samchain/econo-pairs-v1 huggingface dataset:
CRE valuations have fallen by about 10 per cent from their peak in June 2022 and equity valuations of European real estate groups continue to fall.6 In this context, the ESRB issued a Recommendation earlier this year to help address vulnerabilities in CRE markets.7 The sector is particularly vulnerable to lower growth, heightened inflation and higher interest rates. Rising vacancy rates result in lower income streams and lower property values. Lower collateral values and tighter financing conditions reduce CRE investors’ scope for refinancing existing debt and for taking out new loans. This, in turn, may force some investors to sell properties to meet maturing debt obligations and liquidity needs, even under stressed market conditions, thereby adding further downward pressure on prices. The cyclical vulnerabilities are compounded by adverse factors that relate to structural change. They include the impact of climate-related economic policies, the shift towards e-commerce and a greater demand for flexible office space to accommodate mobile and hybrid working models. And large falls in CRE prices could lead to spillovers on the financial system. Let me now turn to risks related to financial market corrections. This is important as all financial institutions, including banks and non-banks, interact in financial markets. Such asset price corrections and heightened volatility could be exacerbated by vulnerabilities in the non-bank financial sector. In fact, there have also been several episodes of market volatility in recent months that resulted in liquidity challenges for non-bank financial intermediaries.

On the positive side, the EU economy proved to be more resilient than expected in the face of the large negative terms-of-trade shock from Russia’s war in Ukraine and growth forecasts for 2023 were revised upwards. However, developments last autumn in the UK gilt market and, more recently, in the US and Swiss banking sectors remind us of the need to remain vigilant in regard to vulnerabilities in a challenging and rapidly changing macro-financial environment. In this context, let me explain the ESRB’s view on the key risks affecting the European Union’s financial sector. The aforementioned ESRB Warning set out four key risks to EU financial stability:3 • The challenging macroeconomic outlook coupled with elevated geopolitical tensions underscores the importance of a prudent management of credit, market and funding risks in the banking business. • An environment of still subdued growth prospects and elevated inflation may put firms' and households’ balance sheets under stress. • Vulnerabilities in the non-bank financial sector could trigger asset price corrections and amplify volatility. • System-wide cyber incidents remain a severe threat. The Warning has promoted a closer monitoring of risks by national and EU authorities that are members of the ESRB. Let me now offer an update of our current assessment. The EU banking sector remains strong in terms of its aggregate capital and liquidity position.
Let me elaborate on these two themes: why liberalise the financial sector, and why liberalise at a measured pace. In doing so, I will draw partly from Singapore’s experience. Singapore and Myanmar are two very different economies and it would be unwise to apply Singapore’s experience directly to Myanmar. But I think the overall lesson is relevant: It is critical to open up, but open up at a measured pace. Why financial liberalisation is important A well-developed financial sector can be a catalyst to spur and sustain economic growth. It will lead to more effective mobilisation of domestic savings, help to harness foreign savings, and improve the efficiency of investment allocation. And opening up the financial sector to foreign participation can play a critical role in catalysing the sector’s growth and development. A basic purpose of banking is the provision of credit for economic and social development. Large segments of the Myanmese economy and population do not have access to affordable funding. Foreign financial institutions can complement the local banks in effective credit intermediation. It will deepen the financial sector, thereby helping to raise household savings and divert funds away from the shadow financial system. Foreign financial institutions can provide a channel for Myanmar to tap into foreign savings to drive its growth, even as the country ramps up the mobilisation of domestic savings. This is  BIS central bankers’ speeches  1  particularly relevant for financing infrastructure development, which is critical to drive Myanmar’s economic growth.

Ravi Menon: Myanmar must open up at a measured pace Keynote address by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at High-Level Seminar on Financial Sector Liberalisation, Nay Pyi Taw, Myanmar, 10 January 2014. *  *  *  His Excellency U Win Shein, Union Minister, Ministry for Finance and Revenue, His Excellency U Kyaw Kyaw Maung, Governor, Central Bank of Myanmar, distinguished guests, ladies and gentlemen, good morning. A defining moment I am pleased to be here for this high-level seminar on financial liberalisation. This collaborative event is a clear testimony to two things: •  first, the commitment and resolve of the Myanmar government and central bank to modernise and develop the financial sector; and  •  second, the warm relationship and close co-operation between the central banks of Myanmar and Singapore. Myanmar is at a defining moment. There is a distinct sense of optimism, as the country rejoins the global economy. A strategic location at the intersection of China and India, a generous endowment of natural resources, and a large, youthful and literate population – Myanmar is poised to be the next economic frontier in Asia. Finance is a handmaiden to the economy. As Myanmar opens up its economy and seeks to achieve sustained growth, it is important to liberalise and develop its financial sector in concert. But it must do this in a progressive and calibrated manner, step-by-step, making sure the fundamentals and preconditions are in place.
Prasarn Trairatvorakul: The ASEAN Economic Community’s impact on the Greater Mekong Subregion’s economies Keynote address by Dr Prasarn Trairatvorakul, Governor of the Bank of Thailand, at the Euromoney Conference “The Greater Mekong Investment Forum”, Bangkok, 12 June 2014. *  *  *  Excellencies, Honorable Speakers, Distinguished Guests, Ladies and Gentlemen, 1. It is an honor for me to be back here at the Euromoney Greater Mekong Subregion Investment Forum. Let me thank the organizers for inviting me to speak at such a distinguished forum once again. This conference takes place at an important juncture as we are on the eve of the ASEAN Economic Community which will be launched at the end of next year. My remarks today will focus on how the AEC will have meaningful impacts on the GMS economies. Also, I will share with you some thoughts on how we can overcome challenges to capitalize on the region’s growth and prosperity. 2. The GMS has become one of the most vibrant regions in the world, transforming itself into a new investment frontier. The global attention on this region is reflected in the large inflows of foreign direct investment, which have increased dramatically in the past two decades. According to World Bank statistics, the FDI inflows to the CLMV countries over this period increased forty-fold to around 13 billion dollars in 2012.1 This wealth of investment opportunity has been underpinned by the smooth transition to market-based economies, the rich and diverse resources as well as the improvement of intra-regional logistics. 3.

What ASEAN central banks are aiming for is to enable businesses and individuals to make and receive electronic payments more conveniently yet less costly. A prominent example here is the “Asian Payment Network” which translates to full regional ATM interoperability. Through this initiative, an ASEAN  1  World Bank website (2014) (http://data.worldbank.org/indicator/BX.KLT.DINV.CD.WD)  2  ASEAN-6 includes Brunei Darussalam, Indonesia, Malaysia, Philippines, Singapore and Thailand. BIS central bankers’ speeches  1  resident, for instance, can use his or her local ATM card to withdraw cash from a machine in another ASEAN country without having to pay the fees charged by third-party payment providers. 8. We can see that the upcoming realization of the AEC is a springboard for a more vibrant GMS region. However, the benefits for the region go beyond the AEC. I can see some points where tangible outcomes will take place in the near future. 9. The first one is the more integrated production networks of the main industries which dominate the GMS. We all know that the region has a comparative advantage in primary industries which are demanded by other ASEAN countries. This is why we have observed the large inflows of investment into agro-industry, garment and mining sectors. Realizing the high potentials of these sectors, we have also seen contract farming practices in Laos, where key commodities such as corn and sugarcane are produced using advanced technology and practices. 10. The other point concerns the development of infrastructure.
RPI inflation has risen to 4.4%, the highest rate since December 1991. And RPIX inflation – the target which governed our decisions until December 2003 – has risen to 3.8%, which would have triggered a letter under the old target. In 1997, I suggested that “Given past experience of inflation volatility, it is likely, even allowing for the change in policy regime, that the MPC will have many opportunities to restore the lost art of letter writing to British life”. It is really very surprising that no opportunity has yet arisen. As I stressed back then, it is important to understand – and many commentators seem to misunderstand – that the inflation target is not a range of 1-3%, but a target of 2% at which the Monetary Policy Committee continually aims. So an inflation rate of 3.1% is simply a trigger for a public explanation of why inflation has risen above target and what the Committee proposes to do about it. Letter writing is a key part of the accountability provisions of the monetary policy framework created in 1997, and I would welcome the chance to demonstrate how the process is meant to work. The opportunity to write to the Chancellor did not arise last week. But since we are so close to the level that would trigger a letter, let me instead write a letter to you. Over the past year CPI inflation has risen by a percentage point, from around 2% to 3%.

I have been impressed by how they have focussed on products in which they can add value and exploit their comparative advantage – whether a company in Northern Ireland exporting wall heaters to the newly rich of Shanghai and Beijing, a manufacturer in the North-West exploiting a patent for paint which is resistant to very high temperatures, or a company in the Potteries passionate about the plates they make for the hotel and restaurant trade. And if you want a digger, why look further than a JCB? Proof that vehicle assembly in the West Midlands can be successful. All of them – as all of you – are working in a highly competitive environment. It is indeed much harder to run a business than to run a central bank. But seeing those companies at first hand has made me even more convinced that our duty is to ensure that you do not experience the macroeconomic instabilities of the past and that we keep inflation on track to meet our 2% target. Stability is in your interest just as much as mine. Speeches on monetary policy rarely whet the appetite for a good meal, and I apologise for that before the splendid dinner your Chamber is about to serve. But tonight has been an opportunity to share our analysis of the economic situation with you. I hope you will understand the reasons behind our decisions to raise interest rates over recent months, even if it goes against the grain to support them.
This is not only exemplary, it is an important lesson we can learn from the crisis for use in the future, and it holds true not only for households but for companies and public entities as well. There are many ways to express this message, but allow me to refer to French classical literature and recall for you Jean de la Fontaine’s celebrated fable about the cricket and the ant: “La cigale et la fourmi”. In the fable, the cricket who had not accumulated surpluses during the plenteous summer days preceding the crisis, found herself “fort dépourvue quand la bise fut venue”, that is, she “found when the winter winds blew free, her cupboard bare as bare could be”. The fact that, in this situation, the ant of the fable was not eager to lend to the singing cricket lends further realism to the analogy. II. Current environment and short-term prospects  What now? We are not yet ashore and the relatively positive assessment of the previous paragraph does not reflect a definitive evaluation. First, private consumption could be less robust should conditions on the labour market improve less than currently anticipated or even deteriorate again. Here the main worry is the ability of the Swiss economy to quickly reabsorb the 60,000 individuals working on a short-time basis. Recently, developments have been encouraging. In turn, the situation of the labour market depends on the continued recovery of the 60% share of the economy that is geared to international markets.

new mountains that underline the importance of policymakers' capacity to climb up the top. In only two years, the world we knew has dramatically changed. The humankind has faced threats that seemed to be forgotten in the modern world, an unprecedented pandemic and a war in Europe, which are not only a human tragedy, but also supply shocks with significant economic costs that may profoundly reshape the world economy and geopolitical landscape. This environment creates many challenges for the macroeconomic policies, as well. 1/4  BIS - Central bankers' speeches  The pandemic was a shock of unprecedented nature causing global supply disruptions, supply demand mismatches, and exceptional patterns of economic behaviour. However, the policy response was of unprecedented nature and size, contributing to relatively swift and job-reach recovery. Thus, for example unlike GFC when it took seven years for the euro area GDP and almost twelve years for unemployment to return to its pre-crisis level, this time it took only one year to return to pre-crisis level and unemployment to hit record low. These developments are also relevant for some of the CESEE transition economies with strong trade and financial ties with the advanced Europe. This was a showcase of how a sizable and wellcoordinated monetary and fiscal mix can mitigate the adverse effects of a large exogenous shock. Unfortunately, while calibrating our exit strategies and reverting to a normal mode, another shock wave came pushing energy and food prices further up the curve, hence accelerating inflation while overshadowing growth recovery.
Transparency is traditionally not a focus of supervisors, so it needs to be explicitly enacted, independently of how supervision is organised. The fourth condition is the efficiency and efficacy of supervision. Does the authority perform its services at a reasonable cost? To a large extent this depends on the organisation of the work itself and not the overall supervisory structure. There is also an argument of economies of scale and scope, implying that some costs could be reduced if you combine the supervisory authorities. 2  BIS Review 49/2007  A more important aspect of efficacy is whether the authority lives up to its stated objectives, for instance to ensure a safe and sound financial system. This has not so much to do with the organisation of the authority but more with its legal powers and independence. An even broader issue concerns the appropriate range of objectives for a supervisory authority, for instance if consumer protection, competition policy or promotion of the financial sector should be included together with the basic objective of financial stability and smooth operations in the financial sector and its institutions. My experience from many countries is that it is usually more efficient to separate these objectives between different authorities. For instance, handling consumer issues is resource intensive and may negatively affect confidence in the supervisory authority. Having too many objectives might also lead to conflicting goals for the authority.

If we plant the financial literacy seed now, we will watch as our children and students grow and bloom into responsible economic citizens. As parents, teachers and educators, we can do this by sharing and talking directly with our children about money matters, teaching them of the things to improve their money management skills, and be role models for them. To the winners of the 2014 Be Money $ poster competition, I offer my heartfelt congratulations! You have done a magnificent job with these posters – your entries were chosen out of 550 entries submitted to us! I only pray that you will exercise some financial literacy with your cash prizes received today!! I would also like to acknowledge the principals and teachers for encouraging your students to participate in the competition and for incorporating financial literacy in your lessons. With the BIS central bankers’ speeches  1  rewards that your individual schools will receive today I hope you are now ever more convinced that financial literacy is worth it and that it $ off! At this point I would like to acknowledge Meilan Meredith and her team at Business System Limited for the wonderful partnership in the poster competition and kindly donating prizes and trophies for our winners today. Your partnership is greatly appreciated and we look forward to another opportunity to work with you in the future. And lastly, a big faamalo to the Financial System Development team for coordinating this year’s poster competition. I wish you all, a very blessed weekend.
It has also triggered some pass-through to other goods and services: it is estimated that a 10 pp increase in food commodity prices ultimately has a 0.4 pp impact on headline inflation (HICP) after one year. 7. Underlying inflation has risen significantly, amounting to 4.9% in August in Spain (4.3% in the euro area). In August, 43% of items saw inflation of more than 4% (over 50% in the euro area). In Spain the contribution to this increase was particularly high in the case of restaurants, cafés and the like, accommodation services and motor vehicles.5 “Recreation, hospitality and tourism” contributed 1.6 pp to headline inflation in Spain, compared with 1.1 pp in the euro area.6  1  For instance, at the end of summer 2021 gas prices and, therefore, electricity prices, were expected to correct downwards sharply from spring 2022. However, according to the futures market, this correction is now not expected until 2023. 2  See J. M. González-Mínguez, S. Hurtado, D. Leiva-León and A. Urtasun (2022). “De la energía al resto de componentes: la generalización del fenómeno inflacionista”, Artículos Analíticos, Boletín Económico, Banco de España, forthcoming. 3  Fertilizer and natural gas prices are very closely related. In addition, the war has represented a further shock to agricultural commodities, as Russia and Ukraine account for high shares of the corresponding international markets. 4  This behaviour does not differ from that observed in prior episodes of rising prices, such as the 2008 global food price crisis.

This highly uncertain setting is also reflected in the dispersion among experts in the oneyear economic outlook for the euro area. This dispersion is very high in the case of GDP – close to the levels observed in the 2008 financial crisis – and stands at an all-time high in the case of the one-year inflation outlook. 3. The role of economic policy In response to the inflationary episode, the ECB has accelerated the process of normalising its monetary policy The sharp rise in inflation prompted the ECB to respond by embarking on a process of monetary policy normalisation in late 2021. In March we discontinued net purchases under the pandemic emergency purchase programme (PEPP). On 1 July, once the conditions set out in our forward guidance had been met, we brought an end to the net purchases under 7  the asset purchase programme (APP). In late June, we raised interest rates by 50 basis points (bp), thereby exiting negative territory for the first time since 2014. September saw a further increase of 75 bp, the biggest hike in the history of the euro. In July we also approved a new instrument, the “Transmission Protection Instrument” (TPI). Subject to fulfilling the criteria established, under the TPI we will be able to make secondary market purchases of securities issued in jurisdictions experiencing a deterioration in financing conditions not warranted by the economic fundamentals, to counter risks to the monetary policy transmission mechanism to the extent necessary.
The greatest challenges we face are global. In addressing these challenges we should build on fundamental economic principles. The climate challenge is calling out for cost-effective solutions, nationally and globally. The liberalisation of global trade has brought undeniable benefits. But insufficient attention has been paid to the other side of the coin: Not everyone has shared in the benefits. The signs of growing protectionism are of concern. In a world facing common problems, going it alone is not the solution. If we all pull together, the burden becomes easier to bear. Come what may. 1 Bjerknes, V. (1943) “Hvordan Bergensskolen ble til” . In: Vervarslinga på Vestlandet 25 år. Festskrift utgitt i  anledning av 25-årsjubileet 1. juli 1943 [25 years of weather forecasting on the western coast. Festschrift published on the occasion of the 25th anniversary on 1 July 1943]. A.S. John Griegs boktrykkeri. Bergen. 2 Letter from Norges Bank to the Ministry of Finance, 1 December 2016. “The equity share in the benchmark index  for the Government Pension Fund Global”. 3 Report No. 2 to the Storting (1994–1995). Revised National Budget 1995, p. 68. 4 The calculations are based on Norges Bank (2016) “Asset allocation with government revenues and spending  commitments”. NBIM Discussion Note 4/2016. 5 Norges Bank (2017) “Experience with the monetary policy framework in Norway since 2001”. Norges Bank  Papers 1/2017. 9/9  BIS central bankers' speeches

This is especially the case when an important innovation occurs and market participants don’t fully appreciate the powerful feedback loops that first sustain a boom and then contribute to a bust when the process runs in reverse. This means that we as regulators must continually evaluate the financial system and monitor the landscape for new developments and innovations that, if taken too far, could lead to excess and put the system at risk. Second, when there are potential excesses that could threaten financial stability, we should look to temper them. For example, in the run-up to the financial crisis, macroprudential tools—such as requiring larger down payments or more closely evaluating the incomes of borrowers—could have been implemented to limit the demand for housing. If such an approach were successful, home prices would not have risen so dramatically, and the subsequent bust would have been less severe. Another approach would have required financial intermediaries to build stronger capital and liquidity buffers as protection against a housing bust and an economic downturn. Prior to the financial crisis, the conventional wisdom was that asset bubbles could not be identified in real time—rather, they could only be cleaned up after they burst. While there are significant challenges to identifying asset bubbles, it is clear that cleaning up only after they burst does not always work out well in practice. Third, we need to carefully monitor the incentives that govern the behavior of borrowers, savers, and financial intermediaries.