samchain/econo-pairs-v1 huggingface dataset:
Nowadays, central banks are entrusted with the fundamental task of providing citizens with costless access to simple, secure and risk-free means of payment that can be used on a large scale. Delivering on this task requires central banks to analyse relevant developments in society and adapt accordingly. In order to be able to give Europeans easy access to a safe form of central bank money in a society that is moving increasingly quickly towards digital payments, the ECB’s Governing Council has decided to advance work on the possible issuance of a digital euro. Should the need arise, we want to be ready to introduce a digital euro: a form of central bank money that would complement cash, not replace it. Together, these two types of money would be accessible to all, offering greater choice and easier access to ways of paying. After publishing our report on a digital euro on 2 October, we are now in a phase of listening and experimentation. Our exchange today is a key step in this phase and marks the launch of the ECB’s public consultation.6 I will come back to this consultation in a moment. But first I will outline the characteristics of a digital euro, as well as the advantages and the challenges it could present. I will also discuss some scenarios that could require the ECB to issue a digital euro. What is a digital euro?

Second, economic transformation in response to climate change, as a result of an adaptation and mitigation process, will also require the financial sector to adapt, by managing risk and by exploring opportunities for business. Third, being a prominent sector in the economy, the financial system can also be an agent of change, supporting the adaptation and mitigation process, through its influence on financial resource allocation, through developing supportive financial services, markets, and products, as well as engaging climate change in its own business agenda. Let me elaborate in more details on each of these points, starting with the macro impact and implications for the financial system. Conventional wisdom at this time is that the macroeconomic impact from climate change can be large, but uncertain. For example, estimates from three benchmark studies, as cited by the IMF, point to a mean GDP loss of about 0-3 percent of global GDP for a 3oC warming. In Asia, South and Southeast Asia are to be amongst the regions most likely to experience the most negative effects. Such macro-impact is tantamount to a supply shock on the country’s long-term productive capacity i.e. capital stock and technology, leading to a decline in long-term output growth, higher production cost and inflation, shift in relative price away from carbon-based energy, and a decline in productivity. Some countries may suffer balance of payments problems if they are financially unable to cope with the impact.
However, there are some structural problems here: an unmotivated weak exchange rate risks strengthening certain parts of the export industry that do not constitute expansive future sectors. Sweden's future hardly lies in competing with low costs and prices, but rather with quality, cutting edge technology and know-how. When the krona eventually appreciates to a level more motivated on the basis of fundamental factors, Sweden will have an industrial structure poorly equipped to meet the requirements of the future. Conclusions The Riksbank assumes that the krona will appreciate. It is possible that we have already seen the beginning of this development very recently. When the upturn does take place, it may prove even stronger than the Riksbank estimated in its latest Inflation Report. This does not prevent the fact that the recent valuation of the krona has brought new perspectives to the question of Swedish membership in the third phase of the EMU, i.e. participation in the eurozone. The volatility of the krona creates difficulties for export and import companies in making decisions regarding trade and investment. However well monetary policy functions, it still cannot supply the efficiency gains at the microeconomy level that ensue from a single currency. The effects on growth through both price competition over the borders and increased trade could be greater than we have previously often assumed. 4  BIS Review 92/2001  An independent monetary policy will of course remain the main argument against EMU membership. The question is how valuable this is.

Also, in this respect Sweden has changed in recent years: the introduction of inflation targeting and expenditure ceilings should reduce the risks of new economic policy mistakes. In addition, there are strong indications that the correlation between Swedish and eurozone growth will increase if we join the EMU, as trade and integration with the euro countries will thereby be strengthened. We can see already how the long-term Swedish market rates have covaried strongly with those in the eurozone in recent years, even during periods with differences in business climate 1  2  Report on the EMU investigation (SOU 1996:158). BIS Review 92/2001  between Sweden and the eurozone. As far as a Swedish membership of the EMU would reduce these differences in business climate, it will lead to a long-term interest rate development that is more adapted to the business climate. If we still believe that Sweden could become radically out of synch with the rest of Europe, there is of course an alternative to using an independent exchange rate and monetary policy as shock absorbers. The more robust budget situation Sweden enjoys today, for example, should provide a slightly greater scope than during the early 1990s for using fiscal policy for the purpose of stabilisation. One can also imagine building up buffer funds to pay for reduced payroll tax in crisis situations (known as internal 2 devaluation) of the type introduced in Finland.
Without wishing to anticipate this inquiry, let me just note that we should, as far as possible, manage problems before they arise. Finansinspektionen’s inquiry appears to be a step in this direction. The Baltic countries – more stable but still cause for concern One risk tied to the financial markets and which is particularly important to Sweden, is economic developments in the Baltic countries. Just a few weeks ago, we met here in the Riksdag Committee of Finance to discuss the Swedish banks’ commitments in Estonia, Latvia and Lithuania – what has happened in recent years, what we are expecting to see in the future and what we can learn from recent events. I do not intend to repeat what we talked about then, but can note that developments in the Baltic countries do appear somewhat brighter now than they did a while ago, but that the future is still very uncertain. One question that could affect the region as a whole is, for example, Estonia’s application to join the EMU. Loan losses in the Baltic countries are still increasing, which in turn has a negative effect on the Swedish banks’ profitability. We are counting on loan losses there peaking during 2010, but also on the Swedish banks being able to cope with the strains this will entail. An important element here is that the banks have increased their capital and thus their resilience to increased loan losses. The road ahead of us is not without problems.

The fact that the loans are falling due is of course included in our calculations when we assess how we will formulate our future monetary policy. Phasing out the loans is fairly undramatic. The measures will disappear, as I mentioned earlier; in principle this will occur automatically as the need for the measures disappears. The fixed-rate loans that currently have the longest maturities mature in the autumn 2010. At present we do not expect there will be a need to offer new fixed-rate loans at longer maturities beyond this horizon. But of course we are closely following developments in the financial markets, and are prepared to implement new such measures if necessary. The interest rate increases entail slightly more difficult considerations. For many central banks the question of timing is a difficult one. Withdrawing support measures and beginning to raise interest rates too early or too quickly may slow down the economic recovery in a sensitive phase. If the expansionary policy instead continues too long, there is a risk that inflation will be too high or that imbalances will build up, for instance, on the housing market or between different countries. Assets such as commercial property, but also residential property, have often played an important role in economic crises. There are links between house prices and the financial markets, not least through interest rates and lending. And low interest expenditure usually stimulates both credit growth and house prices, all else being equal. Considerations regarding the housing market...
Furthermore, our two-pillar strategy allows us to identify long-term risks to price stability and to financial stability at an early stage through our monetary analysis. In addition to our economic analysis, our monetary analysis examines not only the evolution of monetary aggregates, but also, in close detail, the dynamics of their components and of their counterparts, including the evolution of credit outstanding to categories of borrowers. This also brings potential risks to the stability of the euro area financial system to our attention. Question: But is that enough? BIS Review 1/2009  1  Answer: All central banks make a contribution to financial stability in their respective economic areas. And I would say that in our case macro-prudential matters are certainly part of our responsibility. Question: Is the same also true of banking supervision? Answer: The position of the ECB’s Governing Council has always been that a very close link between central banks and banking supervisory authorities is indispensable. One of the lessons of the first ten years of the euro, and of the recent financial market turbulence, is that if we can make an even greater contribution to the smooth functioning of banking supervision in general and in the euro area in particular – with regard to banking institutions with crossborder activities – this could be a sensible option. It has to be studied very carefully, and we will see afterwards what the position of the Governing Council will be. Question: The spreads on government bonds have widened considerably in the euro area.

The Objective of the FPC The UK government has proposed that the FPC’s main responsibility should be taking action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the UK financial system (my emphasis). “Systemic risk” is defined to embrace both faultlines in the structure of the financial system, ie the way its components are joined up; and cyclical threats from unsustainable levels of leverage, debt or credit growth. Two glosses on that are warranted. First, the government’s plan does not entail the FPC being held accountable for fine tuning the credit cycle, but rather for ensuring stability by maintaining the resilience of the financial system. An example might help. Say that in the face of a credit boom, the FPC raised banks’ capital requirements. That might help to slow the boom, and it would be helpful if it did so. But even if the boom continued, by virtue of having higher capital ratios the banking system should be more resilient when the bubble burst. If those FPC actions prevented the banks going bust, the downswing in the credit cycle, and so in the business cycle, would be less severe because the flow of credit services could be sustained. That would be a success. Perhaps not always a glorious success, but a whole lot better than where we are right now.
The Committee must balance the risk that a prolonged slowdown in domestic demand pulls inflation materially below the target against the risk that today’s high inflation rate becomes embedded in inflation expectations. During the past month, the balance of risks to inflation in the medium term shifted decisively  BIS Review 128/2008  3  to the downside. And the MPC – in an action co-ordinated with six other major central banks – cut Bank Rate by half a percentage point to 4.5%. Looking ahead, the outlook is obviously very uncertain – both for the world as well as our own economy. The MPC cannot simply extrapolate the past into the future. The prospects for oil and other commodity prices are difficult to assess. So too are the period over which bank lending will return to normal and the extent of the damage to business and consumer confidence. Moreover, the credit crunch affects not just demand but also the supply potential of the economy, complicating the assessment of the inflationary impact of changes in the level of demand. The associated shift of resources away from those parts of the economy that have flourished in recent years towards other areas of economic activity will moderate the increase in potential output while that adjustment is taking place. The MPC must monitor carefully all the available evidence about fast-changing patterns of spending, supply and prices. It will act promptly to ensure that inflation remains on track to meet our target.

In itself that  2  BIS Review 128/2008  does not affect the ability of banks to fund lending, but confidence has been badly shaken after the traumatic events of the past few weeks. New sources of funding will develop only slowly, although the temporary government guarantees of new lending to banks will help. So it will take time before the recapitalisation leads to a resumption of normal levels of lending by the banking system to the real economy. And we cannot assume that there will not be problems in other parts of the financial system and in some emerging market economies to be overcome before the crisis can truly be described as over. With the plan for recapitalisation in place, the focus of attention has moved to the outlook for the UK and world economies. Over the past month, the economic news has probably been the worst in such a short period for a very considerable time. The most recent activity indicators for the second of half of the year have fallen sharply. In the UK, unemployment continues to rise and, over the past three months, has risen at the fastest rate for seventeen years, albeit from a relatively low level. House prices declined by about 5% in the third quarter and are 13% lower than a year ago. The recent weakness of the housing market is likely to continue. And if the news on the domestic front were not sufficiently discouraging, the rest of the world economy also appears to be slowing rapidly.
Norges Bank has been given an operational target for monetary policy, which means that monetary policy instruments shall be used with a view to maintaining low and stable inflation. The inflation target is set at 2½ per cent. Low and stable inflation is probably the best contribution monetary policy can 9 make to financial stability. This is also supported by empirical studies. However, there have been episodes where bubbles have accumulated in the form of sharp increases in asset prices in the property and financial markets while inflation has been low. Developments in Japan in the 1980s and in the US in the 1990s may be examples of this. When the bubbles burst, the result may be an economic downturn. Thus, developments in the financial and property markets may also fuel more unstable inflation. In principle, it might be appropriate to use the interest rate to counter this. In practice, however, it is difficult to assess whether developments in prices for property and financial assets are sustainable. When Norges Bank concludes that the key rate should be changed, the change will in most cases be made gradually. If special emphasis is placed on developments in financial or property markets when the key rate is changed, Norges Bank will provide an assessment of this. It is Norges Bank’s responsibility to present its view on the risks facing the financial system from a macroeconomic perspective. This is the purpose of Financial Stability, a report published twice a year. Second, the international financial infrastructure must be strengthened.

Mr George’s closing speech at the Euromoney International Bond Congress Speech by the Governor of the Bank of England, Mr E A J George, at the Euromoney International Bond Congress in London on 10/02/99. Thank you, Padraic. I wasn’t quite sure what you had in mind when you asked me to wind up this Congress once again this year. I couldn’t remember what I’d done to wind you all up last year! But I am happy to join you anyway at what has become – in five short years – an unmissable event in the calendar for anyone with an interest in the international bond markets. And what an extraordinary year it’s been since we all last met here. Despite all the upsets – beginning in Asia, then Russia and most recently Brazil – which had everyone scrambling for liquidity and desperate to reduce risk, it proved, on IFR’s figures, to be a record year for international bond issues, with total issuance rising by some 17% to over a trillion dollars equivalent. That can’t have been bad for fees! And altogether it suggests you had a pretty good year – apart from those of you who chose to go on holiday in August leaving someone else to look after your long positions in Russian bonds. Inevitably issuance by emerging market economies fell away, but issuance by supranational and sovereign borrowers in aggregate still accounted for some 30% of total issuance.
Further details are available at: www.theice.com/publicdocs/ICE_LIBOR_Methodology.pdf 4  8  All speeches are available online at www.bankofengland.co.uk/news/speeches  8  corporate borrowing, and underscores the pressing need to complete the transition away from LIBOR by end-2021. By contrast, volumes underpinning SONIA, the market’s preferred alternative sterling risk free rate, rose sharply, as investors sought safer havens. Chart 9: 3m £ submission composition Transaction-based Transaction-derived Expert judgement  Chart 10: CCFF usage and capacity Commercial paper purchases under CCFF, less redemptions CCFF drawing capacity  Per cent 100  £ bn 70  90  60  80 70  50  60 ‘Dash for cash’  40  50 30  40 30  20  20 10  10 0 Oct 19  Dec 19  Feb 20  Source: IBA. See footnote 4 in the text for definitions of the data shown. 0 23 Mar  06 Apr  20 Apr  04 May  18 May  Source: Bank of England. Dashed lines show linear interpolation between launch date and first public data release. Moment 5: keeping funding flowing to UK companies Although most of my remarks have been about stabilising the financial system, the ‘dash for cash’ was of course just as prevalent in the corporate sector – and the stakes just as real. Otherwise-viable companies, cut off from their normal sources of income but still needing to meet salaries, rent and taxes, feared losing access to finance, forcing them to eat into their cash buffers or start winding themselves up.

And the trigger for conversion from debt into equity could be at a margin of comfort away from true catastrophe; say, a percentage point or so above the minimum regulatory capital ratio. Of course, this would entail a structural shift over time in investment portfolios. But the system might be able to manage that adjustment. After all, it managed the all together less desirable adjustment to the development of the existing hybrid capital markets. But demand for contingent capital is, inevitably, uncertain at this stage. As are the terms on which it will be provided. We welcome the growing private sector focus on this. 4  King Mervyn A. (2009), “Speech by Mervyn King, Governor” to Scottish Business Organisations, Edinburgh, October 2009. See also Tucker P M W (2009a), “Remarks by Paul Tucker”, Panel session at the Turner Review Conference, London, March 2009 (pp. 5) and Tucker P M W (2009b), “The repertoire of official sector interventions in the financial system: last resort lending, market-making, and capital”, Bank of Japan’s 2009 International Conference, Tokyo, May 2009 (pp. 19). In the academic community, the idea was aired in “An Expedited Resolution Mechanism for Distressed Financial Firms: Regulatory Hybrid Securities”, Squam Lake Working Group on Financial Regulation, April 2009, Council on Foreign Relations. Dudley, William C. (2009) “Remarks by William Dudley” at the Institute of International Bankers Membership Luncheon, New York City, October 2009.
Accordingly, we expect to enhance the bank examination methodology to 19  focus on the efficiency, effectiveness  2014 with a view to further  and sustainability of individual banks and  strengthening the resilience of licensed  the banking sector, based on the Bank  banks. We have already issued Directions  Sustainability Risk Index (BSRI). on the Basel III Liquidity Coverage Ratio  Accordingly, amendments will be  in April 2015.  introduced to the existing risk-based supervision framework based on a mix of quantitative and qualitative indicators to enhance focus on sustainability and operational efficiency of banks. We will conduct the pilot run of the Risk Index on large banks during  We have just issued the Direction on Basel III Minimum Capital Requirements for implementation on a staggered basis, commencing 01 July 2017, and to be fully implemented by 01 January 2019 in line with the international timeline. the first quarter of 2017 and  With a view to creating a more resilient  subsequently, the index will be extended  banking sector, we expect banks to  to the other segments of the banking  maintain a stable funding profile. sector. Accordingly, we plan to introduce the  In 2018, the Risk Index will be incorporated to all examination reports and we intend to assign a supervisory rating, based on this index. By 2019, a comprehensive pre-risk assessment will be conducted for all banks and a riskbased examination plan will be formulated.

the government on organic  In line with the international appetite to  agriculture, mainly due to the  promote green financing, the Central  multiple benefits that accrue from it,  Bank has also joined the Sustainable  the Central Bank expects to promote  Banking Network (SBN) of the  commercial scale organic agriculture  International Finance Corporation (IFC),  and dairy entrepreneurs through the  which is a knowledge and capacity  establishment of formal agribusiness societies and multi-stakeholder enterprises. building platform for financial regulators and banking associations of emerging markets on sustainable finance. As a   A Loan Scheme for Promoting Rooftop  member of the SBN, we would focus on  Solar Power Generation: A new loan  sustainable banking practices to help  scheme, funded by ADB, will be  banks to effectively manage  Central Bank of Sri Lanka – ROAD MAP 2017  31  environmental and social risks in the  finance, with the support of IFC, we  projects they finance and support  intend to conduct a workshop for the  businesses that are greener, climate  senior staff of banking institutions in Sri  friendly and socially inclusive. As an  Lanka during the first quarter of 2017.  important step towards sustainable  Central Bank of Sri Lanka – ROAD MAP 2017  32  6.