samchain/econo-pairs-v1 huggingface dataset:
Since 2014, as a central bank, we have an access to the individual balance sheets of all the corporate entities in the economy. The granularity of the data allows for a closer look at the behavior of the firms in different sectors, their performances, their leverage, structure of their sources of financing, the potential vulnerabilities which might cumulate in different sectors, with different implications for the economy in general. All of this is valuable information, not affordable by using the aggregates only. I would still like to emphasize that for small economies, as the Macedonian, the usage of micro data on a regular basis for monetary policy purposes is not an unknown practice. Given that, we are small and open economy, with a strategy of de facto fixed exchange rate, where in depth scrutinization of the external sector data has been a practice with a long tradition. The incoming data on external sector is analyzed on aggregate and sectoral level, but also some of the micro data on individual companies is being monitored on a monthly basis. This pertains mainly to some of the traditional sectors with relatively large weight in the total export, like the metal industry. Given its importance, and at the same time its large exposure to external shocks, regular monitoring of the individual data provides first signals for potential vulnerabilities.

In 2014, bilateral agreements with all regulatory bodies for OFIs have been amended encompassing securities statistics, arranging data sharing and streamlining the data collection for the needs of the National Bank through the regulators, enabling parallel access to the data, as well as increased quality controls in the process of data collection, and above all overcoming confidentiality issues. The other side of the coin is that enhanced data sets pose some challenges. More frequent granular data increases the reporting burden of the industry, but also the burden of the statisticians. This further underlines the need for “merit and cost” procedure and reinvestigating the potential of data sharing among domestic or international institutions, which brings us to the issue of comparability and possibility of using the similar data sets for different purposes. Better cooperation among regulatory agencies may help in this regard. The switch from “aggregate statistics” to granular multi-purpose statics requires adequate statistical resources including IT infrastructure and tools to process and present data in a meaningful form for the policymakers, as they should be able to see the wood and not be lost among the trees. The extensive production and usage of individual, micro data raises an important question on the data security and data confidentiality issues. So far, we have seen that it can be an important constraint both for statistics, but also for the analytical work. Knowing that the data are available in the system, but restricted for use, is very often a reality in our day-to-day work.
Ravi Menon: The Goldilocks economy - will the three bears return?" Speech by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the UBS Wealth Insights Conference, Singapore, 15 January 2018. * * * Mr Edmund Koh, UBS Head of Wealth Management Asia-Pacific, Ladies and gentlemen, good morning. Let me first wish everyone a happy 2018. And also thank UBS for the invitation to speak at this conference. Global growth about as good as it gets 2017 has been a good year for the global economy. World GDP is estimated to have grown by 3.8%, significantly higher than the 3.2% registered in 2016. This is the strongest pace of expansion since the rebound from the global financial crisis in 2010. All indications are that 2018 will be another good year. Most of the world’s major economies are expected to continue strengthening over the course of this year. The IMF expects growth in 2018 to be even better than 2017. There are good reasons for optimism. The most encouraging is investment. Investment expenditure, which had been largely missing from the GDP growth numbers since the global financial crisis, is coming back. Global fixed investments have rebounded by almost 6% in 2017, after contracting in the previous two years. Trade is another piece of good news. Growth in global trade has almost doubled to 4% in 2017, outpacing world GDP growth. This has arrested a worrying trend since 2011, with global trade growing slower than global GDP.

“Papa Bear” - Inflation Let me start with “papa bear” inflation. On conventional wisdom, he should be making an appearance by now. Historically, inflation comes from high wage growth in a tight labour market during the late stages of the business cycle – a relationship economists describe as the Phillips Curve. Cyclical conditions are now tight in major economies, especially in the US. US unemployment rate has fallen to 4.1%, well below the Fed’s estimated Non2/7  BIS central bankers' speeches  Accelerating Inflation Rate of Unemployment (NAIRU) of 4.6%. Yet, wage growth has remained at around 2.5%, below the pre-crisis average of 3.5%. Whenever central bankers gather these days, this phenomenon of “missing inflation” is often the main topic of discussion. Many wonder whether the Philips Curve has permanently flattened – meaning whether the negative relationship between the unemployment rate and wage growth has fundamentally weakened. Some even ask if the Philips Curve is dead – if the relationship no longer exists. Why has “papa bear” inflation been missing to-date? The first and simplest explanation is that the headline measure of unemployment may be understating the level of slack in the economy. In the US, the IMF estimates that the output gap between actual and potential GDP has only just closed. The output gaps in the EU and Japan are still some way off from closing. There may also be quite some slack in the labour market that may not be fully apparent.
The only option that does not involve using another bank account is to buy bitcoins. Ola does not want to do this. Perhaps he is a little stubborn. He wants cash. The bank clerk is patient. He tells Ola that the bank can offer dollar or euro banknotes. Ola sees no alternative and withdraws euro banknotes. But he soon encounters another problem. In order 6/9  BIS central bankers' speeches  to use this currency to make purchases in Norway, the shop has to accept payment in euros. If not, Ola will have to deposit the euro banknotes in his bank account in order to make the payment – bringing him back to square one. What has been lost here? First, Ola has become completely dependent on a third party – the bank: payments can no longer be made directly between two parties, but must be channelled through a bank, a card company or an app. Today, you can settle a payment at a shop or with a neighbour in cash, without involving anyone else. Second, Ola has become dependent on the technology functioning as it should. Technology is not needed to settle payments in cash – as long as cash is available. Third, Ola is no longer anonymous when he makes a payment. All payment transactions using deposit money can be recorded. Anonymous payments are often associated with something negative, such as tax evasion or other criminal activity. But there is another side to anonymity – privacy.

For consumers, they could mean more choice; better-targeted services; and keener pricing. For everyone, FinTech may deliver a more inclusive financial system, domestically and globally; with people better connected, more informed and increasingly empowered. 2  1  Especially the balance between inside money (created by commercial banks) and outside money (created by central banks). 2  FinTech could play a role in helping to address a worrying decline in the provision of correspondent banking services which support cross-border payment and settlement. Half of emerging market and developing economy jurisdictions, three quarters of large banks and a majority of local and regional respondent banks recently reported a decline in such services. Know-your-customer utilities and potentially distributed ledger technologies  2  BIS central bankers’ speeches  These benefits spring from FinTech’s potential to deliver a great unbundling of banking into its core functions of settling payments, performing maturity transformation, sharing risk and allocating capital. This would mean revolution, fundamentally re-shaping the financial system. At the same time, some financial technologies could make incumbent banks more efficient and profitable, reinforcing existing economies of scale and scope in banking. This would mean a restoration, reinforcing incumbents’ power. The balance of these forces may yield a third alternative – a reformation – a more diverse, resilient and effective system for consumers. One where large banks exist alongside new entrants who compete across the value chain.
Chart 3: Network of cross-references in the regulatory framework (provisions for UK deposit-takers, 2007 and 2017)  2007  2017  Note: Each node represents a provision, and each edge (line between nodes) represents cross-references between provisions. For 2017, we also show the legal source for each provision: CRR (yellow nodes), Rulebook (blue), EBA Technical Standards (red) and Supervisory Statements (green). The source for the 2007 network is the FSA Handbook (only prudential provisions for deposit-takers). For visual clarity, only nodes with at least one edge are displayed, and edges on the plot are unweighted, i.e. they do not show the number of cross-references. One way to put numbers on this is Google’s PageRank algorithm, originally designed to measure the centrality and importance of individual web pages. Chart 4 compares PageRank scores for the provisions in the 2007 and 2017 banking frameworks: you can see that connectedness increases most for the most central individual provisions. The full consequences of using and changing a handful of core rules are inherently broader in this new regulatory architecture. 8  All speeches are available online at www.bankofengland.co.uk/news/speeches  8  Chart 4: PageRank network centrality measure (provisions for UK deposit takers, 2007 and 2017)  Note: PageRank summarises the centrality of a node within a network. In this case, it counts the number and quality of cross-references to a provision to estimate how important the provision is. More important, i.e. more central, provisions are likely to get more direct and indirect links from other provisions.

Under this process, the system of burden-sharing among the national and mutualised funds will be gradually adjusted until the national compartments disappear completely around January 2025. The complex agreement reached has yet to be accepted by the European Parliament, so there is still uncertainty as to the final design of the mechanism. Moreover, the capabilities of the mechanism will foreseeably be limited at first, since the single resolution fund is constrained by its modest size and reduced mutualisation. Furthermore, for the time being, the agreement does not include common public mechanisms for the resolution of vulnerable banks after the available private funds have all been used up. 4  BIS central bankers’ speeches  In this respect, although the new resolution rules reduce the foreseeable scope of the required external funds, provision should be made for public financial support at EU level to ensure the orderly resolution of systemic banks if necessary. For example, following the example of the US, we could consider an arrangement in which the European Stability Mechanism could provide the resources needed to the common resolution fund with a charge to future contributions from the industry. Otherwise, the single resolution mechanism would, at least in the short-to-medium term, foreseeably be insufficient to prevent banking crises from continuing to be resolved with a charge to national funds, whether public or private. That said, the agreement reached should by no means be underrated.
This pan-European solution would be a major step forward that would help European banks withstand the challenges posed by the BigTechs. There is also another important area where we need to make headway: reducing the cost and speeding up the execution of cross-border payments by identifying concrete and useful solutions. Our aim should notably be to harmonise the technical standards used for transfers of funds, and to enhance the interoperability of payment systems and solutions. Between now and the autumn, the FSB, under the aegis of the G20, will propose concrete measures to make cross-border, extra-European payments significantly cheaper and faster. I shall turn now to a topic that is a major challenge for the future of the international monetary and financial system: the possible creation of a central bank digital currency (CBDC). The creation of a new form of currency by central banks goes beyond the challenges I have just mentioned: it is neither a precondition for nor a guarantee of more efficient payments. However, we as central banks must and want to take up this call for innovation at a time when private initiatives – especially payments between financial players – and technologies are accelerating, and public and political demand is increasing. Other countries have paved the way; it is now up to us to play our part, both ambitiously and methodically. To this end, the Banque de France is to be reorganised.

But the Czech Republic has a higher GDP per capita than Portugal (or Greece, for that matter, and many other countries in the euro area) and is getting closer and closer to Spain, a solidly developed country according to all measures. The Czech Republic also has a human development index comparable to that of Austria and Italy. In fact, living standards in the Czech Republic have been higher than those in Portugal for at least a quarter of a millennium, since the start of the industrial revolution (with the possible exception of a couple of decades centred on 1990). But once a country enters the euro area, it is almost automatically treated as a developed country, even in the eyes of the markets. Personally, I find that rather confusing. In practice, therefore, we observe that some nominally “emerging” countries (such as Poland, Israel and Singapore) have been dealing with exactly the same issues as the nominally developed ones. At the same time, some nominally developed countries (such as Greece) are dealing with problems typical of developing countries, issues including incomplete land registries and an insufficient basic ability to collect taxes. This confusion in taxonomy complicates our discussion a great deal, especially in the years of the crisis and its aftermath. The question at the beginning of the crisis was: who in Europe will prove to be most vulnerable to shocks? Many believed it would be Central and Eastern European countries.
9-56, Federal Reserve Bank of Kansas City. Summers, P. (2005), “What Caused The Great Moderation? Some Cross-Copuntry Evidence,” Economic Review, Federal Reserve Bank of Kansas City, Third Quarter, pp. 5-32. Truman, E. (2003), “Inflation Targeting in the World Economy,” Institute for International Economics. Vega, M. and D. Winkelried (2005), “Inflation Targeting and Inflation Behavior: A Successful Story?” International Journal of Central Banking 1(3) pp. 153-75. BIS Review 74/2008  7  Figure 1: Growth and inflation in developing economies 25  6  Inflation  4 15 3 10 2 5  Output Growth  5  20  1  0  0 1974  1982  1990 Inflation  1998  2006  Growth  Note: Inflation was calculated using YoY \% change in consumer prices, given by IFS line 64. Growth was calculated as the YoY \% change in GDP volume as given by IFS line 99b. Averages are taken over all countries that have data available from 1975. Industrial and developing status of countries has been taken directly from IFS. Source: IFS. Figure 2: Inflation and output growth volatility in developing economies  10  8  8  6  6  4  4  2 1974  1982  1990  1998  2 2006  Growth Volatility (s.d.) Inflation Volatility (s.d.)

•  A second related explanation is focused on structural and technological changes which are permanent in nature, but were not directly caused or controlled by macroeconomic policies. For example, a special type of technological progress frequently mentioned in the discussion of output volatility refers to the improved management of inventories. If a significant part of the business cycle dynamics occurs through inventory fluctuations, “just in time” technologies and better management of inventories in general would reduce volatility along the business cycle (McConnell and Perez-Quiroz, 2000; Cecchetti et al., 2005). Another important structural change is related to worldwide economic integration and globalization, as reviewed in the Geneva Report prepared for this conference (Gerlach et al., 2008). Cavallo (2007), for example, emphasizes that trade openness has reduced output volatility, and hence, more open economies are also more stable. This evidence refutes the old view that more open economies are more exposed to volatility. On the contrary, Cavallo (2007) argues that more open economies have more opportunities to adjust to international shocks. Following this argument, the notable increase in openness all around the world would make all countries more stable. 1  •  A third and final factor which I would like to emphasize is related to improved monetary policy. These reforms have resulted in the reduction of not only inflation levels, but also its volatility. Figure 1 shows average growth and inflation over an ample set of developing countries, 2 while figure 2 shows the volatility of output and inflation.
The common interest is to keep the Basle standards at a level sufficient to ensure financial soundness, a minimum above which banks will choose to operate. To achieve this, we must fashion a set of standards that does not greatly distort incentives. Supervisors acknowledge that the current regulations and ratios need to be updated to be more meaningful, given the full range of risks banks face today. Supervisors are always challenged to keep pace with financial innovation and improvements in risk management practices, and this suggests that we will need a frequent monitoring and maintenance program for the present and future Accord. In closing, I would like to summarize the key supervisory objectives that we are mindful of as we look to revise the Accord and enhance the overall capital framework. Our first objective, of course, is to promote the safety and soundness of the financial system. Our second is to enhance competitive equality, while allowing for differences among banks based on  5  BIS Review 32/1999  differences in their risk profiles. These were the original goals of the Accord. Our third is to develop standards that are fundamentally applicable to banks of varying levels of complexity and sophistication, including those in emerging market nations. In developing this capital framework over the next year, we plan to consult closely with the financial and supervisory community and communicate openly about our progress. By yearend, we hope to have made great strides in furthering our objectives.

Inevitably, this aspect takes on greater importance. For one reason, supervisors expect banks to operate above minimum regulatory capital ratios included in the Basle Accord – and prudent assessments can help to inform by how much. For another, supervisors seek to intervene early enough to prevent capital from falling below prudent levels – and bank assessments can provide another useful tool in identifying key issues before they become major problems. With these thoughts in mind, supervisors are tackling the challenge of developing a more systematic approach to the review of capital adequacy. Supervisors also are discussing ways to enhance market-based discipline. Most agree there should be a greater role for private-sector monitoring of banks. Of course, there already exists a fair amount of market-based monitoring; however, the collection and use of these kinds of information usually are not systematic or complete. The first goal is to improve information available to the market. With enhanced risk disclosure, supervisors will be more able to rely on the opinion of market investors. These opinions are reflected quickly in the price of bank debt and share prices, and the ease with which banks can access capital. By relying more on these market signals, supervisors will be better able to identify and address waning capital levels at problem institutions. To the extent banks develop disciplined internal approaches to evaluating capital adequacy and capital plans, and enhance disclosures, supervisors will be able to place greater reliance on all three pillars and meet the challenges of a more complex financial marketplace.
On top of that, in our considerations, the Bank Board must discuss the evolution of longer client interest rates and take into account how the interest rate transmission mechanism works and how changes in short-term rates will affect long-term rates. That is why our decisions take into account not only the opinion of the Monetary Department, but also that of the Financial Stability Department. We attribute a greater role to credit in the economy and debt, which our model previously left out. Deputy Governor Eva Zamrazilová will also talk about this after me. Deputy Governor Jan Frait also discussed this topic in his lecture at the university in Ostrava in 2023. Credit market developments very well combine our two main objectives – price and financial stability. The current data from money flow monitoring are as follows: The volume of new mortgages dropped by 70% year on year in 2023 Q1. To give an idea, CZK 149 billion in new mortgage loans was provided in 2022 as a whole, compared with CZK 368 billion a year earlier. The decrease in loans totalled CZK 219 billion. New koruna loans to firms fell by 56% year on year in Q1. However, firms are fleeing to the euro – 43% of new loans to firms are currently in euros. Nevertheless, this channel is also gradually cooling as the ECB raises its rates. In Q1, the volume of new euro loans to firms fell by 6% year on year.

The decline in production and investments will be confining the opportunities for an upturn in income. Consumer demand will be shrinking. The measures implemented by the Government and the Bank of Russia will support the economy, and specifically the most affected industries. Economic growth in 2021–2022 will largely be recovery-type. According to our forecast, GDP will expand by 3–5% in 2021 and by 1.5–3.5% in 2022. GDP growth will be promoted by a further implementation of national projects. However, our baseline forecast factors in only the already effective budget support measures. An upturn in the economy and domestic demand will also be driven by the easing of monetary conditions resulting from the monetary policy pursued. This will support lending, and its growth rate will rise from 3–8% this year to 6–11% in 2021–2022. The lending potential will also be maintained owing to the regulatory easing and the expansion of the Bank of Russia’s specialised refinancing instruments. According to our estimates, the easing of monetary policy is needed to maintain annual inflation close to 4% over the forecast horizon. The slump in domestic and external demand this year will be considerably containing inflation, which induces the risk of its substantial deviation downwards from the target in 2021 and over a medium-term horizon if no additional monetary policy measures are introduced. The disinflationary pressure of weak demand will offset the effect of temporary proinflationary factors, that is, the ruble weakening and the observed elevated demand for individual products, already this year.