samchain/econo-pairs-v1 huggingface dataset:
Thereafter, the MPC expected that inflation was more likely than not to fall back and be below target for a period [Slide 5]. You can see that the most likely outcome, shown in the darkest band, was for inflation to stay below the target at the end of the forecast period. But the MPC also saw upside risks to that projection, stemming from the possibility that the current high level of inflation might become embedded in inflation expectations, so making inflation itself more persistent. To make these risks easier to discern, the MPC also makes available charts of the cross section of the probability distribution at particular points on the forecast horizon, like the one shown in [Slide 6]. The upside risks mean that at the end of the forecast horizon, the MPC judged that inflation was as likely to be above the target as below it. We can see this in the chart, because the narrower bands towards the left hand side mean that the mass below the vertical line marking 2% is about the same as the mass above it. But why do we show our projections like this? Many other economic forecasters publish their forecast as a single, most likely outcome. In our view, this sort of forecast is not very informative, as the actual probability of it being correct is very close to zero. In contrast, the whole distribution contains much more information. What matters for policy is the entire distribution of outcomes.

But growth has a price. This is particularly reflected in increased emissions of greenhouse gases as a result of increased human activity. It is still uncertain how serious the impact of gas emissions will be. But once the impact comes into full evidence, it may be too late to take corrective action. There is also the risk that the concentration of greenhouse gases in the atmosphere reaches such a high level that it exceeds critical values that cannot be reversed. We are very pleased to have Dr John Llewellyn, Senior Economic Policy Advisor at Lehman Brothers, here today to enlighten us on how globalisation affects the environment. Changes  BIS Review 27/2008  1  in our environment affect the way we are able to interact: it is important to combine knowledge about nature with knowledge about the functioning of the economy. The last decade or so, we have witnessed increased financial integration and competition across national borders. This is a positive development. Deeper and more mature markets tend to be better equipped to deal with uncertainty and distress. But increased financial integration also raises the potential for more widespread contagion if something goes wrong, as witnessed by the current financial turmoil. Professor Philip Lane, Director of the Institute for International Integration studies at Trinity College Dublin, is one of the foremost experts on financial globalisation, and we are very much looking forward to hearing what he has to say on this subject.
Although circumstances differ, our experience may also be of value to others. Forward guidance in general Up until the 1990s, the code of conduct among central bankers was one of secrecy. Today, however, central banks strive to be transparent. This development reflects a general trend towards greater transparency in modern societies. For some central banks, including Norges Bank, a change from fixed exchange rates to an inflation targeting regime also highlighted the importance of greater transparency. Transparency is necessary for accountability. With accountability the central bank can build credibility and trust, both by showing that the objectives are actually attained in the longer run, and by explaining deviations from targets. Forward guidance, understood as information about future policy intentions, may be viewed as a natural extension of this accountability framework. Economic agents are forward-looking, and hence the future stance of monetary policy matters to them. As Michael Woodford has stated, “For not only do expectations about policy matter, but, at least under current conditions, very little else matters.” 1 In macroeconomic theory, the importance of expectations has been appreciated since the rational expectations revolution of the 1970s. In the early 1990s, theorists started to model monetary policy as setting the interest rate. 2 Central bankers have since had a theoretical  1  Woodford, M. (2005): “Central Bank Communication and Policy Effectiveness,” NBER Working Paper 11898. 2  See Taylor, J.

1/5  BIS central bankers' speeches  Take the case of a vendor that provides critical services and is on the brink of bankruptcy. Are credit risk analysts, operational risk and business continuity professionals, and the business affected working together to share information, insights, and potential responses? Or, are silos preventing information from getting to the right people at the right time to prepare and act? Risk silos can result in siloed decisions, and looking at risks one by one is incoherent. We could drive operational risk to zero by having no operations (I guess we can all go home early), but then strategic risk rises to infinity. Since most meaningful decisions involve balancing risks, to get to the right decision, we need a risk picture that covers all relevant risk types and engages all relevant risk experts. Similarly, real world vulnerabilities do not have to conform themselves to a particular risk type. Think about weaknesses in identity and access management. This is a driver for risks ranging from cyber, to compliance, to operations, and more. This is also a type of risk that can’t be mitigated solely through technical controls put in place by information security experts; that is, a siloed risk response is insufficient. So, stronger collaboration and coordination across risk disciplines is one solution to the negative effects of risk silos. Another specific pain point created by risk silos is the flourishing, and perhaps overgrowth, of risk assessments. Most organizations have many risk reviews: often a different review for each type of risk.
2  BIS 2013 Triennial Central Bank Survey. The Triennial Survey is coordinated by the BIS under the auspices of the Markets Committee (for the foreign exchange part) and the Committee on the Global Financial System (for the interest rate derivatives part). The latest survey of turnover took place in April 2013. Central banks and other authorities in fifty-three jurisdictions participated in the 2013 survey. They collected data from about 1,300 banks and other dealers in their jurisdictions and reported national aggregates to the BIS, which then calculated global aggregates. The survey, among other things, provides data on turnover, instruments, counterparties, and currencies, which are referenced in this speech; http://www.bis.org/publ/rpfx13fx.pdf. 3  SIFMA US Bond Market Trading Volume; http://www.sifma.org/research/statistics.aspx. 2  BIS central bankers’ speeches  Changes to market structure The foreign exchange market is a dynamic market with a long history of change and innovation. Today, I would like to focus on two of the more significant recent changes in the market’s structure: first, the broadening of participation, and second, how execution is taking place within the market. Participation in the FX market The broadening of participation in the foreign exchange market is one reason why growth in FX trading volumes has far outpaced growth in global trade. The BIS Triennial Survey on foreign exchange market activity provides evidence of the degree to which this expanded participation is taking place. 4 Traditionally, volumes in the foreign exchange market were dominated by what is known as the inter-dealer market – trading between dealers.

I think this approach provides synergy; employs joint resources and enables more efficient achievement of the vision that we all share. I am pleased that we will formalize our commitment and readiness for joint action with the first Memorandum of Cooperation in the field of financial education and financial inclusion in Southeastern Europe. We must all strive to be strongly committed, not only to declare, but also to enable efficient implementation in practice. No doubts I have, that this will be the case. At the end of my address, on behalf of all the stakeholders, I would like to express sincere gratitude to INFE-OECD and EFSE for their support all these years. It is unquestionable that many of the activities we have taken so far would have been difficult to carry out without their support. I truly hope that we justify the trust given to us. The mission that we have is important, as by supporting financial literacy, we support provision of public good. In doing so, we must not forget that “Financial literacy is not an end in itself, but a step-by-step process. It begins in childhood and continues throughout a person’s life all the way to retirement” – George Karl. Therefore, we must be consistent, inclusive, committed and patient while playing our role in the financial education of our society. I wish you a successful and fruitful meeting. Thank you. 3/3  BIS central bankers' speeches
Chart: Today’s topics To shed light on these questions I will look at what actually characterises the role of banks, how competition from new participants might influence the financial system and finally the implications of the changes underway for Norges Bank’s role and responsibilities. 1/7  BIS central bankers' speeches  The role of banks in the financial system The financial system should deliver a number of very basic services. We want to be able to borrow in order to study or buy a home today, while paying out of future income. We also want to be able to borrow long-term to finance investment projects with high expected returns. In addition, we need a means of payment that provides fast, safe and reasonably priced settlement services for both domestic and cross-border transactions. The means of payment should also be a savings vehicle. A pre-condition is that we have confidence in the current and future value of money. In today’s system, banks have a key role in providing these services. They offer credit, savings products and payment services. Chart: Banks provide credit Banks are often described as agents that provide credit by taking deposits from savers and lending part of that money to borrowers. This description of banks is not entirely wrong, but overlooks an essential component of banking and a function that distinguishes banks from nonfinancial firms. Chart: Banks create money The description does not explain where the deposits originate. The deposit placed in one bank can come from another bank.

Dominant academic paradigm may restrict those who radically incorporate lessons of these days into their studies. And of course, central banks, as always, will be criticized for spoiling the party at its hottest moment by taking away the punch bowl. We should be aware that keeping the old habits will only give us a new and may be more severe crisis in the near future. Thanks to the global efforts, lessons derived from the crisis have already started to initiate dramatic changes in the global financial governance. There have been encouraging developments in recent months to design a new global financial system to prevent future crises. In the recent meeting of G-20 finance ministers and central bank governors, member  BIS Review 120/2009  1  countries confirmed their commitments to the principles of strengthening transparency and accountability, enhancing sound regulation, promoting integrity in financial markets, and reinforcing international cooperation. I believe the establishment of Financial Stability Board with increased participation of emerging countries is a critical step in achieving these objectives. In recent years, as a byproduct of market-oriented structural reforms and prudent macroeconomic policies, the share of emerging countries in world output and their role in global financial markets has significantly increased. Now, we are faced with a more diversified group of countries with different objectives and interests. Since the rise of emerging economies has dispersed economic power, decision-making process and international cooperation has become more complicated.
A high level of activity and a tight labour market could imply a tighter economic policy. At the same time, there were increasing demands to use a larger portion of the substantial and rising petroleum revenues that were manifested through the Government Petroleum Fund. The guidelines for fiscal policy had so far been that the budget should have an approximately neutral effect on the economy in a normal cyclical situation. A shift towards an increased use of petroleum revenues would then inevitably involve a fiscal policy that no longer had a neutral impact, but which would generally have an expansionary effect on the economy. In such a situation, it will be highly desirable to establish mechanisms that prevent serious imbalances in the economy. The phasing in of revenues must take place in a controlled manner and not through abrupt changes, but a counterbalance to the generally expansionary fiscal policy must also be established in order to avoid galloping inflation, unstable exchange rates and boom periods. The necessary structural changes in the Norwegian economy which an increased use of petroleum revenues implies must take place within a framework of nominal stability. The guidelines, as set out in Report no. 29 to the Storting (2000-2001), provide the response to the first challenge: “Considerable emphasis must be placed on stabilising fluctuations in the economy with a view to ensuring appropriate capacity utilisation and low unemployment.

A gradual phasing in of petroleum revenues is clearly preferable to large and, to some extent, unpredictable changes in fiscal policy from one year to the next. Without clear limits for the use of petroleum revenues, considerable uncertainty concerning the formulation of economic policy ahead could arise. For monetary policy, the guidelines are not a challenge but a benefit. When the implications of the guidelines for Norway’s industry structure become apparent, it is not given that everyone will be equally enthusiastic. If, at the same time, we have a strong exchange rate, some may want monetary policy to counter a strong krone exchange rate even if we are on track in relation to the inflation target. Monetary policy cannot and shall not do this. The objective of monetary policy is to contribute to low and stable inflation. Reducing interest rates in order to weaken the krone, thereby jeopardising the inflation target, would mean that we are not doing our job. Nor would this change the necessary structural adjustments that the increased use of petroleum revenues implies, but only increase their costs. Thank you for your attention. BIS Review 7/2002  11
These criteria, related to each step of the process, should be implemented in a strict and effective manner, in order to provide the countries concerned with the external constraints necessary to bring their economies into line with the respective standards and the final goal of EMU, while also avoiding any discrimination. Against the background of different starting points and possibly different lead-times for progress towards real and nominal convergence, a plurality of approaches should be feasible without compromising equality of treatment. This may apply, in particular, to the timing of the individual steps towards accession. In accordance with the Treaty establishing the European Community, the Eurosystem will always focus on the maintenance of price stability in the euro area. Hence, our involvement in the accession process, including our technical assistance, and any arrangement or other forms of cooperation with accession countries, must be without prejudice to the Eurosystem’s independence and its primary objective. BIS Review 116/1999  4  Over time, the Eurosystem – like other EU institutions – will face the necessity of institutional adjustments required by enlargement. These adjustments should preserve the efficient functioning of the Eurosystem and its ability to maintain price stability in an enlarged euro area. In the case of previous enlargements, the entry of new Member States often brought about so-called “arithmetical adjustments” to the composition of EU institutions. However, an enlargement by as many as 12 new countries may require more substantial adjustments.

Mr Noyer focuses on the challenges in Europe as seen from the point of view of the European Central Bank  Speech by Mr Christian Noyer, Vice-President of the European Central Bank, at the University of Antwerp on 26 October 1999. *  *  *  Introduction First of all, I should like to thank the organisers of the Kekulé Cyclus for inviting me to participate in such an interdisciplinary conference bringing together experts from different professional backgrounds. I will contribute to your discussions by focusing on the challenges we are facing in Europe, as seen from the point of view of the European Central Bank (ECB). Let me briefly recall that it was just a little over a year ago that the ECB was established and that for almost ten months now the Eurosystem – which consists of the ECB and the eleven national central banks of the Member States which have adopted the euro – has been responsible for monetary policy in the euro area. The introduction of the euro has been a historic event for the countries concerned, since it is the first time in monetary history that sovereign states have replaced their national currencies with a common currency and transferred their monetary policy competencies to a newly established supranational institution. The new monetary policy regime in the European Union (EU) is not only an important further step in European integration. It will also have far-reaching implications for the world economy and the international monetary system.
It is actually fairer to focus on forecast errors as deviations from targets under a flexible inflation targeting regime may be deliberate on the part of the central bank. Evaluating the central bank's forecasts is thus important; that is investigating whether the forecasts systematically over- or underestimate outcomes and so on. It is also interesting to compare forecast errors for inflation, for the real economy – irrespective of the measure of resource utilisation used – and for the interest rate if the central bank publishes such a  9  10  The output gap in the figures is the output gap in real time. As the output gap is revised backwards when new data is published, the gap in the figures does not correspond to the gap published in, for instance, the Monetary Policy Reports. (10) A preliminary analysis is carried out in Svensson, Lars E. O. (2009), "Transparency under Flexible Inflation Targeting: Experiences and Challenges", www.larseosvensson.net. BIS Review 29/2009  forecast. Which forecast errors are most relevant for explaining why monetary policy, with the benefit of hindsight, could have been better? What were these forecast errors due to? A disadvantage of an ex post evaluation is that we have to wait at least a couple of years for the outcomes for inflation and the real economy for the full impact of the monetary policy measures to become apparent.

In 2017, the TCFD published its recommendations in terms of reporting. These guidelines take into account the double materiality of climate matters: both the information on the exposure of the company to climate change, and the information on the impact of the company on climate must be considered significant. Nonetheless, more progress is necessary concerning climate disclosure. A first step is the shift from ‘voluntary’ to ‘mandatory’ reporting. On June 7, G7 nations came to an agreement to make climate-reporting mandatory in line with TCFD recommendations. Mandatory requirements have been enforced in the EU since 2014, and will be extended to a larger set of corporates when the Corporate sustainability reporting directive (CSRD) will enter into force (expected to apply as of October 2022). It will also be completed by the development of a comprehensive set of EU sustainability reporting standards. The first set of standards would be adopted by October 2022. We expect that the international standards to be developed by the International Sustainability Standards Board (ISSB) will ensure interoperability with regional standards and offer common building blocks across jurisdictions and sectors. ***** Let me conclude in highlighting that we are just at the starting point of what we can do with and what we draw from those scenario analyses. Further collective work is needed to improve them. I have no doubt that we will succeed in doing so. Financial institutions need to step up their  effort to combat climate changes.
But the confidence crisis that followed in the wake of Lehman filing for bankruptcy protection also affected the Swedish financial system. To counteract the effects of the financial crisis, the Riksbank has supplied the market with loans in kronor and US dollars in a similar manner to what other central banks have done in their currency areas. The loan facilities have allowed a different class of collateral than usual. The maturities have been longer than those the market has been able to offer and longer than the Riksbank normally provides. In total, the Riksbank has increased its lending by more than SEK 400 billion. We will continue to provide the market with liquidity as long and as far as it is needed. During the autumn the Riksbank has received signals from Swedish industrial and trade companies that they have been unable to find satisfactory credit. Quite simply, they have not been able to borrow on the market or from the banks in the same way as usual. This problem originates outside of Sweden and has arisen despite the Swedish banks being financially strong. As a preventive measure, the Riksbank established a new, temporary, credit facility on 29 October. The aim is to improve the opportunities for companies to borrow money. Companies can organise their financing through this facility by issuing and selling commercial paper to the banks. The banks can in turn use commercial paper as collateral for loans from the Riksbank.

Putting all of the responsibility on monetary policy would probably mean such high interest rates that they would have seriously negative repercussions for the real economy. Moreover, the argument remains that it is difficult to determine when a credit boom changes from being beneficial for growth to becoming a risk that can trigger a financial crisis. I nevertheless think that the crisis has taught us that when we conduct monetary policy we must also follow a number of variables that are linked to the build-up of risk in the financial markets, primarily credit growth in different sectors of the economy. The fact that monetary policy alone cannot prevent financial crises does not mean that we can only look at an inflation target and otherwise disregard what a long period of low interest rates may entail with regard to risks in the financial system. This is also the view the Riksbank has expressed  BIS Review 149/2008  5  in recent years, occasionally, one must say under strong criticism from both academics and various other parties in society. Monetary policy can alleviate the consequences of the financial crisis The financial crisis has meant that the focus normally placed on monetary policy has been transferred to the measures taken to safeguard financial stability. Monetary policy cannot be used to resolve acute problems in the financial markets. This requires a different type of measure, as I have already described. What role can monetary policy then play in the current situation?