samchain/econo-pairs-v1 huggingface dataset:
changes in the relative prices of exports compared to imports: this is the theme of today’s conference. The subject chosen is highly topical, following the very sharp drop in commodity prices, in particular oil prices, between mid-2014 and early 2016, the effects of which on exporting countries had been underestimated, both by the countries themselves, but also by the international financial community. Thus, the economic growth forecasts for sub-Saharan Africa made by the main international organisations were revised downwards only very late. In January 2016, the IMF still expected Sub-Saharan Africa to grow by 4% in 2016 and by 4.7% in 2017, but the forecasts in the October 2016 global economic outlook were only 1.4% for 2016 and 2.9% for 2017, almost solely as a result of the recession in the oil economies. The Ivorian economy is another illustration of the importance of the terms of trade for economies focused on commodities. After experiencing exceptional growth over the last three years, partly driven by the good performance of cocoa prices, contrary to that of other commodities, activity appears to have slowed down, in the wake of the downturn in prices. The subject is also of major importance for central banks because the challenge here is to find how to implement appropriate counter-cyclical policies in the face of large-scale shocks that monetary policy cannot deal with either on its own or in the long run.

Public action should instead focus on improving the business climate, which is the only way to promote entrepreneurship in the formal sector and ultimately improve the country’s international attractiveness. Diversification is only sustainable if one avoids the Dutch syndrome, characterised by an excessive appreciation of the real exchange rate, restricting the growth of other export sectors. The accumulation of external savings contributes to this objective. Finally, the third priority concerns the robustness of the financial sector. I will emphasise the importance of measuring, via stress tests, the potential effects of a sharp drop in commodity prices on the solvency of the banking system. These stress tests make it possible to determine the adequate level of bank capital needed to withstand shocks. * * * Allow me to conclude briefly by expressing once again my gratitude to all the speakers and participants who came here today to share their thoughts on these crucial issues. I wish you fruitful exchanges and now give the floor to Patrick Guillaumont. Thank you for your attention. 3/3  BIS central bankers' speeches
Growth in public demand, stronger confidence in financial markets and low key rates are fuelling investment abroad. Even though the global economic situation now seems to have stabilised, there is still a risk of continued low growth for a fairly long period ahead. The severe downturn and fall in commodity prices has led to very low or negative consumer price inflation in many countries. Inflation is still moving down and is now negative in for instance the US, the euro area, Sweden, Japan and China. Core inflation is more stable, but has also shown a slight decline recently. The current low level of activity and high unemployment will also act as a brake on inflation in the period ahead. One characteristic of the crisis was the substantial increase in money market rates. Confidence between banks evaporated. Banks reacted by raising interest rates on loans to businesses and households. They started to turn off the lending tap. Measures implemented by central banks and governments have had a stabilising effect. The most important markets have also gradually become less disorderly, with less distrust among participants. The risk that issuers of credit will go bankrupt has diminished. Activity in money and bond markets has picked up and fluctuations are less pronounced. The situation in the interbank market has improved. The spread between money market rates and expected key rates, which is an indicator of risk premiums in the money market, has decreased. Money market premiums in Norway have also fallen. Equity markets have risen since early 2009.

This seminar will be a useful platform for constructive dialogues among the financial industry, infrastructure-related business sectors, and AIIB, to exchange views on the latest infrastructural development trends, and how we can harness the opportunities arising from the establishment and projects under AIIB. I shall now hand over the time to President Jin for his most anticipated speech. Thank you. 2/2  BIS central bankers' speeches
In Sweden, for example, in the past two and a half years the OMX index has dropped around 70 per cent. Coming as it did after the strong upward trend in the late 1990s, the fall is also unusually marked, with no parallels apart from the crashes in the early 1920s and after 1929. But as I shall be noting shortly, the current situation also differs in many respects from earlier periods of stock market turbulence. When an upward cyclical phase comes to an end, share prices normally fall back after rising for some years. The main difference today compared with earlier periods is the much higher valuations initially. There is a case for talking about the international bourses in the late 1990s in terms of a bubble. If we look at Standard and Poor’s index for the 500 largest companies in the United States, it is a fact that the level was the highest for more than a century. For an average share portfolio the historical price trend is approximately 16 times the company’s earnings. Early in 2000, however, the 500 largest companies were valued at almost 45 times the annual earnings. Valuations were far more inflated than just before the major crash in 1929. Although we do not have historical earnings data for the Swedish stock market to compare with the US figures, there are many indications that valuations here were also very high historically. The correction of share prices has admittedly occurred to the accompaniment of corporate scandals and security policy risks.

1 At the conference, Professors Carmen and Vincent Reinhart presented the results of a broad-based study of output growth and other economic variables during the ten years before and after economic crises (40–70 countries in connection with major global crises, and 16 individual country crises). 2 The findings are very clear: economic activity has a tendency to be much weaker in the decade after a financial crisis than in the decade beforehand. There are probably a number of explanations for this:  1  See http://www.kansascityfed.org/publications/research/escp/archive.cfm. 2  See Reinhart, Carmen M., and Vincent R. Reinhart (2010): After the Fall, http://www.kansascityfed.org/publicat/sympos/2010/reinhart‐paper.pdf. BIS Review 130/2010  1    GDP growth is often abnormally strong and, to a degree, unsustainable in the prelude to a financial crisis.   Financial crises are preceded by debt accumulation and followed by a long process of deleveraging.   Risk appetite subsides after a financial crisis, and what Keynes called “animal spirits” are tempered for a prolonged period of time.   Production capacity is destroyed in a financial and economic crisis.   Finally, economic policy becomes more complex, and there is more risk of error. Of course, these developments are not inevitable, and the ultimate outcome depends also on policy choices. For example, it is clear that a number of mistakes played a key role in shaping the disaster that unfolded following the crash of 1929.
4 For the various New York Fed Open Market Desk statements on the expansion of repo operations during March  2020, see Repo and Reverse Repo Operations. FOMC statements regarding asset purchases at this time include: Board of Governors of the Federal Reserve System, Federal Reserve Issues FOMC Statement, March 15, 2020; Board of Governors of the Federal Reserve System, Federal Reserve Issues FOMC Statement, March 23, 2020; and Board of Governors of the Federal Reserve System, Federal Reserve Announces Extensive New Measures to Support the Economy, March 23, 2020. The improvement in Treasury market functioning following these actions is discussed in Michael Fleming, Treasury Market Liquidity and the Federal Reserve during the COVID-19 Pandemic, Federal Reserve Bank of New York Liberty Street Economics, May 29, 2020. In the March 23 statements, the FOMC also announced it would start to purchase agency commercial mortgage-backed securities (CMBS) to smooth market functioning in that market that helps to finance multi-family housing. For more on the deterioration of CMBS market functioning, the Fed purchases and their impact on the CMBS market during this period, see Woojung Park, Julia Gouny, and Haoyang Liu, Federal Reserve Agency CMBS Purchases, Federal Reserve Bank of New York Liberty Street Economics, July 16, 2020. 5  A listing of the new facilities with links to additional information for each facility can be found at the Board of Governors of the Federal Reserve System website at www.federalreserve.gov/monetarypolicy/policytools.htm.

Let me show you the hidden side of Switzerland. You will see that modern Switzerland is adjusting rapidly to the changing reality of the world economy. Let's consider a few facts: •  With 7.5 million people, Switzerland is indeed a small country. Although we have no natural resources, we have a highly developed economy and a GDP per capita that clearly exceeds the European average. Contrary to the situation among some of our neighbours, our population is still growing, thanks to immigration. Our foreign population now represents about 20% of the total population and 25% of the labour force. Despite strong immigration, our unemployment rate – 3.5% – is relatively low. •  Switzerland remains a slow-growing country when compared to the United States. Our weak growth performance is due in part to the full employment, the relatively high level of personal income and the limited scope for domestic investment. However, in recent years, the Swiss economy has been doing better than its neighbouring countries in terms of growth and employment, and also in terms of price stability. Obviously, the fact that we are not a member of the European Union is not an obstacle to our development. •  Switzerland is increasingly becoming a service-producing country. The flagship of our service industry is the financial sector, which expanded markedly in the 90s and now accounts for 15% of our GDP – more than the machine tool industry and the chemical industry together.
Developing as an invoicing currency, for instance in energy markets or in the context of free trade agreements, would be important steps to gain a global role.viii Indeed, it would create the need to store euros for future trades, and consequently lead to the development of a full range of euro-based financial tools. 3. Safeguarding cross-border payments by technological advances in international financial infrastructures The euro area should remain on the frontier for cross-border payments, including the G20 agenda adopted in October 2021. The G20 roadmap for 2027 has indeed committed to bring profound improvements in this area including in setting ambitious targets on costs, speed, and accessibility of cross-border payments. But the challenge for all the stakeholders, central banks, regulators as well as the private sector, is to deliver and ultimately meet the expectations  Page 7 sur 7 of end-users. This remains a strategic priority for the Banque de France, which in parallel has paved the way for a more prospective solution: namely a wholesale CBDC that could be issued by the Eurosystem, deploying experiments such as the Jura project of cross border wholesale payments in coordination with the BIS and the Swiss National Bank. ** In the 1960s, US Secretary of Treasury Henry Fowler warned that "Providing reserves and exchanges for the whole world is too much for one country and one currency to bear." ix To Fowler, we answer: “We in the euro area are happy to help.” I thank you for your attention and I wish you a good forum.

i  Lagarde, C., Challenges along Europe’s road, speech, 11 May 2022 Villeroy de Galhau, F., The Eurosystem and its monetary policy: from an “impossible dilemma” to a possible roadmap for normalisation, speech, 6 May 2022 iii QJE paper by Fahri and Maggiori (2018) iv See the Council conclusions on achieving the EU’s economic and financial strategic autonomy in an open economy: one year after the Commission’s Communication. v Villeroy de Galhau, F., Capital Markets Union: unleashing Europe’s potential, speech, 30 November 2021 vi ECB report on RIE : only 60% of extra-euro area exports of goods were invoiced in euro in 2020 vii Recent research by Amiti, Itskhoki and Konings (2020) viii See the document Trade and investments in energy in the context of the EU common commercial policy ix Quote available here https://www.imf.org/external/np/exr/center/mm/eng/mm_sc_03.htm ii
Taking care of the large Nordic-Baltic “home market” First of all, we should keep in mind that the Nordic-Baltic region is characterized by considerable diversity: diversity in monetary policy frameworks, models of economic development and financial structures. The second key word of the Nordic-Baltic region is integration – the region is characterized by tight trade and financial ties within the region as well as with Europe and global markets. Therefore, the region’s competitiveness and growth potential are important to each country in the region. The bank groups that finance growth in the region are largely the same in every country. All these groups are currently highly rated and well capitalized in comparison to others in Europe. As a result of mergers and natural growth, the total assets of the larger banks have risen to a high level compared to regional GDP, not to mention their very high level as a ratio to the GDP of their home countries. The combination of common economic interests and financial sector integration has fostered the emergence of a unique feature of the Nordic banking groups: they have extended the concept of the “home market” well beyond their home country’s borders. For example, Nordic parent banks continued to provide liquidity to their Baltic affiliates even during the years of the deepest crisis in the Baltic economies. In today’s slow growth environment, it remains important for competitiveness and growth that there should be an appropriate level of financing in the whole region.

We need your answers in order to transpose PSD2 quickly and efficiently; we also need your active involvement in order to build the best possible RegTech. 2  2. What are the challenges for the French financial industry? Innovation does not just concern new entrants, of course. For banks as well as insurers, the digital revolution is disrupting traditional customer relationship models. One figure is particularly revealing: the level of footfall in high street bank branches. In 2007, 62% of French people visited their branch several times a month. In 2016, the figure had fallen to just a third of that: 20% – and to as low as 13% for the 18-34 age group.1 Customer journeys are becoming increasingly digitalised: France currently has the highest rate of usage among large European countries for internet banking services (69% of customers).2 But, beyond customer relationships, financial companies need to take a more comprehensive approach if they are to succeed in the digital transition - placing innovation at the heart of their strategic management, as well as rethinking their business models. These are difficult choices that naturally need to be taken by the companies themselves; the answers are not easy or uniform, but I would like to share with you a few avenues for thought.
Moreover, we may also allow holding of up to 40 percent of Turkish lira reserve requirements in foreign currency. Meanwhile, technical studies are underway for enabling a facility that allows holding of 10 percent of Turkish reserve requirements in gold. We believe that these three decisions will have positive impacts on our banks, especially through the cost channel. Consequently, the Turkish lira liquidity to be supplied to the market will significantly and permanently diminish the funding needs of our banks; thus, favorably affecting the banking sector via the liquidity channel as well. Now, I would like to talk about our reserve policy. Following the enabling of the facility that allows holding precious metal deposit accounts and a part of FX reserve requirements in the form of “standard gold”, starting from October 28, 2011, we expect to see a rise in Central Bank gold reserves from for the first time since 1991. Central Bank’s gold reserves may continue to increase once it holding of Turkish lira reserve requirements in the form of gold is  BIS central bankers’ speeches  1  also allowed. The Central Bank purchased USD 26 billion-worth of foreign currency between August 2009 and July 2011. These purchases were primarily aimed at prudently supplying FX liquidity to our financial system, when needed, in order to support both price stability and financial stability.

In this context, the CBRT will continue to monitor global economic developments closely and will take the required measures promptly to maintain stability in domestic financial markets. While formulating the monetary policy, we will continue to monitor fiscal policy developments closely as well. In this respect, our forecasts presented in the baseline scenario take the Medium Term Program as given and thus assume that fiscal discipline will be maintained. A revision in the monetary policy stance may be considered, should the fiscal stance deviate significantly from this framework and consequently have an adverse effect on the mediumterm inflation outlook. In the period ahead, monetary policy will continue to focus on price stability while preserving financial stability as a supporting objective. To this end, the impact of the macroprudential measures taken by the CBRT and other institutions on the inflation outlook will be carefully assessed. Strengthening the commitment to fiscal discipline and the structural reform agenda in the medium term would support the relative improvement of Turkey’s sovereign risk and thus, facilitate macroeconomic and price stability. Sustaining the fiscal discipline will  10  BIS central bankers’ speeches  also provide more flexibility for monetary policy and support social prosperity by keeping long-term interest rates permanently at low levels. In this respect, I would like to conclude my remarks by underlining that timely implementation of the structural reforms envisaged by the new Medium Term Program remains to be of the utmost importance. Thank you for your participation. BIS central bankers’ speeches  11
I am delighted to be here with colleagues from leading British investment banks and the London Stock Exchange: examples of UK financial institutions supporting the needs of global clients and delivering the type of open financial flows the global economy needs. Internationally the UK books more international banking business than anywhere else and over 40% of global foreign exchange and interest rate derivative business. We are also home to the second largest global asset management and fourth largest insurance centre. At the Bank of England, we want to support the financial sector to realise the full promise of new technology, so it is deployed safely and for the benefit of our people. We see our role as providing robust but dynamic regulation that is appropriate for emerging innovations. In June, we published a series of commitments setting out how the Bank could support the economy and the financial system of the future.1 We know that all of these action areas will benefit from collaboration with international partners and learning from international best practice. Today, I want to use this opportunity to explain what steps the Bank of England has taken in its approach to Fintech, and share a few lessons that we have learnt along the way. These lessons touch on the themes of openness and integration we have been discussing.

It is therefore important for our banks to continue the enhancement of the quality of the asset side of their balance sheets, bridging the gap with our European peers. European Banks are also facing emerging risks beyond the traditional business model risks I just mentioned. I will focus on the three I consider as the most prominent ones. The first one is the exposure to climate-related and environmental risks, which will be one of the main concerns for both supervisors and banks in the years to come. The transition to a green economy comes at a cost and this will affect the banks through various channels, the most prominent one being their exposure to businesses that produce high carbon emissions. It is therefore of paramount importance for banks to develop appropriate strategies and risk management practises to alleviate the longterm, direct and indirect, effects of climate change. From the regulatory perspective, we are conducting for the first time a climate related stress test for the Significant EU bank Institutions and we are also planning to carry out both on site and off site inspections to assess the readiness of the banks to deal with this type of risks. Let me be clear; both banks and supervisors are still on the learning curve with regard to climate-related and environmental risks. However, we both need to adapt and we need to adapt as soon as possible. The second emerging risk, is the IT and cybersecurity risk.