samchain/econo-pairs-v1 huggingface dataset:
Conform to institutional commitments, the Bank of Albania has regularly contributed to reporting according to respective chapters of the acquis communautaire, reflecting the progress achieved on the approximation of Albanian regulatory framework to EU legislation and attainment of European standards. With regard to Bank of Albania’s activity, the EC in its Progress Report of October for Albania, inter alia, commented positively that the monetary policy has successfully helped in keeping inflation stable and the banking sector remains well-capitalised and liquid. Implementation of the EU-funded Twinning Project of the Bank of Albania with the Bank of Italy in partnership with the Bank of France started in 2011. This project, which covers the major part of Bank of Albania’s activities, will help in enhancing institutional capacities, approximating the regulatory framework and work practices of the Bank of Albania to those of the EU and ECB, as well as promoting the development of financial market and instruments at home.   Promoting payment system  Fulfilling its legal responsibility for a smooth functioning of payment systems, in 2011, the Bank of Albania actively worked to strengthen the payment systems oversight, improve the technology infrastructure and develop new payment products in Albania. Both main payment systems, AIPS (for settling large-value payments) and AECH (for settling and clearing small-value payments) operated with full efficiency, reflecting the stability of the systems.

The sharp price increase in international markets and its rapid pass-through to domestic consumer prices in early 2011, led to key interest rate rise by 0.25 percentage points in March. Such a move aimed at anchoring inflationary expectations and preventing second-round effects on inflation, against the setting of projections for further international price increases. Over the second half of the year, upon moderation of inflationary pressures and inflation’s falling back within the target, as well as upon the shifting of expected inflationary pressures balance downward, the monetary policy became strongly stimulating. The Bank of Albania carried out two consecutive key interest rate cuts, taking the key interest rate in the economy to the lowest historical level (to 4.75%). The stimulating policy through the key interest rate was accompanied by continuous liquidity injections into the financial market. Overall, the monetary policy pursued in 2011 and the sluggish demand for public sector financing helped in controlling the risk premia, leading to lower financing costs and increased financial intermediation in the national currency. The latter was also helped by a change to the required reserve instrument, by means of which the foreign required reserve remuneration was abrogated. It aimed to discourage foreign-currency intermediation and improve the monetary policy transmission mechanism. The issue of financial euroization in Albania will continue to be on the focus of the Bank of Albania’s monetary policy in the future. 4  BIS central bankers’ speeches  ***  3.
It sets out: our assessment that a digital pound issued by the Bank of England is likely to be needed; the next phase of work necessary to enable a firm decision to be taken in the future on whether to implement the digital pound; and consults on the model we now propose to develop. The consultation will run for four months and end on the 7th June 2023. The Bank and the Treasury will then review the responses and consider whether changes to the proposed model are necessary. We will publish our response to the consultation. We will then engage with private sector firms and other stakeholders on the next stage of work. This will include technological experimentation, particularly through collaboration with the private sector on proofs of concept[17]. This work will support the feasibility of the proposed model, the refinement of the associated technical requirements and the development of a technological blueprint for the digital pound. Such a blueprint will provide evidence that will allow us to evaluate the feasibility and costs of developing a digital pound. This will be the keystone of our assessment of whether or not to proceed to build. We have made no decision yet on whether a digital pound would use DLT. Our technology working paper sets out high-level requirements for a ledger, and makes clear that in principle these could be fulfilled by conventional or DLT technology. But it is clear that experimentation with DLT, whether private or public, will be important to ensure it is appropriately considered.

Private commercial banks issue predominantly digital money in the form of electronic transfers between bank deposit accounts[3]. Page 4  We have seen major changes in recent years in the form of use of money to make payments. In the mid-1960s, most workers were paid weekly in cash, and around 70% of the population did not have a bank account. [4] Very few had access to credit or debit cards. Consequently, for every £ of funds that people held to make payments, over a third would be held as cash. Nowadays, less than 5% is held as cash. Even 15 years ago, 60% of transactions in the UK used physical cash; pretty much everyone in this room would have carried enough for everyday transactions. In 2021 only 15% of transactions involved physical money. Technology and the increasing digitalisation of everyday life has transformed the way we use money. Private commercial bank money accounted for 85% of the payments made by the public. Within that, debit and credit card transactions accounted for 69% of transactions. Contactless payment has made such transactions much easier for everyday life. And the growth of internet commerce has required the use of digital money. It is always challenging to forecast how technological advances and social trends will play out. Few at the turn of this century would have predicted the development and growth of a massive and dominant market and social platforms.
The third type of criticism is that monetary policy has recently been unclear and difficult to understand. Inflation targeting’s most important contribution But before I move on to the different types of criticism, I would like to dwell a little longer on the situation twenty years ago. When analysing the inflation-targeting regime, I believe that it is important to remind oneself of the situation when it was introduced. Why was there such strong support for defending the krona, even though it meant high interest rates in the middle of a recession? What were the problems policymakers were so anxious to resolve? As I have already mentioned, the recession in the early 1990s can be regarded as a setback following an excessive credit expansion, similar to the situation in many European countries today. The regulation of the Swedish credit market was phased out in the mid-1980s. Combined with a tax system that encouraged borrowing and an overly expansionary stabilisation policy, this contributed to creating a property market bubble. When the bubble burst in the early 1990s, it led to a banking crisis. As this coincided with an international economic downswing, the recession in Sweden was particularly severe. But there was also a deeper and more fundamental problem in the Swedish economy at that time. Sweden had been caught up in what might be termed a devaluation cycle since the early 1970s. Fixing the exchange rate is equal, at least in theory, to setting a target for domestic inflation.

If problems arise in parts of the financial system, operators can find alternative sources of credit. A larger bond market would enhance financial stability. This is also the case in Norway. New investment and risk management instruments Structural changes and strong growth over the past decades have led to more perfect financial markets. This has made the markets more efficient and improved the distribution of resources and risk between operators, sectors and regions, and over time. There is rapid growth in product development in financial markets, and trading in instruments for the transfer of credit risk is rising. Greater focus on risk management by banks and other operators generates demand for these products. The emergence of new instruments is being driven forward by intensified competition, technological developments and new, more risk-based capital adequacy requirements. In many countries, there has been a tendency towards separating those who provide loans and who assess and price the risk, from those who take over the loans and bear the risk. Through securitisation, banks can sell entire loan portfolios to special purpose vehicles that issue bonds that are collateralised by these loans. It is the buyers of these bonds that bear the risk. Such special purpose vehicles are not subject to capital adequacy requirements or supervision. Asset-backed bonds are a similar instrument where bond holders have collateral in loans that banks have transferred to a mortgage company. Mortgage companies are subject to supervision and capital adequacy requirements. Efforts are being made to allow these instruments in Norway.
Real interests display an upward trend in countries with high public debt stock, whereas they are low in countries with modest public debt stock. High public debt stock and concerns about the sustainability of public finance cause a direct rise in risk premiums and this leads to high real interests rates. Although tough measures had been implemented several times prior to the 2001 crisis, strict discipline could not be established in public finance and the public deficit was mostly met by borrowing. Hence, along with the operations conducted in the banking sector after the 2001 crisis, the ratio of net public debt stock to national income recorded its highest level of 91 percent in 2001. In fact, many developing or developed countries can attain this ratio in the long run. However, until recently, sustainability of public debt had been a considerable problem on Turkey’s agenda. This problem derived from the size of short-term debts, high real interest rates and doubts about policies that were being implemented at the time. We targeted a high primary surplus comprising the 6.5 percent of the national income and reached our goals in the framework of the stability program, which has been implemented for the last three years. The same target has been set for the year 2005, as well. Thus, the commitment to continue the programme of tight fiscal policy has been strengthened. As a result of these achievements, significant developments were made in public debt dynamics in the last three years.

At this point, it is important to underline once more the damage caused by high inflation in order to remind us why should do everything in our power to stick to the price stability objective. This is especially important in an environment where the benefits of overcoming inflation are not yet fully understood. The consequences of failure to maintain price stability, in other words, the damage caused by inflation, can be clearly seen in our country both in society and in the economy, as is the case in all countries that have experienced high and chronic inflation. High inflation, one of the main reasons for poverty, depravation, unfair distribution of income, and the economic instability environment it creates has been one of the most influential impacts of inflation on society. The legacy of inflation on poverty, depravation and the unfair distribution of income have been clearly felt by society. Another effect of high inflation, which manifested itself in the short-term in society, is that of immoral behavior. High inflation led to moral corruption in our country. While Turkey ranked low in fields such as infrastructure, education, health and the fair distribution of income in international development indicators, it ranked high in indices of corruption. Another factor worth mentioning in this context is the relationship between high inflation and political instability. Shortsighted policies by political instability and the resulting inflation as a result have  BIS Review 36/2005  1  featured several times in economic literature.
It is the one Forum in which regulators come together with finance ministries, central banks and the international financial institutions, specifically to look at financial stability issues, and how they should be resolved. In its first four years, the FSF has made some progress. Its work on Offshore Centres certainly led to improvements in regulatory standards in a number of those centres. And it has stimulated both the securities and insurance regulators to work more quickly, and in a more determined way than was previously the case. I have first hand knowledge of that impact. But more could be done. It remains difficult and slow to agree priorities between the Forum’s membership. I also think it could usefully take a somewhat broader view of its responsibilities. The Forum could do more to co-ordinate the activities of the sectoral international regulators and to contribute to their priority-setting. It could use its privileged links with the G7 finance ministers to bring more political impetus to the work of the bodies represented on it. IOSCO and IAIS, for example, have no other structural links to ministers, or to central bankers. The Forum is well placed to identify weaknesses in regulation, whether in member states or internationally. This would not involve duplication of effort, as some fear, rather the addition of urgency and focus to work already under way.

Monetary policy is not immune from the complexity of the real world. For instance, some unconventional policies may have had unintentional distributional consequences by pushing up asset prices, hence benefiting some households with important financial wealth. On the other hand, fostering economic recovery and reducing unemployment goes in the direction of helping the most vulnerable part of the population. In other cases, strong intervention may raise legitimate moral hazard concerns. Should Central Banks have refrained from acting at the risk of not fulfilling their mandate? Those simple questions remind us that decision making always involves some tradeoffs. It is all the more important that policy makers keep a clear focus on their ultimate objective. Central Banks should do their utmost to avoid any undesirable allocation or distribution effects of their policies. Those policies should be designed as neutrally as possible. This being said, the possibility of unintended side effects should not paralyze decision making when required by the situation in order to fulfill their mandates. The Eurosystem has faced such a situation when deciding on its program of large-scale asset purchases. I believe the decisions taken reflect an appropriate balance between the necessity of achieving the mandate and the desire to avoid undesirable side effects. Key principles underlying the implementation of the PSPP have been the minimization of unintended consequences and full neutrality, as illustrated for instance by the choice of the capital key to allocate purchases between various Governments debts.
It recommended a fixed timetable for meetings between Chancellor and Governor and for the announcement of decisions on interest rates. Many of the recommendations were carried over to the independent MPC that followed. The optimal time for meetings was thought to be the end of the first week of the month, and with minor changes the timetable of a two-day meeting culminating with an immediate announcement of the decision at noon on Thursday was adopted within a couple of weeks. The key difference was that a purely advisory committee would not have published minutes of its own deliberations – only the minutes of the meetings between the Chancellor and Governor would have been made public – and voting was not an agreed feature of such a committee. My predecessor – Eddie George – was informed of the new and enhanced role for the Bank early on the morning prior to the announcement – a Bank Holiday Monday. Returning from the tennis court, I received a call from Eddie asking me to meet him in the Bank as soon as possible. That was the last I saw of the sun for quite a time. We sat in his office with a sense of excitement that now we really did have a chance to show what the Bank of England and price stability could do for this country.

Such was the adrenalin flow that at one rehearsal a row broke out about how a decision would be reached if the Committee split three-ways in equal numbers. Needless to say, such an eventuality has not occurred.1 But all was resolved and the show opened on Wednesday 4 June. At that first meeting the MPC raised interest rates by 25 basis points, as it did at its two subsequent meetings. A decade is a long time for any show to run. How has it fared? On the face of it UK macroeconomic performance has improved with the creation of the new monetary framework. The MPC arrived on the scene midway through what I have described as the nice (non-inflationary consistently expansionary) decade, and continued into the not-so-bad decade.2 Since the MPC was set up economic growth has averaged 2.8% a year – a little above the post-war average rate – and there has not been a single quarter of negative growth. The average deviation of inflation from target has been just minus 0.08 percentage points. Let me stress that the Committee does not dwell on the past. But an important question for all of us is whether our new found stability will persist. That is not a new question. On the tenth anniversary of the MPC we should remember that this is also the fiftieth anniversary of Harold Macmillan’s famous claim that we had “never had it so good”. But let me remind you too of the full text of his remarks.
Interbank market rates soon reflected the last key interest rate cut and the yields on government debt securities continued to drop. The falling interest rates were mostly reflected in the deposit market rather than in the credit market, signalling a more conservative bank approach to lending and a savings-oriented real sector. Monetary indicators have performed in line with the developments in the real economy and the monetary inflationary pressures remain low. Money supply decelerated its growth rates further in January to 4.9%. The slowing money supply has reflected the low business and household demand for borrowing, and the lower budget deficit financing from the banking system. The annual growth of lending to the economy continued to decelerate to record lows of 2.1% in January. The poor performance of lending is evidenced in all categories and currency denominations, both for businesses and households. *** The new available information does not alter our baseline projection for the performance of the economy over the current year; however, it evidences a shift in the balance of risks to the downside. The Albanian economy is expected to grow at low and below-potential rates, reflecting the slowing external demand, poor consumption and private investment and a positive fiscal stimulus based on the planned budget for this year. Against a background of a negative output gap and in the absence of global market and liquidity pressures on the Albanian economy, the inflationary pressures are expected to remain low.

The prices of those assets fell, and markets closed for a range of complex credit instruments. As I said two years ago, “risk premia have become unusually compressed and the expansion of money and credit may have encouraged investors to take on more risk than hitherto without demanding a higher return. It is questionable whether such behaviour can persist”. And, as we have seen, it hasn’t. The re-pricing of risk that is still continuing is not a process that we should try to reverse. Adjustment to this has been painful for banks in the major financial centres in two ways. First, with some asset markets closed, banks found funding more difficult. Some needed to finance loans they had made but had then expected to package up and sell. Others needed to finance off-balance sheet investment vehicles that were no longer able to fund themselves. At the outset of the crisis, banks were concerned to protect their liquidity position. But increasingly, attention has turned to a second, more fundamental concern. As a range of asset prices fell, banks began to report large losses. Uncertainty about the scale and location of losses led to concerns about the adequacy of bank capital and hence the ability of the banking system to finance continued economic expansion. At the end of last year, sentiment in financial markets worsened markedly. So in mid-December, central banks around the world announced a co-ordinated set of actions in money markets.
This design worked incredibly well, as activity in most of the facilities gradually declined to near zero, allowing the Fed to simply turn them off with no market disruption. Overall, central banks were able to accommodate the most extreme shift in the demand for liquidity that has been seen in a generation, and to do so in ways that responded to the specific needs that arose in a market-based credit system. Structural changes in dollar asset markets Although U.S. authorities managed to provide the financial system with sufficient liquidity and support to stem the market panic, they must now find a way to foster more enduring changes that will result in a sounder financial system. The crisis revealed significant structural flaws, but reforms are being debated to address many of these issues. Some of the required changes are associated with the oversight of large and interconnected financial institutions. The reform efforts underway in Congress are intended to address several points of weaknesses, including gaps in the coverage of systemically important firms and the absence of a resolution process for an orderly wind-down of failing firms. In addition, regulatory standards are being reevaluated to strengthen capital and liquidity requirements and to improve the risk capture of those standards. The crisis also revealed weakness related to specific financial markets involving structured products, housing-related GSEs, over-the-counter (OTC) derivatives, triparty repo and money market mutual funds. Reforms are underway in each of these areas.

The broad intent of all of these facilities was the same – to keep an extreme increase in the demand for liquidity from significantly disrupting the functioning of financial markets and impairing the flow of credit to the economy. The facilities, along with other efforts from governments, helped to halt the downward spiral and to alleviate the pressure on global financial institutions and markets. In the absence of such effective actions, the implications of the crisis for real economic performance would have been much worse. The success of the programs has been apparent in a number of dimensions. Most clearly, the degree of counterparty concern and liquidity hoarding in the money markets has diminished, as reflected in the decline in term funding spreads. Moreover, issuance of both commercial paper and some types of asset-backed securities has rebounded, and it has done so increasingly without reliance on the Fed’s liquidity support. It is also worth noting that the exit from the Federal Reserve’s liquidity facilities has been quite smooth. At their peak, these facilities provided about $ trillion of short-term dollar credit. Today, the remaining balance across them is well under $ billion. This reduction was achieved without creating any significant problems for financial markets or institutions. That success largely reflects the effective design of those programs, as most were structured to provide credit under terms that would be less and less appealing as markets renormalized.