samchain/econo-pairs-v1 huggingface dataset:
In this respect, you will have seen in a recently published Opinion of the ECB on, inter alia, amendments to the EU Capital Requirements Regulation (CRR), that the ECB supports the review of the calculation method for the leverage ratio.16 I have also previously voiced support as CPMI Chair for implementing the leverage ratio in a way that does not create disincentives for centrally cleared transactions, namely by offsetting the initial margin in the case of derivative exposures related to client clearing.17 All these exercises, however, should not be mistaken for tolerance of a relaxation of regulation. Post-crisis reforms aim to curb excessive leverage and reliance on short-term wholesale funding, and for good reasons. This is also why the Financial Stability Board (FSB) has published specific recommendations, including a framework for minimum haircuts for securities financing transactions (SFTs).18 The FSB has also assessed the potential financial stability risks related to collateral re-use in SFTs.19 The latter may contribute to a build-up of leverage and increase interconnectedness among market participants. The FSB concluded that regulatory reforms, in particular the leverage ratio and the liquidity requirements, are important to mitigate these risks. 8 / 10  BIS central bankers' speeches  This means that the implementation of the Basel III reforms will have effects on repo markets, as intended. These might look undesirable from an institution-perspective but they will have systemwide benefits. Conclusion Let me conclude. The repo market is undergoing significant change.

Finally, under the Title II resolution regime, the businesses and the franchise value of the subsidiary-level customer relationships will be maintained relative to a traditional bankruptcy proceeding, which in the past has often led to the liquidation of the bankrupt entity. As we saw in the case of Lehman Brothers, for financial firms, bankruptcy can destroy considerable value. This isn’t an argument against Title II resolution. Dodd-Frank’s addition of Title II to the resolution toolkit was an important advance to regulators’ ability to mitigate financial instability. But we must recognize that Title II by itself it is not sufficient to eliminate the advantages of being perceived as too big to undergo ordinary bankruptcy at the holding company level. Moreover, even with a viable Title II resolution regime in place, we must recognize that there still will be disruption to the financial system when a large firm fails. This suggests to me that while a Title II single point of entry resolution is a very useful tool that we should continue to develop, we should view it as more preferable to prevent the failure of the SIFI in the first place. In this regard, I think we have made considerable progress by raising capital and liquidity requirements for large, complex firms.
It may be that some of the difference in the rise in clothing prices in the two countries is due to the way prices are measured and interpreted rather than to actual price developments. This is also supported by Eurostat’s price level survey. Eurostat compares different countries’ prices for identical goods and finds that the level of clothing prices in Norway has in fact risen somewhat compared with clothing prices in Sweden in recent years. According to the CPI in the two countries, clothing prices in Norway have fallen by 30 per cent relative to clothing prices in Sweden in the period 1999-2005. The goods measured in Eurostat’s survey are probably not representative of the basket of consumer goods in Norway. The survey nonetheless illustrates the uncertainty surrounding actual developments in clothing prices. Allow me to conclude. Inflation in a country with its own national currency is not something that just drifts in with the wind from abroad. It is monetary policy that over time determines the nominal path. In the short and medium term, we can weigh the variability in inflation against the variability in output and employment. Nevertheless, the overriding objective is to anchor expectations of low and stable inflation. We must never lose sight of this. There is considerable uncertainty surrounding the economic situation and economic developments ahead. Statistical forecasting techniques and macroeconomic models can help us gain further insights into and a better understanding of the driving forces, but can obviously not eliminate risk and uncertainty.

Getting back to the credit expansion in the household sector, the development we see in Sweden today is not unique. The American economy has been the subject of much recent discussion. A growing number of voices have warned that the risks have been built up into something of a financial bubble. The apprehensions derive from highly inflated asset values, low saving and increased indebtedness, i.e. in principle, a similar situation to the one we currently have in Sweden. Total lending by American banks increased in March by 10.1% compared with March 1999 and lending in relation to GDP is currently at a historically high level. The lending statistics show that the primary increase is in lending 2  For example, a 5-year government bond. 3  BIS Review 50/2000  for housing, due to rising property prices. At the same time as lending is increasing, saving is declining. Over the last five years, saving as a proportion of disposable income has fallen by nearly 5 percentage points and amounted to a low 2% during the last quarter of 1999. Sweden has shown a similar development. During the last five years, the saving ratio has fallen by over 9 percentage points and is currently at 2%. There are thus several signs of a development that is worrying from the view of financial stability. The rising debt ratio has without a doubt made households more vulnerable. However, as in Sweden, employment and households’ financial assets have increased, which favours the households’ ability to pay.
Yet even after successful structural reforms, in a monetary union with 19 Member States there can always be economic shocks which affect some countries more than others. Flexible labour markets and a responsible fiscal policy help to cushion such shocks – not only in a monetary union. In such a union however they play an even greater role, because the countries concerned can no longer react by way of the exchange rate or national monetary policy. But if the shock is excessive or the economic structures too rigid and the national budget under pressure, the Member State in question may be quickly overwhelmed. This is exactly what we have seen during the recent crisis. The costs of the crisis were borne in large part by the citizens in the crisis countries, but also shifted in part to the European level through mutual guarantees. Basically, the countries concerned resorted to a sort of implicit insurance that was not originally foreseen. This experience gives rise to two key questions: •  First, how can Member States better absorb external shocks – even without an independent exchange rate and without a national monetary policy? •  Second, how can risks be shared at European level without a transfer of risk occurring which distorts the incentives for the individual Member States? A monetary union needs strong members... As for the first question, the euro area countries need economic structures which meet the requirements of a single currency. The crisis has made this abundantly clear.

More than 60 years ago, Jean Monnet, one  1  Standard Eurobarometer 84, November 2015. BIS central bankers’ speeches  1  of the founding fathers of the European Union, said: “Our countries have become too small for today’s world, at the level of modern techniques, at the measure of America and Russia today, China and India tomorrow”. The idea is therefore ingenious and the will of the people is clear. Together, this represents an appeal to policymakers to straighten out what is crooked, to reinforce the foundations of monetary union and once again reconcile the reality of the euro with the idea of the euro. The consequences of the recent financial and economic crisis show what is needed to achieve this from an economic perspective. What we certainly need is a European crisis tool – a mechanism that works quickly, effectively and efficiently in an acute crisis. A first step was taken with the creation of the European Stability Mechanism. But what’s necessary above all are structural reforms at national level, including reforms of social security schemes, labour and goods markets and insolvency laws. Reforms which ensure that the community of 19 countries grow together economically and move closer to the highest international standards. Such a convergence is important, not only to keep monetary union stable in the medium and long term, but also to safeguard economic growth and prosperity.
It would also shift the composition of intra-regional trade from intermediate inputs for the production of goods for final demand to the traditional markets, to a more balanced composition with increased share to meet final demand within Asia. First, as the emerging economies, in particular Asia, gain importance as growth centres, the cumulative markets of Asia as export destinations will expand over time. The rapidly rising Asian middle income class will increase final demand for goods and services. Second, Asia can leverage on its immense diversity as a source of economic complementarities. The “Flying Geese Model” illustrates how Asia had, in the past, harness the diversity of the. Going forward, similar emphasis can be adapted beyond merely for the production of goods for final demand outside Asia, and draw on the different comparative advantages of the Asian economies. Financial integration as a third strategy The third strategy is the promotion of deeper financial integration. This is important for further advancing the economic development of the region. Financial integration is generally associated with capital mobility and refers to the extent to which an economy's financial system is interconnected with other financial markets. A fully integrated financial system will be one in which potential market participants, both in the banking sector and financial markets, adopt a single set of rules, have equal access and are treated equally.

Philipp Hildebrand: Global economic prospects and key challenges for monetary policy Summary of a speech by Mr Philipp Hildebrand, Member of the Governing Board of the Swiss National Bank, at the Money Market Event, Zurich, 23 March 2006. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch)  *  *  *  Summary Current economic developments are basically in line with the SNB’s expectations. Global economic activity is robust and the outlook is bright. The SNB expects broad-based growth of over 2% for 2006 and a moderate rate of inflation of approximately 1%. In addition to the usual economic risks, monetary policy today is faced with three key challenges. First, the effects of globalisation on inflation must be anticipated. Second, the way in which the interaction between globalisation and an ample supply of liquidity affects the price development of several assets needs to be analysed. The SNB's monetary policy concept enables it to take a long-term view and to recognise possible distortions early on. Third, identifying the neutral interest rate has become more difficult in today's environment. Many factors tend to support a lower neutral interest rate, while others would support a higher neutral rate. Against this background, the SNB will continue the gradual normalisation of its monetary policy. The scale and timing of this normalisation process will depend on further economic developments. Owing to a favourable inflation trend and well-anchored inflation expectations, we are in a position to cautiously approach a neutral interest rate level.
For example, a team of New York Fed economists published a series earlier this year aimed at understanding the gap in COVID-19 intensity by race and by income.3 And last month, they shared their findings around racial differences in ICU stress during the third wave of COVID-19.4 1/2  BIS central bankers' speeches  There’s no single or simple solution that can fully address these problems. But, as a nation we can build a stronger foundation so that everyone can fulfill their economic potential, thus better enabling the Federal Reserve to fulfill its mandate. That’s why at the New York Fed—and across the Federal Reserve System—a key area of focus is to better understand economic drivers of health and wellbeing, and to champion promising solutions. We are able to do this in large part through our Community Development efforts to better understand the needs and issues of low- and moderate-income communities throughout our District. Our Community Development team recently adopted a new strategy to concentrate on three key areas: health, household income, and climate.5 Our aim is to connect people, programs, and proposals—especially those focused on fostering racial equity—with the funding needed to promote equitable growth and tackle economic inequality. We are already doing important work in this space and there is so much planned for the future.

To conclude my talk today, I would like to reaffirm that our fundamentals are strong and that we in Thailand will do our best to regain full potential to achieve sustainable economic development. BIS central bankers’ speeches  3  Let’s think about challenges of the bear during winter. Even while hibernating, the bear cannot stay perfectly still. It needs to move and keep its muscles warm to prepare for spring. Thailand’s current economic condition is like a winter, we stakeholders are the bear that is hibernating, and like the bear, we must prepare for the coming spring. If we keep playing our roles in managing the economic transition, we will all reap the benefits of the turnaround. Thank you. 4  BIS central bankers’ speeches
Thus, we have witnessed a convergence in the monetary policy regimes of our two countries. Today, the two regimes are quite similar in three important respects. Both the Fed and the Bank of Japan place considerable emphasis on an explicit inflation objective, commit the central bank to use all available tools to achieve its objectives, and use forward guidance on interest rates and large scale purchases of long duration assets as the main tools to achieve these objectives. Although there are still some important distinctions in how policy is conducted, much of these relate more to differences in legal frameworks and the current starting point for economic activity and inflation rather than fundamental differences in philosophy. For example, the BoJ’s asset purchases are broader than the Fed’s, extending to equity ETFs (Exchange Traded Funds) and REITs. This option is not available to the Federal Reserve because the Federal Reserve Act sets tighter limits as to the types of assets that the Federal Reserve can purchase. Similarly, current circumstances in the two countries are different, with deflationary expectations still in the process of being dislodged in Japan. The BoJ needs to push up inflation expectations, whereas in the U.S. the current level of inflation expectations is consistent with the long-term objective of the Fed. Therefore, the BoJ, relative to the respective sizes of the two economies, has adopted a purchase program that is more aggressive that the U.S. program.

This program is gradual in nature and aims to reduce inflation, which had reached 91% by the end of 1997, to single digits over the medium term. All we know is that the disinflation program has three components: counter cyclical fiscal policies, structural reforms, and nominal policies. Let me make some comments firstly on fiscal and nominal policies. Turkey’s inflation has a long history. It originated mainly from budget deficits and the way they have been financed, and for this reason fiscal policies should be the backbone of any Turkish anti-inflation program. Calculations indicate that a primary surplus of 4–5% during the first two years of the program should be enough both to relieve the pressure on domestic demand and on domestic borrowing and demonstrate that the fiscal authorities are serious about reducing inflation. A tight fiscal policy will also lighten the burden of stabilization efforts, making a more flexible monetary policy possible. The monetary program is also consistent with these fiscal policies. At the Central Bank we have focused on net domestic assets since the second half of 1998. Bringing these aggregates under control conveyed two basic messages: first, that public sector deficits would no longer be monetized with the Central Bank resources, and second, that henceforward the Central Bank will increase its Turkish lira liabilities only to finance an increase in its net foreign assets.
The increase in the number of licences and authorisations issued by the ACPR illustrates this success: more than half of the 62 electronic money institutions and payment institutions currently in operation were licensed after 2018; the number of agents registered with the ACPR has risen by more than 40% in one year, with almost 3,300 decisions to register agents in 2021. 3- However, the framework established for open banking has its limitations. First, in terms of the openness of the market: the new service providers remain dependent on 1/5  BIS central bankers' speeches  traditional institutions, in particular for the opening of a segregated account, which raises questions given the difficulties that many Fintechs encounter in practice in accessing accounts. I n technical terms too. While the use of APIs makes account access more secure, these interfaces must also ensure that new entrants are able to provide their services at a level of quality that is consistent with their business model, as I will discuss later. B- As part of our supervisory duties, I can draw two lessons from these observations for the development of open finance regulations: one concerns the statuses that are necessary for the opening of the market, and the other concerns the technical means to ensure proper security. 1- While the creation of new statuses would appear to promote the emergence of new business models, we must nevertheless seek to limit unnecessary sources of complexity and, more fundamentally, the risks of regulatory arbitrage. Here are two examples to illustrate my point.

For some time the Riksbank has had a well-designed analytical apparatus for early detection of changes and vulnerabilities that could develop into a serious systemic crisis. Above all, its purpose is the timely detection of vulnerabilities in banks that are of central importance for the payments system, which requires knowledge of the status of the various institutions and how the market functions. This in turn presumes continuous follow-up, where frequent contacts with financial market participants play an important role. These established contacts are essential in a crisis situation, both to determine the type of measure that is needed and to ensure timely implementation. Ten years ago we began to publish stability reports twice a year. These reports provide a basic analysis of financial stability with an emphasis on the four major banks. The report leads up to a comprehensive stability assessment, highlighting the various risks to stability. Financial stability and implementation of monetary policy Monetary policy and financial stability have a fundamental relationship in the payments system. Through its repo rate decisions and by determining the conditions for the banks’ deposits in and borrowing from the RIX system, in practice the Riksbank determines the overnight rate, that is, the interest rate on overnight interbank loans. Through the steering system, the Riksbank aims to keep this shortest market rate close to the repo rate. The overnight rate in turn affects the interest rates offered to the general public, and thereby economic activity and prices.
The size of external imbalances, the capital flows associated with them, and the accompanying constellation of interest rates and exchanges rates reflect a range of factors, from differences in actual and potential growth rates, and the degree of competition in financial and product markets and the presence or absence of capital controls, to differences in monetary and exchange rate arrangements, the degree of financial market development, and the net borrowing requirements of governments, and to a whole range of different factors that affect savings preferences and the perceived return on private investment. The relative importance of these factors is hard to assess, as is their likely persistence. And this complicates the task of understanding the implications for policy. The challenge of explaining these anomalies is illustrated by considering some of the explanations now prevailing. The decline of thrift in the United States is one common explanation. The sustained decline in net national savings in the United States is the necessary counterpart to the rise in the current account deficit. But this observation does not explain why that growth has not been accompanied by an increase in longer-term interest rates. The robust productivity outlook for the United States relative to the rest of the world is consistent with an increase in the U.S. current account deficit, such as we experienced in the late 1990s. If this gap in potential growth were sustained, the United States would be able to sustain a larger external imbalance than we might have thought historically would be the case.

For the same reason, this phenomenon can act to mask or offset the effects of high levels of present and expected future government borrowing on interest rates, perhaps contributing to a false sense of reassurance that we can continue to run large structural deficits without risk of crowding out private investment and damaging future growth. BIS Review 18/2006  3  What might this mean for the conduct of monetary policy? To the extent that these forces act to put downward pressure on interest rates and upward pressure on other asset prices, they would contribute to more expansionary financial conditions than would otherwise be the case. And, if all else were equal, which of course is unlikely ever to be the case, monetary policy in the affected countries would have to adjust in response; policy would have to act to offset these effects in order to achieve the same impact on the future path of demand and inflation. To do otherwise would run the risk that monetary policy would be too accommodative, pulling resources from the future in a way that would alter the trajectory for the growth of the capital stock, perhaps amplifying the imbalances, and compromising the price stability. Finally, these aspects of global monetary arrangements and financial conditions have important implications for how we communicate about monetary policy. They strengthen the case for why central banks should be clear about their objectives and credible in their commitment to price stability.