target within two years is that the significant imbalances that accumulated in the economy in 2021 are further resolved. In the central scenario, in 2022 and 2023 the economy will grow below potential, with the activity gap narrowing gradually and remaining negative for some quarters. This will be compounded by a slow reduction in the international prices of fuel and foods from their current levels and a declining real exchange rate (RER), but still remaining above its averages of the last 15 to 20 years (figure 11). It is important to note that this projection does not consider changes in the structural parameters of the Chilean economy, which we are currently updating and will make available later in the year. The liquidity that remains from the stimulus measures adopted in 2021 will continue to sustain consumption in the immediate future. However, most fundamentals suggest that it would weaken in the second half of the year. In the labor market, job creation continues, but has slowed down compared to previous months and with lower real wages, in a context in which the unemployment rate remains below 8%. The financial conditions faced by households have tightened, because of both higher interest rates and stricter credit requirements. Accordingly, coinciding with the effects of inflation on households' purchasing power, consumer expectations have deteriorated sharply in recent months, with worsening perceptions of employment, inflation, and purchases of goods.
In periods, inflation will deviate from the target while output will also deviate from potential output. A successful monetary policy provides the economy with a nominal anchor and contributes to stabilising the economy. This reduces the uncertainty associated with future inflation. Conclusion Assessing uncertainty is an important part of the central bank’s communication strategy. An explicit forecast for inflation, output and the interest rate, in addition to assessing uncertainty in the forecasts, is intended to enable economic agents to better understand the central bank’s intentions in its interestrate setting. When the economy is exposed to disturbances, agents will have a basis for predicting the central bank’s interest rate response and helping to ensure that market interest rates move in the right direction, thereby increasing the effectiveness of monetary policy. Norges Bank has in recent years taken a number of steps towards greater transparency in monetary policy. The strategy intervals are published at the beginning of the period to which they apply. Each monetary policy meeting is followed by a broad review of the most important factors underlying the interest rate decision. The use of the Bank’s own forecasts for the interest rate path in the Inflation Report can be viewed as a further step towards increased transparency with regard to the basis for monetary policy. Thank you for your attention. BIS Review 6/2006  7

Evidently the supervisor’s aim must be to ensure that the banking sector is a fortress against the storm and not an added problem that we have to face at the worst time imaginable. 1  Recently, it has been frequently said that the banking sector is in much better shape than it was before the previous crisis. This will allow it to become part of the solution. In any event, crises are, by definition, periods of transition and COVID-19, despite its specific features, will be no exception. I believe this crisis will serve as a catalyst which will speed up many of the trends that we have already seen and discussed on many occasions at our meetings. First, as regards the importance of digitalisation. Second, in respect of the need to gain in efficiency and cut costs. Also, naturally, as regards the criticality of good governance and risk control, underpinned by the best international practices which will allow institutions to react appropriately to such changing circumstances. And, above all, regarding having a sound and sustainable business model for the medium and long term. We do not know what the future holds for us, but what we do know is that the better prepared we are, the better we will fare. Before I conclude, let me apologise for not having made the most of this address to introduce a supervisory “wedge”.
The credit default swap premium indicator, showing the markets' concern for the banks' solvency, which according to many experts is the most significant individual diagnostic statistics, started to decline. Especially the CDS premium (commercial debt securities premia) dropped significantly. The progress with the guarantees, although gradual, is also encouraging, with more banks issuing bonds even without utilization of guarantee (government) being registered. The LIBOR spread also shrunk, and it is expected to "continue to narrow gradually compared to the period before the measures were undertaken" (this primarily pertains to England). Many banks continue to face with deleveraging and rebalancing in order to lower the dependence on financing through the central banks. The stronger capital and financial position of the banks will be possible in a period of several years. In wider terms, the financial system remains to be under acute clench, tension. The real economic sector bears the consequences. The unemployment increases. The business financing is getting harder and more expensive. The economies' growth decreases. Also the so-called emerging economies started to feel decline in the growth. It seems that we are entering into recession. The central banks of the developed economies transfer the focus of their measures from the inflation control to recession prevention. BIS Review 18/2009  3  What conclusions can be derived from this crisis? 1.

•  Neither macroeconomic nor sector imbalances, of which I have spoke before, must be tolerated for too long. •  The banks' risk management processes and procedures must be dramatically improved. This includes revision of the existing limits on the  BIS Review 18/2009  banks' exposure to certain risks, improvement of the stress-testing procedures and elimination of the weaknesses related to risk management which arise from the investments in structural financial products. We, as National Bank of the Republic of Macedonia, have adopted new regulations related to these issues and we continue to work on that with our banks. •  Strengthening of the principles for liquidity risk management, especially in crisis. Internationally, steps have already been undertaken. In April 2008, FFS prepared a Report and defined 67 activities for strengthening the markets and the resilience of the institutions. The Report pays special attention to liquidity, and on September 28, the Basel Committee on Banking Supervision announced the new Principles for Sound Liquidity Risk Management and Supervision. The responsibility is located with the banks and supervisors. We, as National Bank, have already passed new regulations for defining the main elements which the liquidity risk management system of each bank must incorporate. The aim is to ensure level of liquidity which the banks will be able to use as source for covering. •  The transparency of the operations of the financial institutions must increase through the type and the scope of the data these institutions will disclose.
According to the government bill, the Riksbank should support the objectives of general economic policy with the aim to achieve not only high employment but also sustainable growth. However, the idea is hardly that there is any conflict between sustainable growth and high employment. The Riksbank writes at the beginning of every Monetary Policy Report that, in addition to stabilising employment, it also endeavours to stabilise production around a long-run sustainable development path. Nor is the idea here that there is any conflict between stabilising production and stabilising employment around a long-run sustainable path. However, in practice, the estimation of a sustainable path for production in addition to a sustainable path for employment requires assumptions about and estimates of sustainable average working hours, sustainable total factor productivity and a sustainable path for the capital stock. These assumptions and estimates introduce such large sources of error, and such a large degree of arbitrariness in a sustainable path for production, that in practice such a path provides no guidance for monetary policy. It is better to focus on stabilising unemployment around an estimated long-run sustainable rate. To estimate the long-run sustainable unemployment rate is not easy, but it is much easier than estimating a long-run sustainable path for production. Estimates of the long-run sustainable unemployment rate can also be examined and evaluated, while estimates of a long-run sustainable path for production will in practice become more or less impossible to verify. With regard to specifying price stability, what measure of inflation should be used?

Criteria 3, 4 and 5 introduce conditions that cannot easily be observed. We have to apply judgement. The criteria contribute to consistency and structure the discussion. The Riksbank also applies judgement when selecting the interest rate path. But Svensson does not discuss possible shortcomings in the macroeconomic model. In Chart 10, he shows how the various interest rate paths, differing by around ½ percentage point in the period to summer, could result in differences in the inflation rate of close to 4 percentage points as early as next autumn. Monetary policy seems to be having a very strong impact. It would be interesting to hear whether he thinks that relying so heavily on such a model in interest rate setting is robust, and how possible errors in the model should be guarded against. We also know from experience that market participants’ perceptions can differ from ours, particularly somewhat further ahead. There can be a variety of reasons for these differences and Svensson discusses a number of them. It would also be useful to study the volatility surrounding publication of key macroeconomic variables. We would prefer to see lower volatility around monetary policy meetings, and that any surprises are postponed to a time closer to the publication of new macroeconomic data. Solberg Johansen (2008) – winner of the Bertil Ohlin prize for best thesis in international economics at the Stockholm School of Economics – examines volatility in the yield curve.
EU integration is the future we want and we as a National Bank continuously invest in improving our capacities to comply with EU central banking standards. Focusing on payment systems only, major steps were taken toward harmonization of the Macedonian legislation with the EU regulation. The new Law on Payment Services and Systems and related bylaws which are under procedure will implement PSD and part of the provisions from PSD2, Settlement Finality Directive and E-money II Directive. The NBRM took an important step toward harmonization with the EU regulation in the oversight area by adopting new oversight regulation which is in line with the Principles for Financial Market Infrastructures, as well as the ECB’s revised oversight framework. Further on, domestic payment statistics was adjusted in accordance with the ECB Regulation providing methodological and operational compliance with the payment statistics of the European System of Central Banks. Another major project was completed recently linking the domestic payment system with TARGET 2 via Banca d’Italia. This project is expected to contribute to reducing the gap between fees for cross-border payment transactions and domestic payments, which is in line with the EU Progress Report recommendations and the ECB’s Needs Analysis Report for the National Bank of the Republic of Macedonia from 2013. In the period ahead, we will continue to further strengthen capacities enabling the NBRM to successfully join the European System of Central Banks, and later the Eurosystem once the Republic of Macedonia achieves its strategic commitment for EU membership.

These costs would have had to be included in order to provide a complete overview of society’s total costs related to the payment system. Users’ participation in the production of payment services does not necessarily have a positive impact on society’s overall efficiency in the production of payment services. Increased use of e-invoicing will, however, increase the efficiency of electronic bill payment. The survey does not cover the payees’ costs related to invoicing. BIS Review 66/2002  5  8. Price developments 1993 - 2002 Paper-based services  Electronic services  2001 NOK  4 2001 NOK  40  3.5  35 Giro cash  30  3  Giro at the counter  25  Telephone giro  2.5  20  2  15  1.5  Cheque  10  EFTPOS  PC/Internet giro Direct debits  1 Mail giro  5  0.5  0  '02  20 00  98  96  94  '02  98  20 00  96  94  0  Both developments in the use of payment services and research show that prices affect customers' use of different payment services. Despite the price increase for most paper-based services, the weighted average price per transaction, at constant prices, has fallen since 1994. 9.