samchain/econo-pairs-v1 huggingface dataset:
At face value, these regulations could be expected to have contributed to bumping up demand for government bonds, thereby reinforcing the effects of the ECB’s APP. But because, as a result of our asset purchases, banks hold a large amount of central bank reserves, which count as highquality liquid assets, such regulations are unlikely to have been a key driver of increasing collateral scarcity. These reforms, however, are likely to have affected the repo market in different ways. One of them you can see on my next slide. Here I show the distribution of repo market activity for oneday tenor contracts exchanged bilaterally or via central clearing counterparties (CCPs) for German collateral. The chart shows an interesting feature, namely that the market attaches a premium to centrally cleared transactions. The reasons for this are unlikely to surprise you: the leverage ratio allows for offsetting cash proceeds to be netted off when the transactions are with the same counterparty, have the same end date, and are conducted in the same settlement system. This means that although repo transaction are not part of the 2009 Pittsburgh central clearing mandate, which covers OTC derivatives, centrally cleared transactions have a premium because they make those trades less capital intensive compared with non-nettable ones. According to MMSR data, around two-thirds of repo transactions are already cleared centrally.

Second, as can be seen on the next slide, increasing excess liquidity has led to a notable decline in the share of trades backed by general collateral (GC), which is traditionally used to obtain funding for cash management purposes. This may suggest that proceeds from the sales of securities, together with the ECB conducting its main refinancing operations at fixed rate full allotment, have increasingly acted as a substitute for funding in the interbank market. At the same time, we have observed an appreciable increase in collateral-driven or specific repos. You can see this on the right-hand side. In other words, repos are increasingly conducted as a means to move securities among market participants, not primarily to raise cash.6 There might be several reasons for this. Smaller inventories held by market-makers after the crisis, for example, may cause them to source bonds in the repo market more often. Alternatively, short-selling activity may have increased, a phenomenon often observed at, or close to, monetary policy turning points when investors expect yields to rise. One factor that is likely to have contributed to the rise in special repos is policy-induced scarcity, however. This can best be seen when considering the German Bund market. Here, our purchases have absorbed a multiple of net issuance in recent years, meaning that we have actively reduced the stock of outstanding bonds held by private market participants.
Since 2001, we have thus lowered interest rates more quickly and more decisively than the ECB. With inflation less than 1 percent, we enjoy price stability and our interest rates lie clearly below corresponding rates in the eurozone. A more homogeneous monetary system in Europe and a more stable international monetary order will help Switzerland to fully benefit from the present recovery of the world economy. 4  BIS Review 35/2004

Then I made the remark that a separated responsibility for monetary and macroprudential policy, without any coordination, could result in a game between authorities, which could lead to an outcome not desired by any of the authorities. In the United Kingdom, sole responsibility has been given to the central bank. A Financial Policy Committee is to be set up alongside the existing Monetary Policy Committee. Such a solution of course means that the coordination between these two almost parallel committees, although each with a different focus, becomes an important issue. In the EU, the European Systemic Risk Board (ESRB) has been set up at the ECB in Frankfurt. Central banks and supervisory authorities are represented on the ESRB, but the central banks have the majority of the votes when decisions are made. In Sweden, Finansinspektionen and we at the Riksbank set up the Council for Cooperation on Macroprudential Policy in January this year. This council will discuss the assessment of risks in the financial system as a whole and discuss appropriate risk-prevention measures. The Council will also discuss analyses and the development of tools and methods in the area of macroprudential policy. The Council is a temporary solution while awaiting a more permanent distribution of the responsibility for macroprudential policy. At present, the Financial Crisis Commission is working with this issue. The recently appointed inquiry on capital adequacy regulations will focus specifically on responsibility for the future counter-cyclical capital buffer.
Fiscal positions in Asia were far weaker than they initially appeared to be because of the enormous contingent liabilities that governments faced as a result of the collapse of the banking systems. This limited the room for countercyclical fiscal policy, although each government moved eventually to put in place modest fiscal stimulus. This diagnosis of financial vulnerabilities led to a very substantial improvement in the quality of national balance sheets in the region. More on this later. Exchange rate regimes and the perils of the middle A second, and closely related lesson, relates to the exchange rate regime. In the crisis countries, the exchange rate regime of choice had been a fixed but adjustable peg. This was softer than a currency board – the possibility of adjustment was built into the arrangement, but it was presented as a commitment to a fixed nominal exchange rate for an indefinite period of time. Although these regimes of limited exchange rate flexibility had been regarded as a means of achieving economic stability, in fact they turned out to be a source of instability. Nominal exchange rates against the dollar had been held fixed for some time, while real effective exchange rates had appreciated significantly. Because of weaknesses in the financial system, the investment booms of the previous decade had not translated into increased productivity. As investors grew concerned about potential weakness, pressure on the exchange rate further intensified until it became unsustainable. Exchange rate intervention proved ineffective.

Part of this is aversion to appreciation, and part of it aversion to variability in the exchange rate. In this sense, the high level of reserves today could be read less as an indication of fundamental strength than as an indication of the need for more progress toward completing the transition to a modern monetary policy regime. Even though reported inflation in most emerging economies has been moderate, the observed preference for nominal exchange rate stability suggests a monetary policy regime with less independence to sustain price stability over time. Emerging market economies have retained controls on cross-border capital flows, some quite comprehensive, some more selective. These come with a range of different justifications, from insulation against volatility and speculation, to protection of the domestic financial system, to limiting variability in the exchange rate or maintaining a specific objective for the level of the exchange rate. By design, these controls limit the degree of integration with the global economy and they necessarily distort incentives in ways that affect all economic and financial activity. Their appeal as a source of durable stability has diminished over time, and we now have a greater understanding of the effects they can have in lowering long-run growth potential. For policymakers in many emerging economies,  BIS Review 91/2006  3  the question is not whether to remove controls, but when and how to do it without significantly raising short-run vulnerability to financial instability.
19  10  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  10  Setting a target for the overall climate properties of the portfolio will help shape and steer our investment decisions, and provide transparency and accountability. At first sight, the framing of this target seems obvious: to achieve net zero by 2050. But 2050 is well beyond the likely lifespan of the CBPS. And ‘achieve net zero’ does not tell our staff which bonds to trade. So we need a nearer-term, intermediate, goal – in measurable units. The Discussion Paper considers a number of options (Chart 6). The first, a declining path for the carbon footprint of the portfolio, is simple to state and measure, and can be aligned with the Government’s target path to net zero. Implementing it at a more granular level is however complicated by the limited availability of appropriate sectoral pathways to net zero. Chart 6: Options for intermediate portfolio targets  11  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  11  A second, more forward-looking, approach would be to use an ‘implied temperature rise’ metric to target a declining temperature path. These convert data and projections of the current and future emissions of companies held in the portfolio into estimated future temperature levels, using assumptions about how those emissions compare to target paths.

3/3  BIS - Central bankers' speeches
In February the Riksbank introduced a new system which means that we publish a forecast for the repo rate together with a probability distribution. Previously the interest rate path has only been published in connection with the Monetary Policy Reports issued three times a year. But in September the Executive Board took the decision that the interest rate path and forecasts for certain key variables should also be published at the monetary policy meetings where no report was published. There are several advantages to the Riksbank publishing its own interest rate forecast. We can then explain more clearly to the general public and market agents how we view future interest rate developments, which makes it easier to evaluate monetary policy. Clearer communication should also mean that monetary policy becomes more efficient. Through the influence on interest rate expectations the Riksbank can to a greater degree influence interest rate setting in the economy. Another advantage of having our own interest rate forecast is that it becomes simpler to explain how we view the driving forces behind economic developments and also the objective and effects of monetary policy. At the same time, it should contribute to giving greater depth to the analyses and discussions of monetary policy conducted both within and outside of the Riksbank. Up to February this year, when I myself still worked as an analyst, I like many others tried to interpret the Riksbank’s communication and what it might mean for future interest rates.

My motives for the decision are expressed in more detail in the minutes from the meeting, so I shall not say very much on this point. The statistics received regarding developments in Sweden during the second quarter showed a slightly tighter labour market than we expected in June and unemployment was slightly lower than we were predicting (Figure 1). The hiring plans according to the National Institute of Economic Research’s business tendency survey for July also indicated that employment would continue to rise during the third quarter. At the same time, labour shortages in the business sector had continued to increase (Figure 2). I therefore repeated by view from June, namely that companies could be forced to increase their remunerations to obtain skilled labour. This could push up wage increases. If companies instead choose to lower their requirements regarding qualifications this could have an effect on productivity growth which would then risk being weaker than the development we envisaged. In both cases cost and inflationary pressures rise. According to the preliminary National Accounts, which were published in August, productivity showed much weaker development during the second quarter than we had predicted in June (Figure 3). But even if there was reason to believe that it would be short-lived, there is nevertheless considerable uncertainty regarding how productivity will develop in the future. And inflation, what has happened there? It had only been slightly higher than the forecast in June (Figure 4). However, companies’ costs had increased more rapidly than expected (Figure 5).
In this supportive international environment, the euro area experienced a brilliant first quarter of 2011, emphasizing the robustness of the recovery. GDP increased by 0.8% over the quarter but as fast as 1.5% in Germany and 1.0% in France. All euro area countries, except Portugal, enjoyed positive growth rates. These developments no longer reflect solely the economic policy stimulus and the inventory cycle; they testify to a broad-based recovery, with a self-sustained private sector dynamics. One remarkable development of this first quarter is that French and German growth has been mainly driven by private domestic demand and, in particular, business investment. In France, it grew at a 1.9% quarterly rate, posting a fourth consecutive quarter of strong growth. The pace of recovery may slow in the coming quarters. Business climate indices, such as the Purchasing Managers Index, the Economic Sentiment Indicator or Germany’s IFO, have peaked at high levels. Beyond these observations, the crisis may have left scars on our economies. Potential growth may have been affected. The balance sheet repair process, involving both public and private agents, may also weigh on growth in the medium term. Still, prospects are encouraging. The OECD, which recently issued its latest forecasts, has just raised its growth forecast for the euro area to 2.0% in 2011 and 2012. All in all, we have strong reasons to believe that we successfully exited the economic crisis. There are increasing signs that the recovery is now well on track.

Factors like certainty in government’s sector development plan, clarity in publicprivate partnership (PPP) framework, conducive legal, regulatory and institutional environment, and capacity to develop and implement projects are key to attracting private sector investors. ADB has an important role to play in capacity building, and through its interventions, catalyse reforms and assist governments to develop an environment conducive for private sector investment. Given the high degree of perceived risk of long-term infrastructure projects, public sector support is often needed to catalyse private sector investment. Provision of credit enhancements and guarantees as well as PPP are common modalities of public sector support, and more work should be done to find new and effective ways to catalyse private sector investments. We are glad to see ADB’s expanded efforts in mobilising private sector  BIS central bankers’ speeches  1  investment under Strategy 2020. With the support of ADB, the ASEAN Infrastructure Fund (AIF) established by ASEAN is expected to help mobilise private capital as well as the region’s foreign exchange reserves for financing infrastructure projects in the ASEAN economies. While the AIF is newly set up and more time is needed to observe the effectiveness of this model, the AIF represents a meaningful attempt by regional governments to cooperate and find new ways to mobilise public and private savings of the region to finance Asia’s own infrastructure needs. We encourage further efforts in this regard, and ADB, with its expertise and resources, is best placed to support such efforts.
Kevin Stiroh: Opening remarks at the GARP Global Risk Forum Remarks by Mr Kevin Stiroh, Executive Vice President of the Financial Institution Supervision Group of the Federal Reserve Bank of New York, at the Federal Reserve Bank of New York / GARP Global Risk Forum, New York City, 2 November 2016. * * * Good Morning. I’m Kevin Stiroh, the head of the Supervision Group at the Federal Reserve Bank of New York. I’d like to extend a warm welcome from the Federal Reserve Bank of New York, which is co-hosting the Global Risk Forum with the Global Association of Risk Professionals. I’d like to thank the many organizers of this meeting—as you can imagine, considerable time and resources went into planning this conference and that is what makes it so valuable for the participants and the risk management profession. First, let me state that my comments today are my own and do not necessarily represent those of the Federal Reserve Bank of New York or the Federal Reserve System. Looking Back at the Global Risk Forum When I was asked to speak at today’s session, I realized that it’s been five years since I served on the planning committee that developed the Global Risk Forum program in 2011. I wondered how our risk priorities and risk management issues have evolved over those five years as the world has changed around us.

2/3  BIS central bankers' speeches  Conclusion As risk professionals, it’s important to be forward-looking and to continually ask ourselves: are all risks being captured, measured, and monitored? What is missing? Are we focused on the right areas? So, here is another question: When we look back at this conference five years from now, what will we view as a major blind spot? I expect there will be issues that we will be surprised we missed, and part of the purpose of discussions like this is to lower the likelihood and impact of those inevitable blind spots. Thanks for your attention, and I’m looking forward to hearing the discussion throughout the day. 3/3  BIS central bankers' speeches
European Central Bank: Press briefing – transcript Transcript by Mr Jean-Claude Trichet, President of the European Central Bank, following the meeting of the Governing Council, Frankfurt am Main, 2 August 2007. *  *  *  Let me just say a few words and then I will be ready to respond to questions, as usual. Recent economic developments and survey indicators confirm that sustained economic growth continued in the euro area through the second quarter. Rising oil prices, emerging capacity constraints and the potential for stronger wage and cost dynamics, among other factors, imply upside risks to price stability over the medium term. The existence of upside risks to price stability at medium to longer-term horizons is confirmed by the strength of the underlying rate of monetary expansion: strong vigilance is therefore of the essence to ensure that risks to price stability over the medium term do not materialise. Both, our previous economic and monetary analysis as expressed in particular in the last press conference have been fully confirmed by the ongoing information we have received since the last meeting of the Governing Council. Let me also stress that we never precommit, we decide at the moment of the meeting of the Governing Council on the basis of the information that we have, facts and figures, and according to the judgement that we make at that moment. I re-emphasise that we never pre-commit.

The largest financial institutions are big players on these markets, which operate according to private and decentralised mechanisms. Total notional liabilities on OTC derivative markets rose from USD 72,000 billion in June 1998 to USD 88,000 billion at end 1999. The average daily turnover on these markets increased by 50% between April 1995 and April 1998. •  Users’ desire to improve efficiency has also driven the evolution in market structures. Planned links between stock markets, particularly in Europe, and the consolidation of delivery-vs-payment systems testify to these concerns. Domestic trading floors with regular working hours are gradually giving way to electronic international markets open around the clock. And the official trading systems of the various financial centres are in turn being challenged by private trading systems such as Electronic Communication Networks. Third: new demands for transparency and profitability in the financial industry Spurred on by this competitive pressure, the principles of corporate governance and value-adding have taken root, in particular under the impetus of fund managers. These principles force players to meet new requirements in terms of transparency and profitability. Such requirements encourage participants in the global market to adopt new investment behaviour, in particular with the spread of index-linked management or massive recourse to leveraging. These objectives also result in the use of fairly homogeneous risk management techniques, such as the definition and use of limits, risk management with value-at-risk models and the development of stress testing.
A higher repo rate with then be needed in order to keep inflation close to the target. Conclusion Today I have spoken about the situation in Sweden and abroad: partly about our dependence on events abroad and partly about what we ourselves can do to smooth the course of development in the Swedish economy. I have previously described the crisis in the early 1990s like this: “Things were quite OK abroad, but Sweden was not OK”. At the time of the crisis in 2008 the situation was the opposite: “Things were not OK abroad, but Sweden was OK”. Recent developments abroad have been marked by great uncertainty. Sweden is highly affected by this uncertainty. With the help of monetary policy we can do all that we can to promote a stable development of the Swedish economy: that is ensure that inflation stays close to the target and that the development of the real economy is as stable as possible.

The US  2  BIS central bankers’ speeches  economy was in many senses the epicentre of the financial crisis. There are a number of problems that need to be dealt with. First, many households in the United States have fallen into difficulties because their debts exceed the value of their homes. The households have therefore needed to increase their saving, which they have done. As a result, private consumption has grown slowly for some time but does have the potential to recover in the period ahead. Second, public finances are weak in the United States too (see Figure 9). The situation became more dramatic in the summer when the country’s credit rating was reduced. The political deadlock in the US Congress was one of the main reasons for this. A major advantage in the United States is that, so far, government bond rates have remained very low (see Figure 2). However, it is important that these problems are resolved so that this positive trend can continue and so that interest rates do not begin rising as they have done in several countries in southern Europe. There are, however, a number of bright spots with regard to the US economy. One is that the companies are making good profits. We have to go all the way back to the early 1950s to find as high a level of profits in relation to GDP as there is now. When confidence returns there is therefore every chance that investment and employment will recover.