samchain/econo-pairs-v1 huggingface dataset:
This decision was taken on the grounds that the main elements which entered the determination of the reference value, namely the definition of price stability, the estimate of the trend growth of real GDP and the trend decline in the income velocity of M3, had basically remained unchanged. The Governing Council will continue to monitor monetary developments against the reference value on the basis of three-month moving averages of the annual growth rate of M3 as monthly developments might be too volatile. In addition, we also noted that the generous liquidity situation in 1999 will have to be kept in mind when assessing the information content of monetary developments in the future. Considering the second pillar of the monetary policy strategy, namely the broadly based assessment of other indicators containing information about the outlook for price stability, most indicators and forecasts have been pointing to increasing upward pressure on consumer price inflation over the medium term. The strong increase in oil prices in 1999 and early 2000 and the depreciation of the exchange rate of the euro in recent months have contributed to upward pressures on import and producer prices. In addition to the direct effects of these pressures on consumer price inflation, there is 1  BIS Review 25/2000  the risk in the context of the strong cyclical upswing that these developments could, via second-round effects, have lasting effects on consumer price inflation.

Aiming at positions of budget surplus and reducing debt to GDP ratios should free resources, which could be used by the private sector to finance new initiatives to create employment. I am confident that the first decade of the new millennium could, if all parties concerned take their responsibilities very seriously, mark the beginning of a prolonged period of price stability, growth and employment creation. Inflation rates are currently among the lowest levels observed after the war, and we are determined to maintain this very substantial achievement. Fiscal policies have already made good progress in correcting the serious mistakes of the 1980s and early 1990s and they are encouraged to continue on the path of fiscal consolidation. These favourable conditions for a period of growth are clearly better now than at any time over the last ten years and this should both foster and facilitate structural reforms. 2. Other activities of the Eurosystem  From among the other activities of the Eurosystem over the last few months, I should like only briefly to report on a few specific issues, which might be of particular interest to you. BIS Review 25/2000  2  At present, the ECB is preparing this year’s Convergence Report. As you will be aware, the Treaty requires the ECB and the Commission to present such a report at least every two years.
Underlying forces that were created by the financial crisis and that would themselves keep inflation low have been offset by other factors that have kept inflation above target for much of the past year. These factors are well known but it is important not to forget the likely scale of their impact. Around one quarter of the goods that enter the basket for calculating the UK CPI are imported. The 25% depreciation seen since 2007 would – given that imported goods and services account for around a quarter of the consumer price basket – add a bit above 6% to the level of the CPI. Over a three-year-period that would generate 2% a year higher inflation. We have also seen the VAT rate cut and then increased. When the cut was having its largest impact on the annual rate of inflation last year the CPI inflation rate fell to 1.1%. The subsequent rise in VAT at the start of this year has helped push inflation back above the target by about the same amount. At the start of next year there will be another VAT rate increase – and that is likely to keep inflation above the target a bit longer. I am not blasé about that. That is why I said that I thought we face a risk in the UK of not doing enough to bear down on inflation. But there is also a risk of tightening monetary policy too soon.

For VBI to work, the desired collaboration has to bring in not just our market players, but also other non-financial stakeholders, to pool critical skills and infrastructure that reside beyond our terrain. By expanding our network, we will be better able to deliver far greater values that otherwise could not be achieved if we were to depend on limited capabilities within the financial industry alone. With stronger collaboration, I believe there will be much more that each individual can learn from one another. In this context, the Community of Practitioners comprising committed Islamic banks, will be instrumental in pioneering advancements in VBI. The Community of Practitioners will serve as the nucleus for other collaborative efforts. Networks to be formed will comprise a diverse group, from ventures and corporates to knowledge and advocacy institutions. Through the exchange of knowledge and experiences, as well as coordinated actions to address implementation issues, the Community of Practitioners can help accelerate the execution and amplify the benefits of VBI. I would also like to thank the panel members that will take part in the Panel Discussion today, which also includes representatives from the Community of Practitioners. We can certainly gain greater insights from the panel members who will elaborate further on the VBI approach and provide interesting perspectives on its implementation. In conclusion, while the Malaysian Islamic financial sector has made great strides since its inception over 30 years ago, the next growth frontier in Islamic finance is in realising its potential to create greater socio-economic impact.
Introducing a CBDC will involve such a substantial change in the monetary system that it will require a political decision. It could also involve the question of whether the Central Bank Act would have to be amended. What is the current situation? Norges Bank’s research is now in a third phase, to be completed in the new year. We are working on specifying the features a CBDC should have and considering a range of technical solutions. We are also drawing on other central banks’ experience and plans. Possible strategies for testing and experimenting with technological solutions are also being assessed. The core of a prospective CBDC system will be controlled by Norges Bank. Banks and other third parties could provide end-user services. This is a natural division of roles. Norges Bank would facilitate innovation through the design of the system’s technical core and regulatory framework. The consequences a CBDC could have for the financial system depend entirely on its design. The design could influence which claims the public decide to replace with CBDC and on what scale. If CBDC replaces cash, banks’ balance sheets will not be affected – the public will simply replace one claim on the central bank with another. If the public replaces bank deposits with CBDC, the consequences for the financial system could be more severe. Banks’ access to deposit funding could be reduced and banks’ funding costs could rise. During a financial crisis or other situations of high uncertainty, the public can suddenly withdraw bank deposits.

In contrast, bank deposits are claims on private banks. CBDC raises some fundamental questions as to the role of central bank money. This is much more than a question of technology. Chart 4 Central bank digital currency Norges Bank is not alone in assessing the need for central bank digital currency. Many central banks are engaged in similar research. Several are in the process of testing technical solutions. Both Sveriges Riksbank and the central bank of China launched pilot projects earlier this year. The European Central Bank (ECB) signalled last month that it was stepping up its research on a digital euro. Central banks are considering introducing a CBDC for a variety of reasons. In emerging economies, the focus is on financial inclusion and low-cost payments. In advanced economies, the focus is more on the role of cash and the emergence of new monetary and payment systems. A trend specific to Norway and some of our neighbouring countries is the low and falling level of cash use. Users increasingly choose solutions offering contactless payments and payments via smartphone apps. These solutions use bank deposits as the means of payment. At the same time, cash has some unique characteristics that could be important to preserve in the payment system of the future: Cash is part of the contingency arrangements if the electronic contingency solutions fail. Cash is a credit risk-free alternative to bank deposits and can promote competition in the payment market. 2/6  BIS central bankers' speeches  Cash is legal tender that is widely accessible.
Given that no agreements are cancelled prematurely, 2007 will be a very busy agreement year, since the majority of the collective bargaining agreements concluded in the business sector and the central government sector in 2004, as well as the municipal sector from 2005, will be due for renegotiation.4 The social partners and individual companies have gradually adjusted to the low inflation rate. Wage setting also has become more decentralised, entailing increased opportunities to change relative wages within the scope of a given rate of wage increases. But despite this, we have a compressed wage structure in Sweden in comparison with many other countries. Wage structures differ between blue-collar and white-collar workers. Blue-collar employees’ wage structure is considerably more compressed and constant across age groups.5 The wage spread for white-collar workers is larger and increases up to 45 years of age, after which it gradually decreases. It is mainly in the higher income groups that the wage differences between blue-collar workers and white-collar employees are large. In the lower-income groups the differences are very small.6 But on average white-collar employees have long been pulling away from blue-collar workers, which risks building up tensions in the labour market ahead of future negotiations. Wages can also vary across different regions. But this wage spread is not especially large in Sweden either. It is mainly Stockholm, Jämtland and Gotland that have a clearly different wage situation. Stockholm has the country’s highest wage level, while Jämtland’s and Gotland’s wage level is below the national average.

Between 1975 and 1995, Swedish inflation averaged 8 per cent a year. Real wages rose by only 0.5 per cent a year. Swedish companies’ competitiveness deteriorated and industrial production dropped. Sweden slipped from 4th place in the OECD’s standard-of-living league to 18th place – below the average for OECD countries. We became a relatively poor country in Europe and the industrialised world. Meanwhile, deregulation in the credit market during the 1980s resulted in a sharp expansion in credit, with an accumulation of debt among the general public as a consequence. Demand increased but supply was weak and productivity growth low. The economy overheated, inflation picked up and competitiveness was eroded. In 1990, the international economy began to weaken and prices of assets and property fell. The economic climate deteriorated dramatically and eventually the banking crisis hit the country, with large loan losses as a result. The Riksbank defended the fixed krona exchange rate to the very last, but after large currency flows and extreme rises in interest rates the fixed exchange rate was abandoned on 19 November 1992. The outcome of the performance during the 1970s and 1980s was that we slipped down the standardof-living league, suffered mass unemployment and saw a drop in GDP of 4-5 per cent. It was at this juncture that an explicit inflation target was introduced. The depreciation of the krona in 1992-93 of almost thirty per cent gave the manufacturing industry a powerful boost.
The lenders expected that house prices would continue to rise, increasing the value of the collateral, an assumption which meant that the risk to the lenders was assessed as slight. The strong increase in the new forms of mortgages contributed to the overheating in the housing market. BIS Review 56/2009  1  Another factor that can also be assumed to have contributed to the housing market bubble in the United States is the US housing policy, which since the mid-1990s had become increasingly aimed at extending house ownership among households. For example, the semi-nationalised mortgage institutions Freddie Mac and Fannie Mae were to offer a particular share of their total lending to low-income families. This contributed to many households receiving loans despite having an uncertain ability to repay. The credit expansion that was seen in the United States can also be seen in a number of other countries. In autumn 2005 the housing market bubble in the United States burst and house prices began to fall. As the value of the households’ most important collateral fell, an increasing number of households could no longer renew their subprime loans at the same low interest rate. The lenders had tightened the credit terms. The interest rate shock that followed meant that an increasing number of households experienced problems in paying, which in turn pushed down house prices even further. This occurred as an increasing number of households and banks were forced to sell the houses at compulsory auctions at a lower price than before.

Without these measures we would probably have faced a financial meltdown. One sign that the crisis is no longer as acute is that what are known as TED spreads have fallen in Sweden, as well as the United States and the euro area. The TED spread is the difference between a three-month interbank rate and a three-month treasury bill rate. The spreads are now back at around the levels prevailing immediately prior to the worsening of the crisis in autumn 2008. But the financial markets are still functioning much less efficiently than normal. It is also still difficult for companies to finance themselves in the capital market. Moreover, the liquidity injection from the central banks does not solve the banks’ capital problems. For this reason it is not surprising that the international discussion is currently aimed more at solvency than liquidity. It would be very much appreciated if many countries could begin to distinguish bad banks from good ones in an effective and transparent manner. In Sweden, too, we have implemented a large number of unconventional measures to safeguard financial stability and mitigate the negative effects of the financial crisis. During the second half of 2008 the Riksbank increased its lending to the banks by more than SEK 450 billion. Almost SEK 200 billion of this was comprised of loans in US dollars. This has largely been financed by means of swap agreements with the Federal Reserve in the United States.
This means that we, together with the Ministry of Finance in the Government Offices, coordinate and conduct Swedish policy in this forum. This evening, I am intending to talk about globalisation - as an opportunity and a challenge. I am going to discuss what the International Monetary Fund is and the role that it has in an increasingly globalised world. To conclude, I will take up Sweden’s participation in the IMF, and what we can expect from the meetings in Prague next week. Globalisation and its benefits Before commenting on critical remarks often presented on globalisation, let me first begin by noting that prosperity in the world has improved dramatically during the past decades. Never before in history has the situation of so many people improved so much so quickly. Since the beginning of the 1980s, purchasing power per capita in the world has more than doubled. In the poor developing countries, this has meant that purchasing power correlated GDP per capita has increased by almost 350%. In the rich industrialised countries, the corresponding growth was 220%. In certain cases, developments have been particularly spectacular, not least in Asia. In 1975, six out of ten Asians lived in absolute poverty - under a dollar a day. Today, the figure is two out of ten. In China alone, the number of poor has fallen from 60 to just under 30% in less than twenty years. There are many factors that explain this development.

In order to function democracy requires that citizens can hold decision-making accountable at the level at which these are taken. But today we can only elect and sanction at the national level, while decision making is widely done at the European level. Therefore, we have to enhance the decision-making process at the European level through appropriate democratic control measures and more direct election and sanctioning features. The solutions to these issues are not simple, and reasonable people may well disagree on their form. This forum is an ideal place to debate what laws, rules and institutions we need to put in place to strengthen the integrity of the Union. I promised earlier that I would give you something to argue about tonight! I believe the vision of a united Europe is worth striving for. To make this vision come true, we also need to understand the forces behind the populist dissatisfaction with the Union, and not dismiss them. The referendum debate in the United Kingdom has been acrimonious. In striving to deliver a united Europe, we need to be united in ourselves and build a shared EU-wide identity that delivers the necessary democratic legitimacy to the institutions. Strive mightily, but eat and drink as friends. 2  BIS central bankers’ speeches
As far as the decline of cash is concerned, the immediate response is to make sure cash will remain available to any and all that want to use it. The Bank has made clear that we will continue  Page 5  to produce it and the Government is taking powers under the Financial Services and Markets Bill to give the Bank of England and FCA new powers to ensure the future effectiveness, resilience, and sustainability of the cash ecosystem[6]. However, we cannot ignore the fact that the safest form of money, ‘public’ money, that it is to say money issued by the state for general use, will become increasingly less useful and useable and of shrinking relevance to a large part of the population. Nor can we ignore the likelihood that we will see the emergence of new forms of money, offering new possibilities and issued by new as well as established players. This raises, particularly for the Bank of England, the question of how we can continue to ensure that all of the types of money used in the UK are denominated in Sterling, remain safe and that each is interchangeable on demand and to all of the other types of money without loss of value, including publicly issued, Bank of England money. We ensure trust in money at present by regulation of the commercial banks that issue money, by requiring banks to settle amongst themselves in Bank of England money (i.e.

Hence, although the process of EU accession consists of three different phases, namely EU accession, ERM II membership and the adoption of the euro, a single common trajectory cannot be prescribed for all countries. BIS Review 84/2001  1  Such a plurality of approaches also applies to the economic experiences of accession countries over the past decade. After the rather abrupt developments at the beginning of the transition, the accession countries have generally attained macroeconomic stabilisation, and they have done so despite pursuing different policies and strategies. A remarkable process of disinflation, structural reforms and relatively sound fiscal policies have supported positive growth – which is still moderate in some cases. Despite the worldwide economic slowdown, GDP in accession countries is expected to grow at, on average, around 3.2% this year. The stabilisation success has been confirmed by the accession countries' resilience to the Asian and Russian crises in the past and, more recently, to the developments in Turkey and Argentina. No doubt, the prospect of EU accession has helped to trigger reform in the accession countries and provided an umbrella to shield them from financial turmoil. The challenges ahead, however, are still formidable: the transition agenda has not yet been completed, reforms have seen major setbacks and substantial structural differences with the euro area remain both in the real economy and in the financial sector. Today, I would like to highlight three of these challenges, which are of particular relevance to the ECB.
Lars Heikensten: The Riksbank and the euro Speech by Mr Lars Heikensten, Governor of the Sveriges Riksbank, at the Society of International Treasurers Convention, Stockholm, 17 June 2003. *  *  *  Let me begin by thanking you for the invitation to come here and speak on the subject of EMU. Approximately three months remain until 14 September when the Swedish people will vote on whether to participate in monetary union. In the event of a “yes” vote, Sweden will enter monetary union in 2006 and introduce the euro as its currency. The right of determination over our interest rate level will then be transferred to the European Central Bank (the ECB). On the other hand, a “no” vote would generally imply “business as usual” for the Riksbank. Today, I will be speaking about some of the implications for the Riksbank and our operations in the event of a “yes” vote in the referendum. I will begin by speaking about the preparatory phase, that is, from 14 September until 1 January 2006, during which time preparations will be conducted in the Swedish economy for a changeover to the euro, and the krona will join the exchange rate mechanism, ERM2. Subsequently, I will talk on the issue of monetary policy as it will be conducted by the ECB and point to differences as well as similarities with how it is conducted today. Thereafter, I will touch upon the effects of a changeover on our work with financial stability.

The Riksbank also has an internal preparation process with broad participation. Finally, we publish the minutes of Executive Board meetings in which the opinion of each member is evident. The latter issue has a different “charge” at European level since there is a risk that a genuinely single monetary policy would be undermined if individual positions were made public. Monetary union and financial stability in Sweden The Riksbank not only has the task of maintaining price stability but also that of promoting a safe and efficient payment system. In light of this, allow me also to say something about the potential implications of entry into monetary union from this perspective. The financial markets in Europe have developed rapidly over the past decade, partly as a result of the fact that the freedom to trade financial services is fundamental to the cooperation in the EU. Competition for the national banks has hardened. The single currency has contributed to the evolution of a far better capital market outside the banks, which has increased competition further. In several large European countries, a process of structural transformation in the banking systems is underway, much like that experienced in Sweden in connection with the banking crisis at the beginning of the 1990s. When competition grows stiffer, it can of course pose a threat to stability, especially if the banks are not accustomed to competition and are also weakly capitalised.