samchain/econo-pairs-v1 huggingface dataset:
And the pre-emptive policy measures taken will help us to weather this storm. These are important facts on the economy and as Malaysians, it is important that we act in a manner that does not jeopardise the recovery and the confidence of investors, which in turn can create a negative self-fulfilling cycle. 8. It is instructive to compare what we are going through against past crises. For this, allow me to highlight some observations contrasting where we are today against the recent pandemic and the Asian Financial Crisis:  a. On growth: Compared to the strong, positive momentum we have now, our economy contracted by 7.4% in 1998 and 5.5% in 2020.  b. On unemployment: The labour market now is healthy. Unemployment jumped from 2.4% in 1997 to 3.2% in 1998, and from 3.3% in 2019 to as high as 5.3% in May 2020. Now it has dropped to 3.7%. In addition, strong job prospects are encouraging more people to seek employment, resulting in the labour participation rate already surpassing the pre-pandemic level. c. On the banking sector: Having well capitalised financial institutions has ensured financial intermediation continues uninterrupted. Financial institutions also continue to play a key role as an automatic stabiliser in financial markets. In particular, the banking system has low and well managed exposures to foreign liabilities. In contrast, the depreciation of the ringgit in 1998 by around 47%, amplified pre-existing balance sheet weaknesses in the banking sector given significant foreign currency liabilities, necessitating the restructuring and consolidation of banks.

This includes to avoid creating new vulnerabilities, especially from foreign currency debt and financial imbalances, as well as hedging their risks appropriately. Businesses and investors that benefit from a ringgit depreciation should also take advantage of the weaker ringgit. For example, for those in tourism and exports to increase production and capitalise on this opportunity, and for those with a global presence, to reinvest back home. 21. On a broader note, as an open economy, the policy priority for Malaysia is to sustain economic growth within an environment of price stability and to further strengthen economic fundamentals through the necessary reforms. This will provide more enduring support for the ringgit rather than resorting to capital controls or re-pegging as some have suggested, which would create more harm to the economy. Reforms to secure our future Ladies and gentlemen,  22. This brings me to the second half of my speech today, where I will touch on how Malaysia can secure a more sustainable and prosperous future in the face of future challenges and uncertainties. Malaysia has gone through challenging periods in the past and history has shown that we can rise to the occasion when we need to. Let us rewind back some history. 23. Less than 50 years ago, Malaysia was primarily an agriculture- and commodities-based economy – think of tin and rubber. When commodity prices for tin and rubber slumped in the early 1970s, our economy was badly affected. Unemployment skyrocketed to close to double digits.
But both of the theses I mentioned earlier are the same: When cross-border integration progresses it is important – and profitable from society’s point of view – to create credible crisis resolution mechanisms in advance. But this is rarely or never done. One sometimes talks of Europe’s “financial trilemma”.9 We in Europe want to achieve a continued financial integration and increased financial stability, but at the same time we want to retain each country's national sovereignty. The problem is that it is possible to attain two of the goals, but very difficult to attain all three. If we want to combine financial integration with continued national sovereignty over, for instance, supervision and crisis management, as we have done so far, it will be difficult to achieve meaningful financial stability – the crisis we are currently going through provides a good example of this (Figure 3). Figure 3 Financial stability  Financial integration  National sovereignty  If, on the other hand, we want to prevent cross-border crises and at the same time maintain national sovereignty, we must accept reduced financial integration – for example, stricter regulations as to how banks can move financial assets between countries (Figure 4). One can see clear tendencies in this direction in the current discussions.

Specific and rules-based regulations, while able to lead institutions in the right direction, do not guarantee the internalisation of such values within bankers nor are they dynamic enough to catch up with new ways of breaching ethics. Therefore, the Bank will also be expanding its supervisory focus on financial institutions beyond balance sheet ratios, and incorporating organisational culture in our radar such as tone from the top, echo from below, accountability, communication, remuneration and performance management. This is a challenging but necessary task that requires creativity in exploring unconventional supervisory approaches including interviews and questionnaires for employees of financial institutions among others..  Risk management as part of business strategy Finally, risk managers must move away from merely compliance and loss prevention. Risk managers must reposition themselves to be more engaged in strategic business decisions within their respective organisations. Chief Risk Officers (CROs) must have a broad and independent view of the organisation, with an ability to anticipate potential disruptions and to influence decision-making. However, according to a global survey conducted by PwC last year, only 1/3 of risk officers view themselves as part of the business. Especially now in the age of disruption, risk managers should not view themselves as mere compliance officers or the mundane department that says ‘no’ to exciting business opportunities. Instead, risk managers need to also think in terms of finding the right risk-return trade-off. Risk management must go beyond the prevention of losses and play an active role in driving business sustainability and enhancing shareholder value.
William C Dudley: How goes the recovery? Challenges for the nation, the region and the Fed Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, at Cornell University, Ithaca, New York, 25 October 2010. *  *  *  Good morning. I am pleased to have this opportunity to speak to you as I travel through Upstate New York to meet with various communities in the region. This afternoon I will focus on national and regional economic conditions and what the Fed is doing about them – with particular attention to the housing sector and to conditions in Upstate New York. As always, what I have to say reflects my own views and not necessarily those of the Federal Open Market Committee (FOMC) or the Federal Reserve System. Introduction to the New York Fed As many of you know, this is my first chance to speak at Cornell University since I became president of the New York Fed. So, by way of introduction, let me start with a synopsis of what the New York Fed is, what we do and what makes my job so interesting. The New York Fed is part of the Federal Reserve System, America’s central bank, and was created by Congress in 1913. With this act, Congress delegated to the Fed System its constitutional authority to manage the money supply – and designed it be decentralized, representative of all of America and independent of the political process.

I maintain that. WSJ: What do you think the risk is that this wrenching process will cause the breakup of the euro or its membership? TRICHET: Of course the euro is there and will be there in the future. I do not comment on what I consider absurd hypotheses. I am used to such questions from the very beginning of the euro. The paradox is that, years ago, the question was about Germany supposed to be at that time the “sick man of Europe”. I was responding that Germany was doing hard work that its economy was catching up on competitiveness. Now the same hard work has to be done by those that were growing rapidly over the past years but at the same time had lost their competitiveness. One has to accept that within a vast economy that has the size of the euro area, with 331 million people, there are economic differences. For instance when I look on both sides of the Atlantic I see that the differences between the fastest and slowest-growing U.S. states, it is more or less of the same order of magnitude as between countries in the euro area, for instance between Oklahoma and Nevada, 13 % differences in growth in 2009; between Slovakia and Ireland more than 9 % in growth in 2008. WSJ: The U.S. copes with these differences through labor mobility and a federal budget. Does the euro zone ultimately need a big federal budget?
What is more, the world economy is still characterised by profound imbalances, such as the deficit in US external accounts and the lack of flexibility in the Chinese monetary system. Turning now to monetary policy, there were often considerable disparities in 2005, for instance, the progressive hikes in the rate of interest in the United States at a time when monetary policy in Europe was characterised by a waiting-game approach. Despite these potentially destabilising factors, financial markets remained relatively calm. In currency markets, the dollar picked up in the wake of tighter US monetary policy, while the yen moved only slightly against the Swiss franc. The exchange rate of the euro against the Swiss franc fluctuated within a narrow range, thereby reflecting the strong convergence of fundamentals in Switzerland and the euro area. Over the past few months, the Swiss franc has even trended downward – a decline that is hard to explain given the low rate of Swiss inflation as compared to the rest of Europe. If this trend  2  BIS Review 34/2006  were to accelerate and give rise to an excessive relaxation in monetary conditions with respect to economic developments, a normalisation of interest rates would become even more essential. Generally speaking, the capacity of financial markets to absorb shocks and to cope with imbalances is one result of globalisation and the progress in financial intermediation. In addition to stimulating goods markets, globalisation has also enlarged and deepened financial markets, and is doing so to a growing extent.

It also depends on the political environment within which a central bank operates, since markets are concerned about more than just the formal autonomy of the monetary authorities. They also pay attention to the degree of political acceptance of central bank decisions. If monetary affairs are subject to permanent political debate, this can become a hindrance to credibility. Recognising that monetary matters should be conducted in a relatively calm setting does not mean that the policies adopted by the central bank should escape all democratic controls. Nowadays this form of control is tighter than ever before. Indeed, most monetary regimes now require that the central bank report to the legislative authorities on the execution of its mandate. This is also the case in Switzerland, since article 7 of the National Bank Act requires that we present a report on the fulfilment of our tasks to the Federal Assembly each year. Despite these measures, National Bank affairs are often the focus of animated political debate. Paradoxically, these debates do not relate to monetary policy in the narrow sense of the word, but rather to other aspects of a more operational nature – such as the level of the monetary reserves or the distribution of the profits. BIS Review 34/2006  3  Allow me to give you an example.
Mervyn King: The inflation target ten years on Speech by Mr Mervyn King, Deputy Governor of the Bank of England, delivered to the London School of Economics, London, 19 November 2002. The references for the speech can be found on the website of the Bank of England. * 1. *  *  Introduction  Ten years ago, in this very room, Robin Leigh Pemberton (then Governor, now Lord Kingsdown), delivered the first LSE-Bank of England Lecture. It was entitled “The Case for Price Stability”. In the twenty-five years prior to that lecture, prices had risen by over 750%, more than over the previous two hundred and fifty years. So the audience on that evening in November 1992 had grown up in a world in which rapidly rising prices appeared inevitable. They were the inflation generation. To them price stability seemed remote. Inflation was simply taken for granted. But that LSE-Bank of England Lecture coincided with the introduction of a new monetary framework the inflation target. Since then price stability has become a reality. Over the past decade inflation has averaged 2.5%, and has been no lower than 1.5% and no higher than 3.3% Alan Greenspan defined price stability as when “expected changes in the average price level are small enough and gradual enough that they do not materially enter business and household decisions.” With inflation expected to remain close to 2.5%, it is no longer a material concern to families and businesses in this country.

While these measures have merits in safeguarding financial stability, they could have complex and cross-border impact. Even on the monetary policy front, unconventional measures are becoming more conventional. Central banks in the major economies have increasingly used unconventional monetary easing. Though necessary to stabilize their economies at this juncture, these policies have side effects of large and volatile capital inflows into Asia. This  BIS central bankers’ speeches  1  further complicates safeguarding of financial stability in other countries including Asia, and could, in turn, trigger some countries to resort to macroprudential measures themselves. Thus, in terms of policy space, we are dealing with a new paradigm of expanded policy tools, with new transmission mechanism, and requiring their own policy framework and governance. So we need to recognize the need for cross-border coordination as well as flexibility in execution given emerging uncertainty. Turning to the more medium-term structural issues, major regulatory reforms especially Basel III, Financial Stability Board reforms, and Dodd-Frank Act are still a known-unknown. We do know that they are designed to redress weaknesses that caused the crisis by enhancing capital and liquidity, while addressing the problems of procyclicality, and too-big-to-fail of SIFIs. For this, their merits are well recognized. But these reforms will reshape the global financial landscape and raise cost of financial intermediation. They will also have implications for cross-border level playing field, regulatory arbitrage, and alter risk profile of banks.
Prasarn Trairatvorakul: From here to there – transition in emerging markets Speech by Dr Prasarn Trairatvorakul, Governor of the Bank of Thailand, delivered in the Thailand@Harvard Series, Harvard Kennedy School, Boston, Massachusetts, 7 October 2013. *  *  *  Distinguished guests, ladies and gentlemen, It is a pleasure for me to be back here at Harvard and to have a chance to contribute to the Thailand@Harvard series. Boston has certainly changed a lot since I graduated over 30 years ago. But the warmth and sense of intellectual purpose that I still feel here makes it all seem like yesterday. And by that I don’t necessarily mean the stress of studying for my general exam! Later this week I will be attending the Annual Meetings of the IMF and the World Bank. Undoubtedly one of the key issues that will be discussed is the recent growth slowdown in many emerging market economies. Certainly, among market commentators and in policy circles, the medium-term growth prospects for China, India, Brazil and other emerging economies have become the talk of the town. And it will be the focus of my remarks today. What happens in emerging markets matter. Together, they account for more than half of world GDP.1 Since the early 2000s, when Jim O’Neill at Goldman Sachs coined the acronym BRIC for Brazil, Russia, India and China, emerging markets have powered global economic growth. By mid-2009, these economies were growing 7 percentage points faster than the G7 economies and contributed around two-thirds of world output growth.

But at the September meeting the Executive Board’s assessment was that there would not be any more raises and that the interest rate might need to be cut during 2009. The decision was reached by a narrow majority. Three members of the Executive Board supported the decision, while three were against it, and the Governor’s casting vote was decisive. I was part of the minority who wished to hold the repo rate unchanged at the September meeting and to see a slightly faster reduction in the rate in the future. The main reasons put forward by the majority for raising the interest rate were that inflation had continued to rise and was far above the target, that inflation expectations remained high and that cost pressures had increased. The majority assessment was that it was necessary to raise the repo rate to prevent the increases in energy and food prices from spreading to other areas. The reasons for lowering the interest rate path included the fall in the oil price and other commodity prices over the summer. Another reason was that growth had slowed down more than expected, both in Sweden and abroad. The turmoil in the financial markets was of course also included in the picture. BIS Review 119/2008  5  My own assessment I personally had entered a reservation as early as July against the forecast that it would be necessary to raise the repo rate a couple more times during the autumn.
If the private sector continues to grow – in line with the latest business survey evidence – and headline inflation remains high, it is hard to see why private sector pay settlements should not return to their pre-recession average of around 3.5% and possibly move higher.9 Issue 4: Inflation expectations and credibility That brings me to my final key issue – the role of expectations and credibility in the framework for monetary policy. Chart 12 shows a diagram which I have used in a number of speeches now and which I believe sums up well the challenge that the MPC faces in trying to stabilise UK inflation in a potentially volatile global economy. The global economy affects inflation in the UK through the cost of imports, the impact of world demand on the UK economy and through the way in which international businesses perceive the pricing climate changing on global markets – which will have an impact on their pricing strategies here in the UK. All these factors can affect UK inflation – but monetary policy has three powerful counter-influences: the influence of monetary conditions on the exchange rate and the level of domestic demand, and the ability of the monetary authorities to anchor price expectations through their commitment to the inflation target or some other monetary anchor.

These mainly consisted of extraordinary budgetary items to reinforce their health systems and provide liquidity support to households and firms, including guarantees, loan servicing payment deferrals, capital injections, additional public spending and forgone revenue, including temporary tax cuts. Turning to monetary policy, nearly all of the region's central banks have cut interest rates to record lows. Further, they have provided liquidity in local currency and in dollars, conducted banking interventions and some of them have even established asset purchase programmes,6 which have reduced the volatility in longer-term interest rates and in exchange rates. 5  For a description of the pandemic transmission channels in the region, see Banco de España (2020), “Report on the Latin American economy. Second half of 2020”, Analytical Articles, Economic Bulletin, 4/2020. 6 For a description of the asset purchase programmes run by central banks in emerging economies, see Banco de España (2020), “Asset purchase programmes of Latin American central banks”, Box 1, “Report on the Latin American economy. Second half of 2020”, Analytical Articles, Economic Bulletin, 4/2020. 4  Likewise, the corresponding economic authorities adopted a set of macroprudential and supervisory measures to foster the flow of credit, provide liquidity to the banking system and mitigate the adverse impact of the crisis on financial institutions’ capital.7 All of these measures have helped to ensure that the main indicators of the most important Latin American banking systems for Spanish banks have not deteriorated significantly.
As someone who has argued in the past – often in the face of considerable scepticism – for the importance of monetary and credit mechanisms in monetary policy transmission,18 I find these channels both plausible and potentially important, even if the evidence on their empirical impact is mixed, perhaps reflecting the state contingency of both the signalling and portfolio balance channels. Central banks should certainly be wary of suggesting that their armoury is exhausted when policy rates reach their effective lower bound. Such a view both risks creating deflationary dynamics through a self‐fulfilling prophecy and denies the ultimately monetary origins of price level developments. Asset purchases as a complement to changing Bank Rate Second, central bank asset purchases (and other market interventions) can be understood as efforts to maintain  Bank of England  Page 10  the conventional interest rate channel of monetary policy transmission. By their nature, such efforts are complements to, rather than substitutes for, changes in Bank Rate. To maintain monetary transmission through conventional channels at times of market stress, central banks may need support to the private sector, so as to maintain the functioning of financial markets, institutions, and infrastructures. This has a long history: dealing with ‘banking panics’ towards the end of the nineteenth century was an important motivation for the creation of the Federal Reserve, for example; and the famous Bagehot Rule governing the provision of liquidity support to the banking system has been an important guide for central bank policy for more than a century.

Looking back at the first speech I gave as an MPC member this time last year,8 gas prices barely featured. Rather the focus was on supply chain disruptions and the potential threat of the Omicron variant, which had just started to emerge as I spoke in Newcastle. Second, the shock was large. Although it has eased somewhat in recent months, the January European wholesale gas price future – most relevant for next year’s household energy bills that enter the CPI basket – rose more than ten times to its August peak. Third, these gas price rises passed-through to the CPI inflation that the MPC targets relatively quickly: in a matter of months – certainly at a shorter horizon than the 18-24 months typically associated with the lagged pass-through of monetary policy actions to inflation developments. And fourth, higher gas prices exerted an adverse supply-side effect on the UK economy, and thus induced a difficult trade-off for monetary policy: inflationary pressures rose at a time when economic activity weakened. Taken together, these characteristics implied that gas price driven volatility in CPI inflation was inevitable.