samchain/econo-pairs-v1 huggingface dataset:
At 125 grams per capita, Switzerland has the largest gold reserves per head of population of any country – triple those of Germany and quintuple those of the US (left-hand side of slide 8). The SNB’s gold reserves have remained constant in recent years and it has no plans to sell its holdings. The value of our gold reserves has thus moved in line with the gold price in recent years (right-hand side of slide 8). However, given the substantial increase in the SNB’s foreign exchange reserves since 2009, the share of gold as a percentage of total currency reserves has indeed changed, recently falling to just below 8%. Now let us turn to the gold initiative, which goes to the vote in just a few days. The supporters of this initiative are demanding that the SNB hold at least 20% of its assets in gold and at the same time requiring a ban on ever selling gold again. Moreover, the initiative demands that the gold must be stored exclusively in Switzerland. In order to achieve the share of 20%, the SNB would have to almost triple its gold holdings within five years. In practice, given today’s balance sheet total and gold price, the SNB would have to purchase 4  BIS central bankers’ speeches  around CHF 70 billion worth of gold – around two-thirds of the world’s total annual gold production. The SNB considers the initiative to be unnecessary and harmful. Its legal mandate is to ensure price stability.

Banking supervision was not always tasked to the central bank, with many central banks lacking a clear mandate for macro prudential policies. As it comes to advanced economies, the common practice before the crisis was generally characterized by separation in responsibilities with respect to monetary policy and banking supervision, delegating each function to a different regulator. Looking at EU, the integrated model of supervision was predominating across the member states, capturing the form of unified financial and banking oversight under one single national authority, but generally, not the central bank. The situation was quite different in emerging countries where central banks tended to be the main micro prudential supervisor for banks. In response to the crisis, there was a visible convergence in both, advanced and emerging economies, towards integrated supervision under the common roof of the central bank, usually by using the “new” formula of  BIS central bankers’ speeches  1  macro-supervision. The role of sound supervision was endorsed as absolutely vital for promotion and maintenance of healthy financial system, while central banks got recognized as leading protagonists in the area of prevention, management and resolution of financial crises. Thus, in 2010, the US has passed the Dodd-Frank Act redesigning the role of FED in financial supervision, while in EU there is an ongoing process towards a banking union assigning banking supervision to the ECB together with the national supervisory authorities of the participating member states.
But, more importantly, there is a political pressure towards it, driven by populist impatience that would like to have a lot, right away. For a number of years this impatience has been hindering long-term efforts in the form of fiscal consolidation and structural reforms, and these have unfortunately slowed in G20 countries. When we compare the performances of our different European Member States, it is clear that debt and public spending are not the engines of growth. There is a need today for fiscal stimulus in those countries that have surpluses, and for structural reforms across the board: without this there can be no sustainable growth. On this issue, I would just like to say a word on France, which has stood out as a positive exception over the past two years: the gilets jaunes (yellow vest) crisis provided justification for an emergency “package” to bolster purchasing power; but I do not think it should or even could halt the transformation efforts already underway. Lastly, and this is our third challenge, isolationism, characterised by the escalation of trade tensions, constitutes the biggest short-term threat to global growth. Even before the tariff hikes, the uncertainty caused by protectionist stances, essentially on the part of the United States, already appears to be threatening growth via its impact on business investment. More broadly, uncooperative economic strategies – including within Europe – are on the rise.

The increased public investments in the infrastructure, provided by still comfortable fiscal position (the budget deficit was on average 3% of GDP during the crisis and the government debt is at 34% of GDP, the forth lowest in the Europe) are additional factor for growth. However, although the negative spillover effects of the global and Euro zone crisis to the trade, remittances and FDI’s could be diminished as Euro zone recover, still, the financial system of our SEE countries, that is broadly based on banks, is exposed to the risk of disruptive withdrawal of funds by European banks. Thus, when we assess the crisis’s impact on the financial system in our economies, we should distinguish the two phases. In the first phase of the global crisis, the negative spillover effects were pronounced on the local capital markets, with large portfolio withdrawals by institutional investors. On the other side, in that time, the Vienna Initiative has prevented a systemic banking crisis. However, with the new wave of the Eurozone crisis (extended at the end of 2011), there are many new challenges for SEE countries that should be rightly followed by Vienna Initiative 2. Concerns with respect to Euro zone banks’ deleveraging, due to new capital requirements by the EBA are materialized. The deleveraging by the Euro zone parent banks have affected the SEE credits’ developments and now there is new concern regarding to the upcoming asset-quality review and stress test of the Euro zone banks that could lengthen this process even further.
According to 2009 figures, labor force participation rate in developed economies is above 70 percent. This rate is hovering at around 60 percent in Eastern European countries. Although the labor force participation rate has surged by 3 percentage points in Turkey, it still remains low, at 49 percent. We see that the limited increase in this period was mostly attributable to the rising trend of labor force participation among the female population. Government incentives for social security contributions oriented towards newly recruited women and young people, which have been in place since 2009, are very influential in this development. Nevertheless, at 28 percent, the female labor force participation rate in Turkey is very low compared to European countries. While the labor force participation among females with a university degree converges towards the EU average, with a ratio of 71 percent, only 23 in every 100 women with a high school or lower education participate in the labor market. Regulations to be implemented in the labor market in the forthcoming period will contribute to sustainable growth and an increase in employment on a permanent basis. Within this scope, it is essential that:   Flexibility of the labor market should be increased,    Competition within the private sector is promoted,    Pay-roll taxes are reduced, and    Necessary policies for establishing an educated and qualified labor force, which will accommodate private sector requirements, are followed.

Moreover, the effects of these reforms will emerge slowly and gradually. However, this is the only way to ensure permanent economic welfare. Monetary policy does not have a lasting effect on the long-term growth performance of the economy other than the benefits of establishing and sustaining price stability. The Central Bank will continue to make a concerted effort to achieve price stability as per the duties and responsibilities entrusted by its Law. BIS Review 104/2010  5  I would like to end my remarks by extending my regards to all participating academicians and policy-makers for their valuable contributions to the “World Business Congress of the International Management Development Association”. Also, I would like to thank, once more, the members of Karatay University their contributions to the conference. 6  BIS Review 104/2010
Interest rates have subsequently declined. The financial position of households is solid, and as a group they will be able to bear higher interest rates. If households reduce saving because house prices rise, their vulnerability may increase. Some indicators show that house prices are in real terms at the peak level recorded in the 1980s. Bank losses have been unusually low for several years. We expect losses to return to a normal level in the period ahead as a result of weaker cyclical trends. We have also seen an expansion in credit to “weak” enterprises. So far, we have not noted an increase in losses or non-performing loans. Nor have the banks increased loss provisions. The increase in long-term debt in high-risk enterprises would indicate, however, that loss provisions should be increased in the near future. Over the last few years, banks have accumulated substantial short-term external debt. Although this debt has gradually been converted into more long-term debt, there is a liquidity risk associated with the debt. When banks encountered problems with refinancing their foreign debt during the banking crisis, Norges Bank intervened with support. As Norges Bank has done on previous occasions, I would warn the banks against assuming that this will again be the case if similar problems should recur. There is some fear in financial markets that a liquidity shortage may occur around the year 2000 in connection with the Y2K problem. This is reflected in money market rates.

Mr Gjedrem focuses on the issue of financial stability: experiences and challenges  Speech given by Mr Svein Gjedrem, Governor of the Central Bank of Norway, at the annual meeting of the Norwegian Savings Banks Association, held in Sandefjord on 21 October 1999. (Shortened version) 1. Introduction  Every day around NOK150–200 billion change hands through the banks’ accounts in Norges Bank. In the course of a week, payments corresponding to our gross national product for an entire year have passed through Norges Bank’s settlement system. These payments involve all types of transaction, from a 10 kroner ice cream purchase to securities transactions where a single transaction may involve billions of kroner. The banks play a pivotal role in the payment system. Deposits are now the predominant means of payment. Payment settlement is the banks’ most important function besides channelling funds from savers to borrowers. In other countries, securities markets are of growing importance. They are taking over an increasing share of banks’ credit intermediation. This may also occur in Norway. Securities are also increasingly serving as collateral in payment settlement. These three elements - payment and settlement systems, banks and other financial institutions, and securities markets - make up the financial system. Every day we experience how dependent a developed economy is on the smooth functioning of this system, i.e. on financial stability. The volume of foreign payments is substantial and on the rise. Banks and securities markets are becoming ever more closely integrated.
The aim is that the banks must reduce the differences in maturities between their assets and liabilities and their dependence on shortterm market funding. To achieve this, the banks must match their funding and lending to a greater extent than they do today. Assets with short maturities can have short-term funding while long-term illiquid assets, such as mortgages, will need more long-term and stable funding. All funding with a remaining maturity of more than one year will be counted as stable funding. This is a sound and important feature of the new Basel regulations. And it will probably affect the Swedish banks’ business models. Currently, none of the four major Swedish banks meet the structural liquidity measurement requirements (Net Stable Funding Ratio). This is mainly because they largely fund their lending through short-term market funding. The banks will need to think again here. In addition, a number of the Swedish banks do not meet the shortterm measurement (Liquidity Coverage Ratio) either. These banks must, before the LCR is introduced, either strengthen their liquidity buffers, for example by buying government bonds, or reduce their short-term net outflow. A weakness of the new standards is, however, that they do not contain any specific rules for matching maturities per currency. This is something Swedish authorities should look at more closely. Two thirds of Swedish banks’ market funding is in foreign currency. A certain proportion of this is converted via the swap markets to SEK and then lent.

The collapse of Lehman Brothers is just one of many examples of how a bank with problems in one country can constitute a threat to banks all over the world. The crisis revealed the lack of effective regulations In an increasingly globalised world it is important to have well-designed global rules and regulations that contribute to stable financial sectors in all countries. It has been obvious for quite some time that this is not the case. But a crisis was required to eradicate any doubts that reforms are necessary. This is a good aspect of crises. They have the capacity to unite decision-makers and to provide an impulse to processes for change. BIS central bankers’ speeches  1  Consequently, over the last two years, considerable resources have been devoted to determining why the crisis arose and how we can reduce the likelihood of a similar crisis occurring in the future. Politicians and decisions-makers have left almost no stone unturned. They have discussed everything from bonus systems and the role of accounting in the financial crisis to shortcomings in financial supervision and weaknesses in derivatives trading. Above all, however, they have discussed bank regulation. As a result they have realised that the current regulatory framework has a number of fundamental weaknesses that must be dealt with. The Basel Committee 1 has therefore drawn up new, revised regulations for capital and liquidity, the so-called Basel III regulations.
This is the immediate task ahead because we need to do all we can to clear up uncertainty here. Before going on, let me deal with two points that are related to this argument. First, it is said that this stance on capital is unnecessary because banks have stronger capital positions now than they did in the height of the crisis. This statement on the capital position now relative to the past is true but on its own that part does not tell us whether they have enough capital now. UK banks have made substantial progress over the last four years in building their resilience, but from a low base, it has to be said. There is further to go, but we should not forget the distance that has been travelled. The second point I want to deal with here concerns forbearance, namely the extension by banks of a variance in the terms of loans, which involves forgiveness of various forms. It is easy to imply that forgiveness is a bad thing, turning Japanese in the unfortunate sense of that term. Rather, we should deal with the consequences of forgiveness, not prevent it. The reason for that is because forgiveness has a very good side to it, namely that fewer jobs are lost and fewer homes re-possessed where it takes place. And we can see evidence of both of these in the latest recession relative to previous ones.

These two objectives contain the same “subject to that” language used in 1997 in the Monetary Policy Committee’s objectives. It means that there is a hierarchy of objectives which the FPC must observe. But, two further points are relevant here. First, resilience and economic growth interact, so they are not fully independent. An economy that displays stable growth is more likely to have a stable financial system, and vice versa. Second, policy is necessarily forward-looking, in that we are concerned with stability and growth in the future, since today’s outcomes are so to speak, “baked in”. This means that, in thinking about the hierarchy of objectives, in my view we have to take a forward-looking assessment of the probability of success, rather than saying we should complete one and then do the other. Financial stability is more complicated than monetary policy in at least one respect, namely that it does not reduce to a single target expressed as a number. Rather, it comes in the form of recommendations, in the plural, expressed as words. You would think that as central bankers and public officials we should love that, spending our time crafting language in a form that only we really understand. Let’s not get carried away here – there is a danger that  BIS central bankers’ speeches  1  by doing so we create uncertainty about our intentions. This danger of creating uncertainty exists because we are finding our way in a new and difficult area of policy.
That tension between monetary and financial stability is best managed in a coordinated way in a single institution. The use of macroprudential tools can decrease the need for monetary policy to be diverted from managing the business cycle towards managing the credit cycle. This enhances the credibility of the inflation target. That in turn may reduce the need for sharp or persistent moves in interest rates, which themselves might threaten financial stability. Similarly, macroprudential policy can more effectively focus on its primary goal of systemic stability by recognising that, while it affects the economic cycle, it is not suited to managing it. Instead its effects on the economic cycle should – like fiscal policy – be taken into account in setting monetary policy, which is the primary and most effective tool of demand management. Taken together with the synergies from sharing information and analysis, these are strong arguments for operating monetary policy and prudential policy in the same institution. In the short time the Bank has been responsible for both, we have already seen the benefits of operating them in a coordinated way. For example, our forward guidance framework for monetary policy reflects a clear division of responsibilities. Although monetary policy has an important role to play in mitigating financial stability risks, it does so only as a last line of defence. This is important because vulnerabilities can emerge from a long period of unusually low interest rates, as complacency sets in about the future path of policy and asset prices.

The proposed TARGET instant payment settlement (TIPS) service would offer a series of benefits to the payment service providers. First, it would guarantee pan-European reachability for instant payments. Second, it would give payment service providers the possibility to use their credit lines stemming from their collateralised positions in TARGET2. Third, it would eliminate credit risk, thus leading the way to faster and efficient settlement. Last but not least, it would give payment service providers more choice: they could either connect directly to TIPS or channel their payment instructions for instant payments through their respective ACH. The Eurosystem will take a decision by June 2017 on whether to develop the service, based on the results of the public consultation. TIPS could commence operations as soon as 2018. Conclusion Let me conclude. With the migration of the German market to T2S next week, the time has come to reap the actual 2/3  BIS central bankers' speeches  benefits of harmonisation in the post-trade area in Europe. But this does not mean we can slacken in our efforts. There is still a need for further and coordinated action in the harmonisation of post-trade processes. There are also gaps that remain in the financial market integration process when it comes to securities issuance. And there is a need for action in instant payment settlement across Europe. The ECB, together with market stakeholders, has to explore how to best take action in these areas. Thank you for your attention.
In step with the normalisation of monetary policy, net purchases under the pandemic emergency purchase programme (PEPP) were discontinued on 31 March. The maturing principal payments from securities purchased under the PEPP will be reinvested until at least the end of 2024, and in the event of renewed market fragmentation related to the pandemic, PEPP reinvestments can be adjusted flexibly. Further, at our meeting of 14 April, the Governing Council judged that the incoming data reinforced our expectation that net asset purchases under the asset purchase programme (APP) should be concluded in the third quarter of 2022. We also indicated that the raising of key ECB interest rates will take place some time after the end of the net purchases and will be gradual. Lastly, the ECB Governing Council stated that we stand ready to adjust all of our instruments within our mandate, incorporating flexibility if warranted, to ensure that inflation stabilises at its 2% target over the medium term. The pandemic has shown that, under stressed conditions, flexibility in the design and conduct of asset purchases has helped to counter the impaired transmission of monetary policy and made the Governing Council’s efforts to achieve its goal more effective. Within the Governing Council’s mandate, under stressed conditions, flexibility will remain an element of monetary policy whenever threats to monetary policy transmission jeopardise the attainment of price stability. In step with the communication of this process of monetary policy normalisation, market expectations of policy rate hikes have been brought forward since December.

And if developments turn out as we expect, inflation will return to target with little rise in unemployment. We project some rise in unemployment, but from a very low level, and a slightly smaller rise than we anticipated in December. Wage growth is expected to slow from next year, but lower inflation will probably result in firm growth in purchasing power in the years ahead. Let me emphasise that the forecasts are precisely that – forecasts – and not a promise. If the krone proves weaker than projected, or pressures in the economy persist, a higher policy rate than currently projected may be needed to bring inflation down to target. If inflation falls faster or unemployment rises more than projected, the policy rate may be lower than projected. 3/3  BIS - Central bankers' speeches