samchain/econo-pairs-v1 huggingface dataset:
The internationalization of the Chilean peso can enhance financial stability, by alleviating liquidity concerns during stress episodes and reducing counterparty risks, among other effects. All of these changes must be accompanied with more robust and developed financial infrastructures. Also, the wider cross-border usage of the Chilean peso improves our position as a financial center. Regarding concrete measures towards accomplishing these goals, the CBC is reviewing its FX regulation, in order to modernize and simplify it. In addition, a larger and more developed FX market should benefit from having access to more robust financial market infrastructures. Page 12 of 20  Central Bank of Chile September 2019  In order to do so, the CBC issued regulation and is implementing a Trade Repository for OTC derivatives, relying on its current faculties and in coordination with the Financial Market Commission. Additionally, the CBC is working on an initiative that will allow its Real Time Gross Settlement (RTGS) payment system to settle US dollars large-value interbank transactions. These measures add to the future inclusion of the Chilean Peso as the first CLS-eligible currency in South America. This is a priority for the CBC, therefore we are working closely with the CLS Bank to materialize this in the next three years.

The different developments that are underway should contribute to financial stability and increase the crossborder use of the CLP, as well as the participation of non-residents in the domestic market. Therefore, authorities and market participants should be prepared to be part of a bigger and more internationally integrated FX market. Let me conclude by remarking that this journey for the Chilean financial system, through a deep financial crisis, has led to just new bank regulation but also to valuable lessons learnt for the future. A deeper and properly regulated financial system contributes to financial stability, inclusion and increased welfare. Page 19 of 20  Central Bank of Chile September 2019  Preventing stress episodes is a task that requires constant monitoring and early detection of potential sources of vulnerabilities and risk. The enactment of a new Banking General Act and internationalization of the Chilean peso, among other measures, open up a new phase for modern regulation. Even though significant progress has been made in this regard, there are still challenges ahead that must be faced to further strengthen our financial system. ***  Page 20 of 20
Norman T L Chan: Hong Kong as a risk management hub Welcoming remarks and keynote speech by Mr Norman T L Chan, Chief Executive of the Hong Kong Monetary Authority, at the Treasury Markets Summit 2019, Hong Kong, 16 September 2019. * * * Ladies and gentlemen, 1. About 15 years ago, a senior banker suggested to me that, in order to further promote Hong Kong’s position as an international financial centre (IFC), we should turn Hong Kong into a “risk management hub” in Asia. However, he did not elaborate further at the time on exactly what he meant and how this could be achieved. To be honest, it was not clear to me then what this risk management hub idea was all about. 2. Now looking back, I realise that, even without us consciously pursuing the idea as a policy objective, Hong Kong has already made major accomplishment as the “risk management hub” in Asia. Let me explain. Prerequisites for a Risk Management Hub 3. Clearly an important pre-condition for a risk management hub is to have money or capital flowing through Hong Kong. In this context, it is important to distinguish genuine financial flows from those that are not. Many of you may recall that, in the 1990s and prior to the Asian Financial Crisis, many Japanese (regional) banks used Hong Kong to conduct the socalled euro yen businesses, through which the banks would book in Hong Kong their yen loans to borrowers in Japan, presumably to benefit from more favorable tax treatment.

All in all, the financial industry should seek to collaborate with the regulators, more as partners than as adversaries, in developing risk management framework and practices that are most suited for Hong Kong’s circumstances and needs. There is no one-size-fits-all solution for risk management and Hong Kong must find its own path to success by learning from the best practices elsewhere and by striving to upgrade on a continuous basis. Finally, may I wish all of you a fruitful and productive time in today’s Treasury Markets Summit! Thank you. 4/4  BIS central bankers' speeches
The government’s update of the stability programme published this week rightly provides for such a control of public expenditure once the recovery is firmly established (0.7% growth per year from 2023 on average), although this is somewhat higher than 0.5% per year, and incorporates a more  optimistic view on potential growth than our own forecast (1.35% vs. 1.1%). What is more important in this regard however is not the exact number but that the established targets are effectively met. The level to be fixed – and then respected –, is a matter for democratic debate, not for central banks. This is a demanding but attainable goal: many of our European neighbours have achieved it. ** In conclusion, the Covid crisis has completely warranted a very supportive fiscal policy. But the gradual exit from this crisis should be a crucial opportunity for us Europeans to respond to one core question: how to maintain the right use of the fiscal tool while ensuring the sustainability of our debt, in order to be able to finance our common social model for coming generations. Accommodative monetary policy obviously helps, but it cannot be taken for granted eternally. To draw an analogy from the sphere of climate change, we should avoid a « tragedy on the horizon ». Thomas Paine, an English-born political philosopher and citizen of the world, once said: “If there must be trouble, let it be in my day that my child may have peace.iii” This is exactly what we should aim at in the next decade.

The interest rate influences inflation indirectly via domestic demand for goods and services and via its effect on the exchange rate. When interest rates rise, it becomes more profitable for households to save, and consumption will therefore be postponed. Similarly, borrowing becomes more expensive, and investment will decline as a result. Lower demand then curbs the rise in prices and wages. Higher interest rates make it more attractive to invest in NOK and borrow in foreign currency. Therefore, higher interest rates normally lead to an appreciation of the krone. This makes imported goods cheaper. In addition, a stronger krone reduces activity, profitability and the ability to pay in the internationally exposed sector. Major economies such as the US, Germany and France are struggling with stagnation and fears of recession. Sluggish developments have led many countries to set very low interest rates in an attempt to stimulate growth. The business cycles in Norway and other countries have been desynchronised. While the turnaround abroad took place two years ago, the Norwegian economy continued to show a high level of activity. Towards the end of the upturn, the economy was facing labour shortages, higher wage growth and a sharp increase in household consumption and debt. Interest rates had to be kept at a high level in  BIS Review 23/2003  1  Norway. This led to a widening of the interest rate differential against other countries. The main explanation for the wide interest rate differential is that interest rates abroad are at a historically low level.
Foreigners were allowed to invest in Sweden without a permit, but these investments might not be financed in the Swedish market. Portfolio investment abroad was regarded as more transient than direct investment and it was therefore more difficult for a Swedish company to obtain permission for this in another country. Companies that earned money abroad were obliged to bring it home to Sweden as soon as possible and convert it to Swedish krona. Swedish banks required permits to establish subsidiaries abroad and were on the whole not allowed to open branches abroad. This was because it was easier to control capital movements between parent and subsidiary than between branches, as the latter were not different legal entities. Prior to 1986, foreign banks were not allowed to establish in Sweden. After this, subsidiaries were permitted and later on also branches. Swedes were in general not permitted to purchase shares in companies outside of Sweden. Those who were already in possession of foreign shares were allowed to exchange them for others or to sell their right to own shares to someone else if they sold their holdings. Private persons were not allowed to take unlimited currency out of the country. Amounts above the regulated limit – which was low – required permission from the Riksbank. It was necessary to show evidence that the money would be used for personal aims and not for investment or other financial purposes. Private persons were not allowed to hold accounts abroad.

Incentives for increased saving were not actually introduced until the crisis was actually upon us and then they only helped reinforce the decline. It may seem something of a paradox that international organisations, such as the Basel Committee, are now implementing a number of new regulations – such as Basel II – despite the fact that the old regulations had negative effects and were therefore abolished. However, these are a completely different type of regulation. The old regulations were aimed at prohibition and other strict controls, while modern regulations give the banks plenty of flexibility to offer their services as long as they meet certain fundamental conditions. For instance, Basel II allows the banks to determine their own risktaking to a great extent, as long as they have adequate risk management and capital reserves. The experiences of regulation and the crisis also show clearly how important it is that the central bank can make independent decisions regarding the interest rate according to objectives set by parliament, for instance, to maintain inflation or the exchange rate at a stable level. If there are no guidelines for the interest rate, or if the parties that determine the interest rate have differing interests, it will often be set too low for the purpose of benefiting borrowers, investment and central government consumption. This was the case in Sweden during the years of regulation. Apart from leading to higher inflation and pressure on the exchange rate, exaggeratedly low interest rates also have a negative effect on the financial sector.
Adnan Zaylani Mohamad Zahid: Leadership, values, ethics and Islamic finance - the next generation of Islamic financial institutions Keynote address by Mr Adnan Zaylani Mohamad Zahid, Assistant Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the IFN Asia Forum 2019, Kuala Lumpur, 23 April 2019. * * * Allow me to first begin by thanking the organiser for inviting me to deliver the keynote address at this annual IFN Asia Forum. It is a pleasure to be here this morning in the company of such a diverse gathering of Islamic finance professionals and weigh in on an important subject of which the organiser had kindly assigned me; “Leadership, Values, Ethics and Islamic Finance: The Next Generation of Islamic Financial Institutions". For many of us, the 2008 global financial crisis will be one of the major events that stays with us throughout our careers. In Asia, we had the Asian Financial Crisis in 1998 which was momentous but given the scale and its far reaching impact, the 2008 crisis has left far larger imprints. More than a decade has passed, yet we continue to live under its shadows. A world that has grown at a slower pace, in a low inflation, bordering on deflationary risk environment for the better part of a decade. Banking and financial regulations that undoubtedly have strengthened the resilience of the system, but could have had unintended consequences on growth.

The banks’ progress and effectiveness of VBI-related initiatives would be captured through the VBI Scorecard. The underpinning thrusts of VBI are also gaining relevance in the takaful industry as takaful operators are taking initial steps in exploring value-based protection for their customers. Given the universal nature of VBI, I believe that its adoption by financial groups which comprise the conventional financial institutions, as well as issuers and investors would be a natural evolution in the financial ecosystem. Expectations on the next generation of Islamic financial institutions The next generation of Islamic financial institutions would thus be driven by values and not just profit. With a moral outlook for the ultimate good, strengthened by self-discipline, greater accountability and integrity, Islamic financial institutions will have stronger consideration of the impact of decisions made. There should be greater drive to continuously improve their offerings and treatments towards customers and employees, which include fair and transparent disclosure in order to increase the positive impact of their activities. Development of banking practices based on VBI concepts are also anticipated to encourage the creation of new business opportunities and provide the foundation for better returns for Islamic banks over the long term. An example is assessment of financing application by Islamic banks based on value-creation instead of mere credit scoring which would benefit business propositions from new sectors such as SMEs. Another example is refocusing, strengthening and repositioning of personal financing 3/4  BIS central bankers' speeches  by Islamic banks to best meet the needs and circumstances of customers.
In the euro area economies, the high unemployment levels and the need to reduce significant debt ratios curbed the expansion of demand, while the fragility of banking systems hampered the transmission of monetary policy measures to the real economy. These factors obliged the ECB to take a different tack and turn to so-called nonconventional measures. Firstly, the interest rates on ordinary monetary policy operations were successively cut, placing the deposit facility rate at a negative level of -0.4%, which currently remains in place. Secondly, the ECB introduced a new long-term financing facility for the banking system, which was linked to the granting of loans to households and firms. Thirdly, in 2015, the ECB took the historic step of launching a quantitative easing programme by means of the large-scale purchase of public and private assets. Currently, purchases are being made at a monthly pace of € billion, and this is expected to continue at least until next December, whereby at the end of the current year the scale of asset purchases will be drawing close to 22% of euro area GDP. Lastly, communication has become a most important instrument for influencing agents’ expectations and heightening the effectiveness of measures. Specifically, the ECB has incorporated forward guidance on interest rates and the purchase programme into its communication.

The Bank set out some ideas on the design of such an open platform for SMEs last year.9  Data collection is also integral to the work that the Bank itself does in pursuit of its wider mission. Without the data we collect, we cannot identify risks, design good policy, and take action in a timely and targeted fashion. That’s why delivering ‘common data standards’, rules and methods that consistently label and describe financial data, are a priority long term reform for us. Reflecting that priority the Bank are setting up a joint transformation programme with the Financial Conduct Authority (FCA) and industry. And Sam Woods, the Deputy Governor for Prudential Regulation, and Nikhil Rathi, CEO of the FCA, recently published a letter to firms providing an update on this work, and asking firms to work with us in partnership to deliver common data standards and other crucial reforms. 10  AI and AIPPF  Yet another rapidly-developing area is the adoption of AI in finance. We know that finance is one of the sectors that has seen widespread adoption of AI in recent years.11 COVID-19 has accelerated this trend. Half of the banks we surveyed reported an increase in the importance of AI as a result of the pandemic. 12 The adoption of AI is already bearing fruit in a number of areas within the financial sector with a very wide range of use cases.
As you will hear in a moment, we have already learned a lot. I’d encourage you all – those in the room and viewers elsewhere – to submit your questions and contributions via Twitter (#FutureForumBoE). Finally, let me thank Ranvir Singh, our moderator for today’s Future Forum, for keeping us on track today – and with that I’ll hand back to her. 5  All speeches are available online at www.bankofengland.co.uk/speeches  5

3  According to the Food Outlook from the Food and Agricultural Organization of the United Nations (FAO), 22 May 2008. BIS Review 68/2008  3  When we decide on the future direction of monetary policy, it is important to know whether the rising oil and food prices will have lasting or temporary effects on inflation. 4 It is difficult to know this in advance. We must follow developments closely. But we can receive some guidance by looking at the factors that lie behind the price increases. Increased demand, supply effects and portfolio investment behind rising commodity prices One reason for the high commodity prices is the increased demand in the world market from emerging economies. Higher incomes per capita in China, India and other rapidly growing economies have led to increased demand for food and also to changes in the patterns of food consumption. Demand for meat has increased in particular, which has in turn pushed up the demand for and prices of feed grain. This also spreads to other food crops. It is reasonable to believe that the demand for food in the world will remain high. Another important driving force behind the world demand for commodities is the investment in ethanol and biodiesel in recent years. The increased use of some food commodities in the production of biofuels limits the supply of food and increases the price of food crops.
The macroeconomic projections accompanying the Budget for 2013 include the stabilising of our unemployment rate at around 25% of the labour force, a rate double the average for the European Union countries. This rate of unemployment is, quite simply, dramatic. Hence the enormous importance of economic recovery and of greater labour market flexibility: these two variables complement one another, and without both operating simultaneously, net job creation will not be possible. Fiscal consolidation I shall now move on to public finances and to the nature of the fiscal drive needed. In 2007 Spain posted a budget surplus of close to 2% of GDP and a public debt/GDP ratio of 37%, then one of the lowest among the euro area members. However, this apparently healthy state of affairs concealed a precarious situation owing to the presence of high tax revenue that had a significant temporary component tied to the major expansion of the construction and real estate sector, and to unsustainable spending dynamics. Indeed, the end of this expansion uncovered the risks latent in that situation. Almost half of the deterioration of more than 13 pp of GDP over only two years from 2007 to 2009 – a turnaround in public finances unprecedented in Spanish economic history – was due to the fall in revenue, largely associated with the disappearance of the aforementioned extraordinary revenue.

Philipp M Hildebrand: Developing countries and international capital markets Summary of a speech by Mr Philipp M Hildebrand, Member of the Governing Board of the Swiss National Bank, to economiesuisse, Zurich, 14 June 2005. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch). *  *  *  After having plummeted on the back of the Asian crisis, capital flows to developing countries have risen considerably again in the last three years. In 2005, they are likely to reach the approximate level at which they stood shortly before the Asian crisis. Capital flows are channelled mostly to a few emerging markets, notably China. China’s monetary order is currently undergoing profound changes, with the country gradually liberalising capital movements. The concept of the “impossible trinity”, which was developed by the Nobel Prize winner Robert Mundell, asserts that this will inevitably lead either to a loss in monetary autonomy or to a flexibilisation of the exchange rate regime. Both trends can be clearly observed: the pressure on the fixed exchange rate on the one hand, and the rapid expansion of the monetary and credit aggregates on the other. In the longer term, China’s monetary order will probably move towards floating exchange rates. This transition will hopefully be successful. As China’s monetary policy of gradual change has so far proved its worth, it is likely to serve as an example to other developing countries.
Essays in persuasion: 358–73. London Metropolitan University (2015), “Proposed congress of trade councils”, available at: http://www.unionhistory.info/britainatwork/emuweb/objects/nofdigi/tuc/imagedisplay.php?irn= 2000001&reftable=ecatalogue&refirn=2000000. Maddison, A (2011) “The World Economy: A Millennial Perspective”, available for download at: http://www.oecd.org/dev/developmentcentrestudiestheworldeconomyamillennialperspective.h tm. Manyika, J, Chui, M, Bughin, J, Dobbs, R, Bisson, P, and Marrs, A (2013), “Disruptive technologies: Advances that will transform life, business, and the global economy” McKinsey Global Institute, Vol180, San Francisco, CA, USA. Marx, K (1867) “Capital: Volume 1”, available at: http://www.econlib.org/library/YPDBooks/Marx/mrxCpA1.html. McAfee, A (2015) “A life without work can be fatal” Financial Times, available at: http://www.ft.com/cms/s/0/1b99abe2-8249–11e5-8095-ed1a37d1e096.html#axzz3rAvk1er8. BIS central bankers’ speeches  15  Mill, J S (1848), “Principles of political economy with some of their applications to social philosophy”, JW Parker. Mokyr, J, Vickers, C, and Ziebarth, N L (2015) “The history of technological anxiety and the future of economic growth: Is this time different?” The Journal of Economic Perspectives, Vol29(3): pages 31–50. NEF (2015), “Five headline indicators of national success”, available at: http://www.neweconomics.org/publications/entry/five-headline-indicators-of-national-success. OECD (2012) “Labour losing to capital: what explains the declining labour share?”, OECD Employment Outlook 2012, available here: http://www.oecd.org/els/emp/EMO%202012%20Eng_Chapter%203.pdf. Pessoa, J P, and Van Reenen, J (2013) “Decoupling of wage growth and productivity growth? Myth and reality” Centre for Economic Performance, DEP Discussion Paper No 1246. Piketty, T (2014) “Capital in the 21st Century.” Cambridge: Harvard Uni. Pratt, G A (2015) “Is a Cambrian Explosion Coming for Robotics?” Journal of Economic Perspectives, Vol29(3): pages 51–60. Salvatori, A (2015), “The anatomy of job polarisation in the UK”, IZA DP 9193.

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