samchain/econo-pairs-v1 huggingface dataset:
Quite apart from the more general uncertainties, there have inevitably been a series of surprises (or "shocks" in the jargon) - including a persistently stronger than expected exchange rate against the euro, pronounced swings in the oil price, or varying rates of increase in excise duties, for example, any of which can have a significant and persistent impact on the out turn. That's not a matter of selfjustification - it may well be more by luck than judgement; to be honest I'm more interested in the result. But I am concerned that people should understand that operating monetary policy is an inevitably imprecise process, and that they should not expect from it more than it can deliver. But however that may be, the even better news is that since 1992, stable, low, inflation has been accompanied by steadily increasing overall output and employment, and by a progressive fall in the rate of unemployment. Over the same period, to the fourth quarter of last year, GDP growth averaged just under 3% a year which is well above most estimates of our trend rate of 2¼%-2½%. GDP had in fact grown for 37 successive quarters which is the longest period of sustained quarter-by-quarter growth we have enjoyed since quarterly records began in the UK in 1955. Employment has increased steadily from a low point of 25½ mn people in the Spring of 1993 to its current level of 28 mn.

And the rate of unemployment fell from a peak of over 10½% on the LFS measure to around 5% last summer; on the claimant count measure it fell from some 10% to just over 3%, which meant that the number of people claiming unemployment benefit, at under 950,000, was the lowest for 26 years. Short-term interest rates are at a 38-year low. All of that it seems to me gives the lie to a view that was quite widespread a decade ago, that sustained low inflation would inevitably mean continuous suppression of the real economy. I'd go further myself and suggest that it provides considerable positive support for the central bankers' credo. Now some of you - given what's been happening to your own businesses, to certain particular business sectors, and in regions of the country where those sectors are particularly heavily concentrated - may think that I've been living on a different planet. The problem is - and it is a real problem - that with the best will in the world macro-economic stability, the stability of the economy as a whole, cannot guarantee stability at the more micro-economic level: it can not guarantee the prosperity of every individual business or even of whole business sectors or geographic regions.
The Struggle to Fill Jobs In the current environment, filling jobs can be a challenge. Employers-including those here in Columbia and Greene Counties-are facing significant worker shortages. Many are struggling to hire people, especially at the entry level-in construction, nursing, and manufacturing. The skills gap is a big obstacle. In 2020, more than half of available job seekers in Columbia and Greene Counties had a high school diploma or less, and only a quarter had an associate degree or higher.1 Employers, especially those in trucking and the trades, grapple with developing a pipeline of skilled workers. An aging population is another issue. Over the past 20 years, the size of the workforce here has declined as the population has stagnated. Residents here are older-the median age is late 40s, as opposed to late 30s for all of New York State. In some cases, residents don't need more training-they need retraining so they can obtain new jobs. 1/3  BIS - Central bankers' speeches  The Jenga Tower Whenever I talk about economic prosperity, I like to use the analogy of a Jenga tower: Each piece is critical to the stability of the whole. Take one piece out, and the tower becomes unstable. Take the wrong piece out, and the whole tower can collapse. Our Jenga tower encompasses a whole host of important pieces. Job training is one. Workers need skills that employers are looking for, and job training needs to be accessible. Transportation is another.

4 Federal Reserve Bank of New York, Employer Engagement by Community Colleges  in New York State, November 2018. 5 Andrew Dumont, Investing in Rural Prosperity: A Framework for Advancing Economic  Resilience and Opportunity, May 19, 2022. 3/3  BIS - Central bankers' speeches
Between 1997 and 1998, countries of South-East Asia experienced this effect, when all of a sudden capital flew out, bringing about financial crisis in economy after economy, which could not be prevented by either the monetary or exchange rate policy. Re 4) One of the vital dimensions of globalisation is the fast spreading of knowledge, technology and knowhow. The flow of know-how also applies to the public sector, including the central bank. One of the features of modern central banking is gradual homogenisation of the strategies applied to the monetary policy. Since 1990, when for the first time the central bank of New Zealand started to implement the strategy of direct inflation targeting (DIT), over 20 central banks followed and adopted that strategy. As a result, the DIT strategy (applied since 1998 by the NBP) is now the dominating strategy of the monetary policy, applied by the majority of central banks in developed countries 22 , and more and more, by central banks of the developing countries (such as Turkey, the Philippines, Ghana, Romania and Armenia). A bloom of the DIT strategy endorses the observation that central banks adopt the “technology” of low and stable inflation from one another. The dissemination of the DIT strategy was accompanied by a decrease in the average inflation level, especially in the developing countries that lowered inflation from a high level. This may prove that the dissemination of the DIT strategy was one of the factors that have contributed to disinflation.

From 1990 to the end of 2001 the ratio of foreign exchange deposits to total deposits increased from the level of 25.5 percent to 57.6 percent; the share of foreign exchange deposits in broad money supply went from 19.7 percent to 55  6  Arteta, C. O. (2002); “Exchange rate regimes and financial dollarization: does flexibility reduce bank currency mismatches?” International Finance Discussion Papers 738; Board of Governors of the Federal Reserve System. 7  Frankel J.; Schmukler S.L. ; Serven L. (2004); “Global transmission of interest rates: monetary independence and currency regime”; Journal of International Money and Finance; Vol.23 p.701-733. 8  Cowan, K.; Quy-Toan Do. (2003); ”Financial Dollarization and Central Bank Credibility”; World Bank Policy Research Working Paper No.3082. BIS Review 124/2006  3  percent. Similarly as of 2001, the share of foreign currency loans in the total loans of the banking sector reached to 47.2 percent, while the share of foreign currency denominated and indexed debt of the government in its total domestic debt increased to 36 percent 9 . As of 2001 Turkey became one of the most dollarized economies in the world. Distinguished Guests, Dollarization process in Turkey has two striking characteristics. First of all, dollarization rose significantly even the real rates of return on foreign exchange deposits were lower than that on the Turkish currency deposits. This indicates the fact that the political and macroeconomic instability in the country, particularly high inflation and inflation uncertainty, had played the major role in the dollarization process.
With this approach, firms have an obligation to share relevant and significant issues around the globe with key host country supervisors on a timely basis. As well, firms need to share more global data – including key risk management reports – that allow host supervisors to better understand important vulnerabilities, as well as the overall condition of the firm. While information sharing among supervisors can address some of this, it’s insufficient to assume that key host country jurisdictions don’t need to have a view of the overall health of the company. And, finally, clarity – or transparency – of communication with supervisors needs to be a focus going forward. There are times when firms attempt to respond to questions or concerns with very narrow answers or with an overwhelming amount of paper. This generally leads to additional follow up – on both sides – and a lot of time and energy expended to resolve the outstanding questions. I encourage you to ask for clarity when we aren’t being clear and to try to understand better what we are looking for by asking more questions. One way that you can facilitate better information flows is to provide us with what you provide to senior management and board members, rather than producing something just for us. •  Second, invest in MIS. One of the key weaknesses identified during the last crisis was that information systems within firms weren’t robust enough to provide timely and accurate risk management information as events unfolded.

Government bonds were swapped for covered bonds issued by banks and normal lending activity was restored. However, this was not the first time the Government had used swaps to stimulate the real economy. We did so around 200 years ago...  A swap of government bonds for privately issued securities was used already in 1819 when Norway emerged on the scene as a sovereign country after the Napoleonic wars. The 1819bonds were swapped for bills of exchange issued by farmers and merchants in the domestic market. With these bonds as collateral they managed to raise sufficient credit to import seed to secure important supplies to farmers and merchants in this difficult period in Norwegian economic history. This is a historical example of how financial markets underpin economic growth. BIS central bankers’ speeches  1  More generally, financial markets contribute to economic growth in three ways:   They create credit to make it available for real investment.   They allocate credit to the most profitable investment projects.   And they improve risk sharing in the economy. The caveat is that they create the credit volumes that they find privately optimal, and allocate it to the projects that are most profitable to them. Neither the credit volume nor the credit allocation is necessarily socially optimal: this is one basic reason why financial markets are and should be regulated. The next question is: How strictly should they be regulated? When does regulation severely impair the positive effect from financial markets to economic growth?
Øystein Olsen: How central banks influence interest rates Speech by Mr Øystein Olsen, Governor of Norges Bank (Central Bank of Norway), at the Centre for Monetary Economics (CME) / BI Norwegian Business School, Oslo, 1 October 2015. *  *  *  Please note that the text below may differ from the actual presentation. Accompanying charts can be found on the Norges Bank’s website. Introduction A number of items appear on my calendar every year. Today’s speech is one of them. Three years ago, the speech was entitled “Monetary policy in turbulent times”. The theme was how central banks worldwide were adopting new approaches to the conduct of monetary policy. Chart: International yield curves Three years later, this theme has not lost its relevance. The list of countries that have adopted quantitative easing has grown longer. Policy rates in some countries have fallen below the zero lower bound, and we have seen examples of negative yields on bonds. This has challenged a long-held belief – that the lower bound for nominal rates is zero. The measures have a common goal, which is to bring down market interest rates and keep them there until a firm economic recovery is achieved. By influencing interest rates on financial contracts of varying duration and risk, monetary policy seeks to stabilise inflation and stimulate output and employment. In this speech, I will take a closer look at how policy rates affect money and financial markets and the impact of the unconventional measures implemented.

It is difficult to judge to what extent the recovery abroad can be attributed to the monetary policy that has been conducted. There is, however, little doubt that it has had a positive effect. Lower interest rates have given firms and households access to cheaper funding. It has also eased the interest burden for heavily indebted borrowers and contributed to growth in disposable income. In addition, the value of households’ financial wealth has increased. This may also have provided a basis for higher demand. Studies conducted so far also suggest that the unconventional measures have had an effect. 13 A study by the Federal Reserve suggests that the Fed’s asset purchase program has reduced unemployment by 1¼ percentage points and increased inflation by ½ percentage point. 14 The Bank of England estimates that the Bank’s purchases of government  12  Jordà, O., M. Schularick and A. M. Taylor (2013): “When Credit Bites Back”, Journal of Money, Credit and Banking (45), 3–28. 13  IMF (2013): “Global impact and challenges of unconventional monetary policies”. IMF Policy Paper, October 2013. 14  Engen, E. M., T. T. Laubach and D. Reifschneider (2015): “The macroeconomic effects of the Federal Reserve’s unconventional monetary policies”, Finance and Economics Discussion Series, Federal Reserve Board, Washington D.C.  BIS central bankers’ speeches  7  bonds from 2011 to 2012 boosted GDP by just over ½ percent. The effect on inflation was also found to be positive.
This means that enhanced information disclosure required by Basle II, could be problematic if not supported by a proper public understanding. That’s why I feel a bit concerned about the effectiveness and appropriateness of an immediate implementation of Basle II. Therefore a more gradual approach may be necessary. This approach could take the form of an interim standard between Basel I and Basel II that could offer banks in emerging market economies some of the benefits of Basel II without having to face a prohibitive cost. This means that Basel II adoption should not be made mandatory in financial assessments (of WB, IMF for example) and countries should be left with the option to keep Basel I. EU banking directives are mandatory for our countries that opt to join EU. As Basel II elements are embedded in EU Directives, and as our countries are making progress toward integration in the EU, we shall be faced with the challenges of Basle II implementation. I’d like to point out three challenges in particular. Albania as many other East European Countries host a considerable number of foreign banks. These consist mostly of branches or subsidiaries of banks from EU countries which eventually may have to implement the new system including its most advanced elements if their head offices decide to adopt it throughout the network for consistency and competitiveness reasons.

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Moreover, we assume that electricity tariffs will be adjusted as required by the automatic pricing mechanism. These changes imply upward revisions in our forecasts by 0.9 points for end-2008, and 0.4 points for end-2009. Although weak domestic demand should limit the second round effects of the exchange rate pass-through, the first round impact of the recent depreciation is estimated to be close to 2percentage points at the end of 2008, which implies further upward revision in our forecasts. Within the framework that I have drawn up so far, we now forecast inflation to be around 9.3 percent at the end of 2008. Our medium term forecasts suggest, with 70 percent probability that, under the assumption of a measured and gradual tightening towards mid-2008 and constant policy rates thereafter for the rest of 2008, inflation will be between 4.9 and 8.5 percent (mid point 6.7) at the end of 2009 (Figure 14). Assuming a gradual moderation in food inflation, headline inflation is expected to decelerate to 4.9 percent at the end of 2010 and to 4 percent by mid-2011. We expect non-food inflation to be lower than these figures.

I would once again like to emphasize that any new data or information on the inflation outlook may lead to a change in the policy stance of the Central Bank. Therefore, the indicated path for the policy rates should not be perceived as a commitment on behalf of the CBT. Distinguished Guests, Revised projections suggest that the contribution of energy, food and services will be close to 5 percent at the end of 2009. In other words, assuming no further hikes in administered prices (except those implied by automatic pricing mechanisms), meeting the 4 percent target at the end of 2009 would be possible only if the prices of goods excluding food, energy and tobacco deflate by 3 percent. However, factors such as rising import prices, potential second round impacts of supply shocks, and the structural inertia in inflation could continue to impose downward stickiness in goods prices. Therefore, converging to the medium term target of 4 percent may extend beyond two years, even when tight monetary policy is maintained for an extended period. Under these circumstances, getting inflation back to the 4 percent by the end of 2009 would require offsetting the first round effects, and thus create undesired fluctuations in economic  BIS Review 62/2008  11  activity and relative prices. That is why we envisage a framework in which inflation remains higher than 4 percent at the end of 2009. The forecasts presented above deserve particular attention, given that inflation is likely to stay above the target in the next two years.
According to the new regulation, “the operational target of monetary policy shall be annual consumer price inflation of close to 2 percent over time.” It is not possible to quantify precisely an optimal inflation target for the Norwegian economy. A numerical target of 2 percent is, however, consistent with the inflation target of most of Norway´s trading partners. In 2001, when inflation targeting was introduced, the Norwegian economy faced the prospect of gradually increasing oil revenue spending. It was widely expected that the phasing-in of revenues would entail an appreciation of the real exchange rate. At the time, the nominal target was set at 2.5 percent. An expected real appreciation could then occur partly in the form of wider price and cost differentials between Norway and its trading partners. The period of rising oil revenue spending now appears largely to be over. Thus, it is difficult to find compelling arguments for setting an inflation target in Norway today that differs from that of our trading partners. The new regulation is consistent with how monetary policy has been conducted in practice in recent years. The regulation states that: “Inflation targeting shall be forward-looking and flexible so that it can contribute to high and stable output and employment and to counteract the build-up of financial imbalances.” As long as there is confidence that inflation will remain low and stable, monetary policy can contribute to stabilising the economy.

When the economy is exposed to shocks, the central bank can respond rapidly by adjusting the key policy rate, as we did in 2008 and when oil prices fell in 2014. A flexible inflation targeting regime can reduce the risk of unemployment becoming entrenched at a high level following economic contractions. Nevertheless, monetary policy cannot assume primary responsibility for high output and employment. The level of output and employment over time depends on overall economic policy, including the tax and social security system, the wage formation process and the functioning of the labour market. Monetary policy is only one component of such an overall framework. 2/4  BIS central bankers' speeches  The importance of financial markets and financial stability was underestimated before the crisis – also by central banks. The financial crisis revealed how harmful financial imbalances can be. Monetary policy can in given situations take account of the risk of a build-up of financial imbalances. But monetary policy cannot take primary responsibility for heading off a gathering storm. Regulation and supervision of financial institutions are the primary means of addressing shocks to the financial system. The build-up of financial imbalances has in recent years been given little weight in monetary policy among the major central banks. Their focus has been on counteracting a deeper and more prolonged downturn and on preventing deflation. In countries that were less affected by the financial crisis, more attention has been devoted to financial stability considerations. In high-tech, global financial markets, capital moves rapidly between different currencies.
Also from a European perspective, I believe that the EU should seek to implement the trading book changes at the same time as other major countries. Moving now to the second initiative, the Basel Committee has long intended to conduct work to re-confirm that the new framework meets our objective to broadly maintain the aggregate level of capital requirements, while keeping incentives to adopt the more advanced approaches that are offered. In order to establish a common data set on which to base this review, the Committee has decided to begin a recalibration exercise in autumn this year, some months earlier than anticipated. As I said earlier, I don’t believe that this will imply a significant change to the framework. We are already satisfied that the new capital framework clearly differentiates the degree of risk in particular transactions on a relative basis. What we need to confirm is that the absolute requirements are right and that the appropriate incentive structure is maintained. 5. Conclusion  In my testimony today, I have sought to outline the reasons why Basel II matters so much and how it will support the continued safety and soundness of the banking system. When we motivate banks to improve their understanding and approaches to risk, I believe that banks will become less sensitive to the ups and downs of the business cycle, better able to weather periods of distress and better able to serve as a source of credit and growth to the economy.

It will help to avoid redundant and unco-ordinated approval and validation work, thereby reducing the implementation burden on banks, and conserving supervisory resources. In this regard, the Committee’s Accord Implementation Group continues to encourage practical work among supervisors on applying Basel II effectively and efficiently to internationally active banking organisations. The AIG is currently working with supervisors of different areas of the world to conduct a number of “real case” studies to gain better insight into the practicalities of co-operation between home and host supervisors. In this context, if you will permit me, I would like to speak from my perspective as a European banking supervisor, and pick up on the statement I made at the beginning of my intervention. As I said, I believe that Europe is in a unique position to lead the way in the cross-border implementation of the  BIS Review 3/2005  3  new framework and to make faster and more tangible progress than is currently possible on a wider international basis. I think we need to seize this opportunity with both hands, because it will not just benefit us in the EU, contributing to the fulfilment of the Lisbon objectives, but, I believe, will also have a positive impact beyond our borders. We have two major advantages in this respect. Firstly, the division of supervisory responsibilities between our countries is embedded in our common single market legislation in the banking field, founded on harmonisation and mutual recognition.