samchain/econo-pairs-v1 huggingface dataset:
The banks make payments between themselves via the central bank and they can borrow or deposit money there for the short run. The terms determined by the central banks for these transactions affect interest rate-setting and credit flows in the economy. This is what is normally referred to as “monetary policy” and receives considerable media coverage and space in the economic policy debate. Since the monetary policy regime of maintaining a fixed foreign exchange rate was abandoned at the beginning of the 1990s, the Riksbank – similar to many other central banks – has followed a strategy known as “flexible inflation-targeting”. This means that monetary policy is aimed at achieving a quantified inflation target, but this is done in a flexible manner. Deviations from the target are consciously accepted, normally in order to avoid unnecessarily negative effects on output and employment, but it could also be a matter of trying to avoid the build-up of financial imbalances. 19 Flexible inflation targeting can help to maintain financial stability. At the same time, financial stability is a prerequisite for being able to pursue a meaningful monetary policy, as monetary policy affects the real economy and inflation via the financial system. Financial instability very much inhibits effective monetary policy. Many would certainly agree that our flexible inflation targeting policy has led to favourable economic growth in Sweden. It has also in general received a good rating in the evaluations of the Riksbank performed by external experts on behalf of the Riksdag.

Improvements are urgently needed here so that we can tackle risks in good time and such procedures have also been recommended by the EU’s macroprudential policy body, the European Systemic Risk Board (ESRB). 16 Secondly, the Swedish structure falls short also when it comes to clarity in the division of responsibilities. Via its instruction, Finansinspektionen was given the responsibility to “take measures to counteract financial imbalances with the aim of stabilising the credit market”. No definition of what Finansinspektionen’s overall macroprudential policy task comprises has been formulated, however. This problem is highlighted by the decision process for the upcoming amortisation requirement. The Government has indeed tasked Finansinspektionen to produce regulations that more closely define the amortisation requirement but at the same time requires these regulations to be approved by the Government before Finansinspektionen adopts them. This is not in line with the ESRB’s recommendation that the macroprudential authority should as a minimum be operationally independent from political bodies. 17 The importance of independence when adopting macroprudential policy measures is also underscored by Goodfriend and King. This is, if anything, a return to the arrangement that often prevailed prior to the deregulations of the 1980s. A third problem with the Swedish macroprudential policy framework is that it has not been established by law. Finansinspektionen’s mandate in the macroprudential policy area is only a government ordinance and the Stability Council is formally only a committee.
When the banks’ foreign currency borrowing was not particularly great, this was not a significant problem. However, the growth in borrowing and our experiences from the crisis give us reason to think again. Today, it seems reasonable for the banks to carry the cost of the Riksbank’s foreign currency reserve, in as much as it is needed to meet their liquidity requirements in the event of a crisis. If they were to carry the cost of maintaining a liquidity buffer in the Riksbank, it is likely that the banks would find it profitable to cut back on the riskier areas of their dollar lending. In this case, the Riksbank would also reduce its foreign currency reserve, as the need for a buffer would have decreased. However, the banks should pay a charge to cover the costs of the remaining buffer. The extent to which the banks could imagine reducing the riskier areas of their foreign currency lending, the size of any charge, and how this could be repaid remain to be discussed by the Riksbank and the banks. The rough calculation I made earlier could form a starting point, but I make no claims for it to be any more than that. However, it is essential that this question receives an answer. The present situation is unacceptable in the long run. BIS central bankers’ speeches  11

Andréa M Maechler: Monetary policy in 2015 – a first assessment Speech by Ms Andréa M Maechler, Member of the Governing Board of the Swiss National Bank, at the Money Market Event, Geneva, 19 November 2015. *  *  *  Accompanying slides can be found at the end of the speech and on the Swiss National Bank’s website. The speaker would like to thank Dirk Faltin, Marco Huwiler and Bettina Simioni for their valuable support in preparing this speech. She is also grateful to Vincent Crettol and Peter Kuster for helpful comments and SNB Language Services for their assistance. Ladies and gentlemen It is my great pleasure to welcome you tonight to our traditional Money Market Event. I feel very honoured to be here in Geneva, the city of my birth, giving my first public speech for the Swiss National Bank (SNB), having joined the Governing Board in July this year. It has been a very eventful year for monetary policy in Switzerland. In January, the SNB took two momentous decisions: It discontinued the minimum exchange rate against the euro, and lowered the interest rate on sight deposits further into negative territory. Thus, the SNB’s monetary policy has changed significantly. Tonight, I shall provide a first assessment of this new monetary policy environment. My speech is divided into three parts. First, I shall discuss the SNB’s monetary policy since the discontinuation of the minimum exchange rate, and the impact on the Swiss franc exchange rate.
This is because the transmission of monetary policy decisions to the economy takes place with relatively long lags. Estimates of these lags between interest rate changes and their effects on inflation vary between one and two years. As a consequence, central banks have to look ahead before they take monetary policy decisions. A case in point was the recent decision by several continental central banks, including the Banque de France, to raise their main refinancing rates on 9th October. This move was justified by the need to pre-empt inflationary pressures early enough, although current inflation remained low. In my view it is very important to make the public aware of the concept of the “pre-emptive strike”, which is at the heart of central banking. 1.2. Intermediate target: more arguments in favour of monetary targeting, with a caveat In order to provide an anchor to inflation expectations and to look ahead, central banks make public an intermediate target which they commit themselves to respecting. Announcing an intermediate target also enhances the accountability of the central bank. This is why Article 12 of the Statute of the ECB explicitly refers to decisions relating to intermediate monetary objectives as one of the main responsibilities of the Governing Council of the ECB.

Mr. Hannoun discusses the operational framework for EMU and the challenge of managing price stability Speech by the Deputy Governor of the Banque de France, Mr. Hervé Hannoun, at the Financial Times European Economic and Monetary Union Conference in London on 20/11/97. I am delighted to take part in this discussion on the framework for the single monetary policy in Stage Three. I will address what I consider to be the two main categories of issues in this context: those related to monetary policy strategy on the one hand, and those related to the execution of monetary policy operations on the other hand; in other words, strategic and operational issues. 1. STRATEGIC ISSUES What are the main strategic issues relating to the formulation of the single monetary policy? I will consider in turn: •  the final objective,  •  the intermediate target,  •  the role of the exchange rate as an indicator, and  •  the starting level of interest rates in the euro area at the end of next year. 1.1. Final objective: a quantified definition of price stability The final objective of the single monetary policy is clearly stated in the Maastricht Treaty: according to article 105, “the primary objective of the ESCB shall be to maintain price stability”. Only a monetary policy geared towards the objective of price stability can create the conditions for durable and sustainable growth.
For this reason, too, we will have to rehabilitate the quantities – money, credit, debt – and estimate the effects of changes in them in the longer run. Furthermore, we must introduce into our monetary policy frameworks ways of systematically identifying and reflecting structural changes related to the functioning of the labour market under the influence of demographic change, to globalisation or deglobalisation tendencies, to society's preferences regarding private and public debt, to the response of economic policy to climate risks, and so on. To this end, we also need to begin to view macroeconomics as a social science again, that is, not to be ashamed of the historical term "political economy". I would like to end by thanking all my current or previous colleagues here at the Faculty of Economics, at universities in other countries, in international organisations and at the CNB for carrying on the torch of the Ostrava Monetary School which we started to build here in the early 1990s. I wish you a successful conference. *** I would like to thank Jakub Matj, Adviser to the Bank Board of the Czech National Bank, for valuable comments and suggestions. Any errors or omissions are my responsibility. 5/5  BIS - Central bankers' speeches

•  And we do not know yet how to exit successfully from these policies. Can monetary policy contribute towards financial stability? And there is a further problem. Macroprudential policies may not be equally effective in all countries – which brings us back to the United States. •  As Stanley Fischer put it recently: “The US macroprudential toolkit is not large and not yet battle tested.”  •  There is a significant shadow banking sector in the US that extends credit but is not regulated like banks. •  This will blunt the effectiveness of any macroprudential tools applied to regulated entities. If macroprudential policy is not able to secure financial stability on its own, could monetary policy lend a helping hand? •  As Stan Fischer goes on to say: “The limited macroprudential toolkit in the United States leads me to conclude that there may be times when adjustments in monetary policy should be discussed as a means to curb risks to financial stability.”  6  BIS central bankers’ speeches  The question then arises: under what circumstances should monetary policy consider financial stability? •  One way to look at it could be as follows. •  If the market interest rate is clearly below reasonable estimates of the neutral rate, there could be a case for monetary policy to step in on both price stability and financial stability objectives. Can regulatory policy help contribute towards macroeconomic stability?
This means that there is still a distinct public interest in the activities of institutions that are engaged in banking - as defined - whether as free-standing entities or within a broader group structure. That interest includes a micro-prudential concern to provide some measure at least of protection to public depositors, reflected in the supervision of individual banking institutions and in deposit protection schemes. But it includes also a macro-prudential concern with the stability of the banking system as a whole, because of its peculiar vulnerability to contagious - systemic - disturbance, reflected in central banks’ preparedness to provide liquidity to the system where that is judged to be necessary. Other forms of financial activity also perform distinctive functions, and have distinctive characteristics which make them special in their own different ways. And these special features equally may - and often do - give rise to special public interests. The public interest in these other financial activities may be driven by a social concern to protect consumers (for example the prospective beneficiaries of pension funds or life insurance policy holders, or investors, whether in collective funds or individually, through different kinds of intermediary, in capital markets), which is similar to the social concern relating to depositor protection. And it may extend to other aspects of the particular activity, including aspects of business conduct as well as the financial integrity of the institutions involved.

Illiquid assets continue to be a small proportion of the total, generally of the order of 2%, and the houses mitigate the maturity transformation risk in holding these, and marketable assets of more doubtful liquidity (such as some emerging market instruments), by matching with long-term borrowings. What is certainly true is that the securities houses have expanded their activities enormously - with balance sheets extending to $ billion, which puts them in this respect on a par with large international banks. And, given their focus on trading activity - in money, capital and foreign exchange markets - they are, of course, huge counterparties of the banks, with very large exposures both among themselves and between them and the banks, but with the important distinction that exposures between, or to, securities houses are more typically secured. Size in any event does not in itself mean that the securities houses now have the special, distinguishing, characteristics of banks - any more than the long-term savings institutions or the money funds or indeed large non-financial corporates, which may also have huge balance sheets and which may also have large Treasury operations in-house to manage the funds for own account. Systemic risk So it seems to me that banks are indeed still special insofar as they continue to perform distinctive economic functions and insofar as their liabilities and assets still have distinctive characteristics.
The head and the staff should be protected against frivolous law suits, as long as they conduct supervision in good faith. Traditionally, independence has been best protected when supervision is conducted in an NCB since the NCB itself is independent due to its role in monetary policy. The NCB also has its own revenues and budget. Outside the NCB, independence must be ensured through explicit legislation and through clear rules for obtaining the necessary resources, e.g. by levying fees on the supervised entities. Contrary to supervision located in the central banks, the supervisory sections which are entities of Ministries are by definition not operationally independent and their resources are dependent on budget appropriations. The second condition for good supervision is accountability. The authority must regularly provide information about its performance in various forms, such as Parliamentary hearings, speeches by the management, written reports and websites. On these occasions the authority describes and explains its actions and stands ready to receive criticism. There is no specific structure of supervisory authorities that automatically leads to better accountability so clear rules must be set regardless of how the authority is structured. The third condition is transparency. The general public and in particular the supervised entities need to have full information about regulation and supervision. The authority must consult with interested parties to ensure that efficient laws and regulations are drafted and after implementation they should cooperate with the market participants and others to ensure that the rules are well understood and implemented.

Simon Potter: The Foreign Exchange Global Code - lessons learned and next steps Remarks by Mr Simon M Potter, Executive Vice President of the Markets Group of the Federal Reserve Bank of New York, at the 2017 FX Week Conference, New York City, 12 July 2017. * * * I would like to thank Christina Getz and Jamie Pfeifer for their excellent assistance in the preparation of these remarks and colleagues in the global central bank and FX community for numerous insightful comments and suggestions. Good morning. It is a pleasure to return to FX Week USA, and I would like to thank FX Week for the invitation. Foreign exchange (FX) market participants play important roles in their interactions with the New York Fed. They act as FX trading counterparties of the New York Fed and they provide information on market conditions to support the Desk’s monitoring of financial markets and transmission of policy. I am pleased to have the opportunity to speak with you today. Before I begin, I would also like to note that my comments today reflect my own views and not necessarily those of the Federal Reserve Bank of New York or the Federal Reserve System. However, remarks on the expectations for FX counterparties reflect the policies of the Federal Reserve Bank of New York. At this event two years ago, I highlighted the important role the FX market plays in facilitating the flow of capital across the globe in support of international trade and investment.
In 2013, our cash-in-circulation over GDP is 6% compared to only 2% to 4% in advanced countries. In terms of payment card usage, our payment card transaction per capita is relatively low, at only 13 transactions per capita in 2013. This is far below the level of payment card usage in the advanced countries with an average of more than 200 transactions per capita. It is also important to note that Malaysia has a higher proportion of credit card usage compared to debit card usage, with a ratio of 7 credit card transactions for every debit card transaction. In contrast, debit card usage is more prevalent in the advanced economies, at an average of 6 debit card transactions for every credit card transaction. The debit card is a more cost-effective payment instrument compared to the credit card. Greater use of debit cards would minimise the country’s retail payment cost and contribute to greater savings and efficiency. In this respect, the banking industry can play the important role of taking more proactive measures to widen the payment card acceptance infrastructure, and promote actively the usage of debit cards to the general public. It is a mutually beneficial relationship. Consumers can conduct their financial transactions in a safe, convenient and efficient manner while the banking industry can benefit through reduction in the cost of handling and managing cash. High potential for debit cards to displace cash in Malaysia Cash is an expensive payment instrument which imposes an unnecessary cost to the economy.

The challenge is to enhance efficiency and reduce costs, respond to market and regulatory demands and, most of all, gain competitive advantage through innovative products and services. Ladies and Gentlemen, The success of this IBBM-University of Nottingham collaboration will depend on the active involvement and support from the financial services industry. I therefore, encourage the industry to play a proactive role in supporting the activities organized by the Financial Services Research Forum. In concluding, I look forward to seeing greater collaborative efforts between the academia and the industry in research and development for the financial services industry. On this note, I am pleased to officially launch the collaboration between IBBM and the University of Nottingham , in the Financial Services Research Forum. Thank you. 2  BIS Review 63/2006
Today, I intend to discuss my view of monetary policy and explain in more detail why I entered a reservation at the latest monetary policy meeting. Much of the reasoning is the same as when I advocated a lower repo-rate path. 2 The new points that I want to make here today relate to the reasons why I entered a reservation in favour of the extended repo-rate path rather than a lower repo-rate path with a reduced repo rate. Let me begin by presenting my general view of monetary policy. 1  One may ask why the focus should be on the CPIF and not the CPI. In a situation in which significant reporate changes have very large direct effects on the CPI, I consider it to be more appropriate to focus on stabilising the CPIF around the inflation target, instead of the CPI. 2  See also the speech “Why a lower repo rate?” that I made at Umeå University on 24 February this year for a detailed account of that reasoning. BIS Review 60/2010  1  Flexible inflation targeting stabilises both inflation and resource utilisation When discussing what repo-rate path one should choose it is natural to take the Riksbank’s monetary policy objectives as a starting point. The Sveriges Riksbank Act and its preparatory work stipulate that monetary policy focuses on stabilising inflation around the inflation target and resource utilisation around a normal level. This is what is referred to as flexible inflation targeting.

That would afford us better knowledge of the relations between subsidiaries and their parent companies, which are so important for understanding the effects of globalisation. Moreover, the ESCB has contributed to the creation of a worldwide network to set up a global identifier for legal entities, the Legal Entity Identifier (or LEI). In Spain, some institutions, including INE and the Banco de España, are promoting the use of the LEI and facilitating its implementation in our country. I think there is a broad consensus that the widespread use of the LEI among institutions and firms globally would greatly favour the monitoring of financial stability and the compilation of statistics. Globalisation also poses significant challenges for the compilation of macroeconomic statistics, on which our institutions cooperate very closely. Multinational enterprises (MNEs) organise their activity and finances globally and the complexity of allocating them correctly across countries can only be afforded by data-sharing –nationally and internationally- and perhaps even by resorting to centralised data reporting and quality checking. Obtaining information from MNEs as groups would allow reporting to be simplified, while at the same time ensuring a consistent cross-country recording of transactions, assets and liabilities. I have mentioned before how important it is for official statistics to offer a complete and consistent picture of the whole economic situation. In this regard, it is crucial that users know the links between the different products, even when they are produced by different institutions. And this is something which should hold not only for aggregates but also for micro data.