samchain/econo-pairs-v1 huggingface dataset:
The next step in the process is likely to be the issuance by the SFC of a consultative paper. Another area which we are looking at is taxation. We acknowledge that there are serious anomalies in the current arrangements for taxing interest income in Hong Kong but, given the uniqueness of Hong Kong’s overall tax structure, and the conflicting aims of retaining international competitiveness on the one hand and preserving fiscal revenue on the other, there is no very easy solution. What we are doing is to sponsor, under the auspices of the Hong Kong Institute for Monetary Research, a fundamental study of the taxation of financial intermediation in Hong Kong. This study will hopefully further inform the debate on this tricky subject. I would not at this stage wish to guess as to the direction in which our advice will eventually point. BIS Review 57/2000  2  We are also overseeing the development of a US dollar payment clearing system for Hong Kong, which will provide an enhanced framework within which the market in US dollar debt securities could develop if issuers and investors so wished. There are also two initiatives on which we are actively engaged in collaboration with others in the region, though each is still very much in its early stages. One is the question of a possibly wider role for credit rating agencies.

Thus, three successive governments have been loyal to this guideline and it still enjoys a substantial majority backing in the Norwegian parliament. Adherence to this policy is also scrutinized closely by the public who have developed a sense of ownership of the Fund. Another important feature of the model is that there is consistency between the size of the Fund and Norway's net financial wealth. This is ensured by the Act relating to the Government Pension Fund where it is stated that the government cannot borrow as long as the balance of the Fund is positive. The Fund has become large and is still growing very rapidly. It is projected to reach 200 per cent of Norway's GDP around the year 2010. The huge cash flow into the Fund has posed an operational challenge, which I will return to later. In 2006, the name of the fund was changed from the Government Petroleum Fund to the Government Pension Fund – Global. But the name change did not imply any operational changes and the return (the 4 per cent) continues to be a general support to the budget, not ear-marked for any specific purpose. This reflects that the Fund has no formal link to a liability side. Let me turn to the management of the Fund. The Fund is formally owned by the Ministry of Finance, while operational management is delegated to Norges Bank. This arrangement is formalised through a management mandate given to the Bank by the Ministry.
The proportion of new owner occupier mortgage loans at loan-to-income ratios just below 4.5 has almost doubled in the past 5 years. Almost a fifth of new mortgages now fall into this bucket (see chart 4). In part because of our guards, households’ mortgage debt servicing burdens remain very low. Only 1.4% of households spend 40% or more of their income servicing their mortgage debts. And even if interest rates were to be at 2%, that share - at 1.9% - would be no more than it has been on average in the past. 7  For example, Bunn and Rostom (2015) find evidence that more highly indebted groups of households made larger cuts in spending following the financial crisis. See www.bankofengland.co.uk/working-paper/2015/household-debt-and-spending-in-the-uk 8 A loan to income limit, setting out that no more than 15% of new mortgages can be issued at loan to income ratios of 4.5 or higher; and an affordability test, under which lenders consider whether new mortgagors could still afford their mortgage if they switched to the mortgage reversion rate and interest rates were 3 percentage points higher. 7  All speeches are available online at www.bankofengland.co.uk/speeches  7  So there is no flashing warning light here telling us to pull over urgently. There is, perhaps, the light that reminds us the car is due for a service. Developments in corporate credit, consumer credit and in the mortgage market could be signs of a more generalised pick-up in risk taking.

And the Governing Council underlined at its recent meeting that, should it become necessary to further address risks of too prolonged a period of low inflation, it is unanimous in its commitment to using additional unconventional instruments within its mandate. Thus, many of the necessary conditions to restart credit growth are now in place. Yet, I think it would be short-sighted to claim that these alone will be sufficient. Coming out of a major financial crisis, it was always clear that repairing the bank lending channel would be a longer process, and the measures I have just described would only be the first steps in that process. One of the most important issues now in the repair process is how banks adapt to the challenging business environment that has been bequeathed by the crisis. The banking sector in transition The euro area banking sector remains in transition. At present banks generally have low revenues and profitability arising from several factors, including legacy factors such as loan losses during the crisis; cyclical factors such as the weak macroeconomy; and in some cases regulatory factors such as the costs of adapting to new legislation. This is reflected in historically low returns on equity: the median return on equity for euro area significant banking groups is currently 5%. It is unlikely, and indeed undesirable, that we will see a return to the high returns on equity we saw before the crisis, which were distorted in particular by excessive leverage and maturity mismatch.
However, we differ from other countries in two areas in a somewhat disadvantageous way: first of all, we let a portion of the large-value transfers go through multilateral netting before being settled in Norges Bank. This is not common, but obviously contributes to less stringent liquidity requirements (this occurs in Germany and the US, among others). Second, in Norway we still make use of so-called “T-copying”, in which the payee receives information on payments before the settlement has taken place.9 This creates the risk of the payee bank crediting the customer before the bank has received the money. The payee bank may thus be exposed to a non-controlled risk relative to the payer bank. On the whole, however, we may conclude that we have come a long way relative to the systems some of us recall from 10-15 years ago. 3.2.2  Risk can be further reduced  In spite of the progress which has been made, I still think that risk in the Norwegian clearing and settlement system can and should be reduced. Allow me to point out three areas where I believe risk is still too high: Retail netting in NICS Turnover in this area has been high and on the rise. Average daily turnover is now NOK 28bn compared with about NOK 18.5bn in 1998. Turnover has reached up to NOK 76bn on certain days. 8 9  NBO: Norges Bank’s settlement system.

Often this is due to a lack of information about what the actual risk is to the customer, the bank and the entire payment system. In this respect, the banks have an important responsibility to identify and manage the risk in the payment system. Only then will it be possible to say that the risk is “known and understood”. Norges Bank also has a responsibility in this area, such as establishing a regulatory framework that provides better incentives than what the present system offers. We all have a common goal: a more efficient and secure payment system. BIS Review 7/2000  14
Now, I would like to take the opportunity to respond to some concerns that under our Linked Exchange Rate system, the Hong Kong dollar will appreciate alongside the US dollar, thereby weakening the competitiveness of our economy, in particular the tourism industry, and dealing a blow to the wobbly retail and tourism sectors. I wish to point out that there is no evidence to suggest a direct linkage between the recent decline in visitor numbers and BIS central bankers’ speeches  3  expenditure, and the exchange rate of the Hong Kong dollar. The Nominal Effective Exchange Rate (NEER) of the Hong Kong dollar rose by 6.6% year-on-year in the third quarter this year, but price levels for tourism-related merchandise and services fell by a greater magnitude. For example, prices for jewellery, clocks and watches fell by 8.2%, while the average room rate for hotels fell by 15.3%, which more than offset the effects of a stronger Hong Kong dollar. This clearly shows that Hong Kong’s economy is sufficiently flexible to adjust speedily to changing markets. 19. In addition, Hong Kong is different to other EMEs. We have sound and robust monetary, banking and financial systems. In response to the large capital inflows over the past few years, we have got ourselves well-prepared by introducing seven rounds of countercyclical macroprudential measures on property mortgages to enhance the resilience of the Hong Kong banking system.

In this case, we can expect that in the third and fourth quarters economic activity will be recovering quarter-on-quarter. The economic situation will be returning to normal step-by-step. The direct adverse impact of the restrictions primarily falls on this quarter, while their secondary effects will continue to manifest in the future. According to our surveys, over 80% of the businesses across various industries have been experiencing the influence of the coronavirus pandemic and current 1/3  BIS central bankers' speeches  restrictions. Companies’ business sentiment has materially declined. It will take time to restore business processes, logistics and production chains, offset the reduction in profit and revenue, build up reserves and savings that have been used to a greater or lesser extent over the second quarter. Combined with uncertainty regarding potential changes in the external environment, this will limit production, investment and consumer activity. In these conditions, GDP will shrink yearon-year in the third and fourth quarters, that is the annual rate of economic growth will be negative. According to the Bank of Russia’s forecast, GDP will overall decrease by 4–6% in 2020. The major contributor to this reduction will be a decline in exports that may reach from 10% to 15%. Moreover, fixed capital investment will also substantially decrease (by 6– 10%) compared to the previous year. Companies will be primarily using their financial resources to restore their daily operations. Uncertainty about the prospects of domestic and external demand will be confining investment plans.
Indeed, the Constitutional Organic Act mandates the CBC Board to present at this time of the year an evaluation of the progress of the policies and programs of the current year, a report of those proposed for the following calendar year, the overall economic projections that sustain them, and a recount of the factors that can affect its balance sheet. In other words, it is not just about presenting the Monetary Policy Report, but a more complete account about the evolution of our institution. However, today I wish to go beyond the usual institutional account. I would like in particular to recount the content and progress of the Bank’s Strategic Plan that I anticipated on this same venue last year, as well as share some additional steps that we intend to take on the issue of institutional transparency. Our Strategic Plan 2018-2022 was prepared during the better part of last year and is currently in full implementation. Although this type of exercise was not new to our institution, this time it relied on an extensive process of external consultations, gathering of relevant information and internal deliberation unprecedented in the CBC, which is very innovative 9  for the central banking community in general. This exercise was completed at the end of 2017 with the approval of the Plan. Below I summarize its main contents and advances. This Strategic Plan 2018-2022 updated the basic definitions of the CBC’s institutional mission and vision.

The main risk continues to be an abrupt deterioration of financial conditions facing emerging economies, especially because markets seem to be more reactive to negative news. In this area, what happens in the US is still relevant, in terms of both the evolution of inflation and its outlook and the unfolding of the trade conflict. This situation has revived the fears about China, especially the risks implicit in the imbalances it maintains in several of its markets. In Europe, among other issues, the uncertainty surrounding Brexit is cause for concern. In the context of normalizing global financial conditions, investors have drawn a line between the emerging economies they perceive as more vulnerable and those with more solid fundamentals. Chile meets the current situation with good macroeconomic indicators in terms of growth, inflation and the balance of its fiscal and external accounts. Moreover, our floating exchange rate makes it possible to cushion external shocks, and the monetary policy framework permits us to act countercyclically. This is feasible due to the low exposure to interest rate and exchange rate risks by the main economic agents. On financial matters, one issue drawing attention in this conjuncture is the external debt. The Box in this Report, entitled “Financial Volatility and External Debt”, provides an in-depth analysis of this issue, particularly with regard to corporate debt.
Since this is not the main topic of our discussion today, I will simply give a brief reminder of the facts.   The role of central banks in markets stems from their objectives, the primary one incontestably being to ensure price stability. But this is not their sole objective. As we know, the Fed operates under a “multiple mandate” that is, and I quote, “to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates” whereas most other central banks, and in particular the ECB, have a “hierarchical mandate” that places the price stability objective above all other policy goals. More specifically, the Maastricht Treaty states that “without prejudice to the objective of price stability, the ESCB shall support the general economic policies in the Community with a view to contributing to the achievement of the objectives of the Community”. In that perspective, one of the objectives of the Community that we must support is to “promote solidarity among Member States”.   In order to fulfil its mandate, central banks must be credible and thus independent. If economic agents have the least doubt or the least suspicion that the institution might have an incentive to surprise them by allowing high inflation, they might adjust their behaviour as a precaution and thus “create” higher inflation by increasing their wage claims, thereby triggering a wage-price spiral; or by demanding greater returns on their savings, which pushes up long-term interest rates and weighs on growth.

And we emerged from all this with the most robust banking system in the region. Indeed, the HKAB and HKMA partnership is a very important one, as we continue, in accordance with the requirement laid down in the Basic Law, to develop Hong Kong as an international financial centre. And there are many more challenges ahead for us that require an even stronger partnership to handle. We are all well aware of the forces of globalisation and technological advance, and the opportunities and risks associated with them. The Asian financial turmoil has also put us on clear notice that those forces, made more potent by the activities of the highly leveraged institutions, can be brutal and do not tolerate excesses or mistakes. It takes great effort, particularly in a small and entirely open international financial centre, for both the regulated and the regulator to harness these forces, and derive and maximise the benefits that undoubtedly flow from them. This process is likely to involve changes to both the structure of the banking sector and to the supervisory framework, perhaps to the extent of affecting special interest groups. But the fact of the matter is that changes are inevitable. And in coping with them, we have a choice between either dealing with the relevant issues ahead of time, making full use of our strong partnership, or leaving them to the brute forces of the market.
Ida Wolden Bache: Norges Bank is raising the policy rate to bring down inflation Introductory statement by Ms Ida Wolden Bache, Governor of Norges Bank (Central Bank of Norway), at a press conference following the announcement of the policy rate, Oslo, 3 November 2022. *** Accompanying charts of the speech. Introduction Chart 1: Policy rate raised from 2.25 to 2.5 percent Norges Bank's Monetary Policy and Financial Stability Committee decided unanimously to raise the policy rate by 0.25 percentage point to 2.5 percent. Norges Bank's task is to keep inflation low and stable. The operational target is inflation of close to 2 per cent over time. We are also mandated to help keep employment as high as possible and to promote economic stability over time. Economic activity is high in Norway, and unemployment is at a historically low level. At the same time, we are seeing that some areas of the economy are cooling down. Inflation is very high. Many people are experiencing how demanding it can be to cope with rapid and unexpected price increases. High inflation is weakening households' purchasing power and hampering economic decision making for both firms and households. We believe that a higher policy rate is needed to curb inflation. In its deliberations, the Committee was concerned with balancing the risk of tightening too much against the risk of tightening too little.

At the same, we are seeing signs of a cooling housing market. House prices fell more than we had expected in September, and the number of unsold homes has increased. According to Statistics Norway's business sentiment survey, the prospects for manufacturing have weakened. The labour market is tight, and the employment ratio is high. The number of employed appears to be slightly higher than expected, while the number of unemployed has been a little lower. The number of job vacancies is high, but the number of new vacancies has decreased slightly. Chart 4: Inflation is high Inflation has continued to edge higher and is markedly above our target of 2 percent. In the year to September 2022, consumer prices rose by almost 7 percent. Energy prices were a main driver, but prices are also rising rapidly for a range of other goods and services, both for domestically produced and imported goods and services. In September inflation was higher than we had expected, with a surprisingly sharp rise in transport prices, which tend to vary widely. The Committee judges that a higher policy rate is needed to bring inflation down towards the target. Inflation has increased more than projected, and the labour market appears to be a little tighter than previously anticipated. These developments could suggest raising the policy rate by more than 0.25 percentage point at this meeting. On the other hand, there are signs that some areas of the economy are cooling down, and prospects for lower-than-expected freight and energy prices may curb inflation ahead.
When the bonds matured, the Norwegian government wanted to make the repayment in banknotes that had lost much of their value. This implied a devaluation that could perhaps be compared to the devaluation under Henry VIII. The case finally came before the Supreme Court in 1962. In their voting, the Supreme Court gave weight to a law from 1923, which stated that the gold clause, i.e. repayment in gold money, did not apply when the obligation to redeem banknotes for gold had been suspended, which was permanently done in September 1931. In the explanation of their ruling, the Supreme Court also referred to “vital national interests”. It would cost Norwegian taxpayers far too much to repay the gold money that had been borrowed 60 years earlier. It would be far too pretentious of me to offer an opinion on the court ruling as such. What makes this case interesting in the light of today's topic is that in the Supreme Court's assessments of “vital national interests”, there is no discussion of what the nation's interests are in the short term versus the long term. However, it must be added that it is probably not easy for a court to review other government authorities’ assessments of this point. There is also the question of whether this falls within the court's purview. 5. Modern monetary policy – a promise both possible and right to keep  The theoretical breakthrough by Kydland and Prescott and the era of high inflation eventually had implications for practical policy.

And I am convinced that today’s conference will play an important role in sharing developments in the frontier economies – the next wave of emerging economies which will contribute to the regional and global growth and prosperity. 17. Last but not least, I would like to express my sincere gratitude to our cohosts, the International Monetary Fund (IMF) and the Japan International Cooperation Agency (JICA), who make the conference possible. I wish you all a successful conference and look forward to your discussions. 18. Thank you. BIS central bankers’ speeches  3
17 17  Jul.17  1818  Jul.18  19 19  (*) As from January 2019 the line uses the new indexes with 2018=100 annual base, so they are not strictly comparable with past figures. Sources: Central Bank of Chile and National Statistics Institute (INE). 9  Figure 3 Selected CPI prices (indexes, January 2018=100)  Mobile phone services  101  Telecom package services  101 105  105  100  100 100  100  99  99  95  95  98  90  90  98 16  17  18  19  New cars  110  16  105  100  100  95  95 16  17  18  18  19  Air transport services  110 160  105  17  160  120  120  80  80  19  16  17  ----2013 basket  18  19  ----2018 basket  Source: National Statistics Institute (INE).

The pre-announced monthly cycle of meetings, regular quarterly Inflation Report forecasts, and set briefing routines, were very much part of the package. The goal of these new arrangements was to make the system understandable and predictable to outsiders. After a sharp burst of activity in the late 1990s, the processes and procedures surrounding monetary policy have now settled down. We still use much the same internal processes and means of communicating with the outside world as we did a decade ago. But the outside world has not stood still, in at least two respects. First, over time the MPC has established a track record of actions and communications which people have, as intended, learnt to parse with great precision. There is a cottage industry in interpreting its every utterance, in the light of its past behaviour, in order to predict its next actions. Any deviation from past behaviour is assumed to be deliberate and considered. A topical example is the market reaction to the latest interest rate rise. The formal position has always been that the MPC may change rates at any one of its policy meetings. And in the early days of the Committee that’s pretty close to what happened. But since 2001, as a matter of fact, rates have been much more likely to change in the months when we publish a new quarterly Inflation Report. That was why the January rate rise caused such surprise even though commentators were fully expecting a rate rise to accompany the February Inflation Report.