samchain/econo-pairs-v1 huggingface dataset:
I look forward to seeing you, fellow INEDs, this time next year at the 2nd Annual INED Conference. 2/2  BIS central bankers' speeches

Moreover the type of deals has broadened out to include a wide range of asset classes. For example, this month’s deals included credit card, auto loan and lease, equipment leasing, insurance premium and mortgage servicer securitizations. Second, the market for such deals is not wholly reliant on TALF financing. TALF loans have accounted for a bit more than half of total issuance volume of ABS, with considerable variability from subscription to subscription period. We view this as a good thing. This means that the TALF is helping to restart the market, rather than the TALF being the market. Third, and most importantly, spreads on consumer ABS have been coming down sharply from their peak levels reached late last year. For example, the spreads on AAA-rated credit card ABS have narrowed from a peak of about 600 basis points over LIBOR to slightly above 200 basis points currently. Encouragingly, spreads of even lower-rated ABS – securities that are not TALF eligible – have also narrowed quite significantly. Although it is still too early to say the TALF has been a resounding success, we at the Fed are encouraged by the results so far. While we are generally pleased with how the TALF program has been evolving, many challenges remain. One challenge is in striking the appropriate balance between sufficient protections against abuse of the program, on the one hand, and a degree of red tape and restrictions that could make the program unattractive to issuers and investors, on the other.
This agreement has reaffirmed the commitment to monetary union, patent both in the supportive efforts of its members and in the observance of the common stability rules governing the functioning of the Monetary Union. The negotiations for the Third Bailout Programme for Greece unfolded as scheduled, and there is every indication the Programme will be launched immediately and that the day after tomorrow, on 20 August, the Greek authorities will be able to meet their ECB payments, thereby avoiding a default with dire consequences. This third bailout is, perhaps, the most complex and demanding of those so far agreed between Greece and the European authorities and the IMF. This is so, among other things, because it will include measures to reinforce the Greek banking system, which has been greatly affected by events in recent months. Evidently, it is in the interest of all euro area members that the new Programme should be properly adhered to, and follow schedule, so that assessments of its implementation before year-end may be positive and provide for its full effectiveness and continuity. Needless to say, the fulfilment of this third programme will boost the growth of the Greek economy – the central and fundamental objective of this third assistance programme – and will strengthen the euro area and its stability as a whole. Recent developments on the international economic front are positive in terms of growth.

While growth in both the Asian and Latin American emerging economies remains below par, the latest indicators show that the United States and the United Kingdom appear to have picked up speed, following the weak first-quarter results this year. Economic recovery is also holding up in the euro area. GDP grew by 0.4% in the first quarter of this year and, on the latest preliminary estimate released last Friday, by 0.3% in the second quarter. For the year as a whole, projections envisage figures of around 1.5%, considerably up on end-2014 estimates. Private consumption continues to be the driving force here, while the contribution of private investment remains moderate. BIS central bankers’ speeches  1  Turning to inflation, both actual and projected euro area rates have now turned around from the declining trajectory marking their path throughout 2014, but inflation is still some way off the ECB’s reference level of 2% for the euro area. The favourable performance of euro area economic activity and prices is underpinned by certain external factors, such as the pick-up in the global economy and lower oil prices, but also by other factors whose origin lies in the economic policy decisions adopted by the national governments and the European authorities. These include most notably the reforms undertaken in different countries and the more neutral stance of fiscal policies.
These real rates, which correspond to nominal interest rates less inflation expectations, reflect the actual financing conditions of economic participants; they are the result of monetary policy decisions but are also driven by the inflation expectations channel. The current increase in nominal interest rates, combined with inflation expectations that are more anchored towards the target of 2%, has led real interest rates in the economy to increase substantially and move back into positive territory, in accordance with our goals. In conclusion, allow me to stress that, barring a major new external shock, the monetary policy implemented by the Eurosystem should enable us to win the fight against inflation while avoiding a recession in France and in the wider euro area. Economic growth held up extremely well in 2022, at 2.6% in France and 3.5% in the euro area. A highlight of 2023 will be France's resilient economy, which is expected to expand by 0.6% according to our macroeconomic projections. With disinflation, growth is poised to reach 1.2% in 2024 and 1.7% in 2025. The economy’s resilience will be all the stronger and more sustainable because, in every part of the country, economic participants and households are working to execute a comprehensive transformation strategy that will enable our societies to successfully navigate the energy, climate and digital transitions. Thank you for your attention. 7

As you may have guessed though, the main reason for central bank transparency is not to make your weekends more relaxing. Central bankers today pursue a policy of broad information because we believe that transparency helps us fulfil our mandate. We are convinced that monetary policy is most effective and least disruptive if it is predictable: no news on monetary policy is good news. In the following, I would like to discuss why, today, central bankers think transparency is crucial for a successful monetary policy and how the Swiss National Bank attempts to achieve transparency in practice. I shall then debate the limitations of what transparency Finally, I would like to reflect upon how transparency in monetary policy may affect the relationship between you, the journalists, and us, the central bankers. 1. The case for transparency  At the Swiss National Bank we see three main reasons to be transparent about our monetary policy. The first reason is that we count on transparency to enhance the effectiveness of our monetary policy. In the public eye, central banks may be viewed as almighty. The plain reality is, however, that our open market operations only have a direct influence on current short-term interest rates. Economic activity and thus future price developments are, however, determined primarily by the shape of the yield curve, i.e. by the expectation of future monetary actions. Transparency about how we judge future inflationary pressures enables us to guide expectations about future short-term interest rates and thus also long-term interest rates.
The first of these measures consists of a permanent increase in the risk-weighting11 for the loan tranche exceeding the 80% loan-to-value ratio. The second  9  Taxonomy as proposed in De Nicolò et al (2012). For an overview on macroprudential instruments and international experiences, cf. CGFS (2010). 10  Over the past three years, annual real growth amounts to, on average, 4.4% (houses) and 5.5% (apartments). Annual real mortgage growth over the past three years amounts to, on average, 4.8%. 11  The risk-weighting is increased from 75% to 100%. 4  BIS central bankers’ speeches  measure requires a 100% risk-weighting for new mortgage loans which do not meet tighter minimum requirements stipulated in the banks’ revised self-regulation guidelines.12 The CCB, for its part, is a pre-emptive measure that allows authorities to temporarily raise capital requirements in the banking system as imbalances in the credit market develop. When activated, banks will be required to gradually build up an additional capital buffer of up to 2.5% of total domestic risk-weighted assets during the upswing in the credit cycle. The CCB requirement is a supplement to other capital requirements. Once risks have materialised, or if the intensity of risk is subsiding, the capital buffer generated from the CCB is released, either immediately or gradually. The key features of the CCB The CCB combines several key features that directly address the problem of cyclical risks to financial stability. In particular, when activated, the CCB should help reduce the amplitude and the consequences of imbalances for financial stability.

This internal consistency explains why monetary policy is the only part of the EMU framework that has clearly functioned as designed. Fiscal policies were supposed to conform to the other form of governance, where countries would decide on and execute their own budgets, but within the strict constraints of the deficit and debt limits set in the Treaty. Those limits were supposed to be policed by markets, the Commission and other Member States, but in practice the incentives of the latter to enforce the rules were weak. This meant that de facto rules could be applied with discretion, while Member States themselves decided on how to exercise that discretion – in other words, the worst combination of the two forms. The result was that fiscal positions diverged significantly, which then created substantial spillovers for other euro area members. But perhaps more fundamentally, internal inconsistency meant that fiscal policy itself became ineffective in several jurisdictions. A number of governments either did not have the fiscal space to absorb the shock they faced in the early stage of the crisis, or they were unable to maintain the trust of the market when investors finally reacted – and over-reacted. Fiscal policy therefore had to effectively give up its stabilisation function – which is vital with a single monetary policy – and switch to convincing investors of debt sustainability. Prudential policies were also supposed to fit the decentralised model, although here the framework was even looser.
However, the recommendation that a capital component of a countercyclical nature be introduced raises a number of questions. What does seem interesting, although it is not explicitly included in the recent Basel proposal, is the idea of having some component of contingent capital. This could be established by issuing bonds that would, under certain circumstances or conditions, become capital as, for example, if an institution’s capital falls below 8% of its risk-weighted assets. Another point on which there is a considerable agreement is the need to review norms and practices on liquidity management and bank funding. These had become quite lax in many jurisdictions. Liquidity and refinancing risks were underestimated, particularly in the environment that preceded the crisis. The recommendations that have subsequently been put forward include a redefinition of liquid assets, the establishment of a minimum global liquidity standard, norms using time bands for the match of assets and liabilities, and higher requirements for liabilities that show greater volatility. In all these cases, there is much that central banks can contribute. The Basel Committee has recently undertaken to advance in defining a global liquidity standard and has fixed a calendar for this process. A robust system of provisions, based on a forward-looking rather than a backward-looking approach, can make a significant difference to the stability of the banking system. This is illustrated by the experience of emerging economies where this policy instrument is used most often and with the greatest intensity.

In terms of analysis by socio-demographic groups, the survey results show that the monetary value in “old lek” is more frequently used by: (i) males; (ii) old-aged people; (iii) persons with a low-education level; (iv) unemployed persons in labour market; and (v) individuals with a low level of family income. These groups identified in the survey will be the focus in the projects of this awareness campaign for bringing to an end the use of the wrong term “old lek”. Against this backdrop, the Bank of Albania is launching this awareness campaign, which will extend in time and will aim at being a comprehensive one, affecting various groups of interest. In a medium-term period, and through various channels, we aim at knocking at the doors of every Albanian to uproot the terms “new” or “old”, by avoiding the confusion in the communication of prices and enhancing the correct reading of economic and financial indicators. Lek is the national currency in Albania, and the face value of each coin or banknote is the one written on it. Nevertheless, the fact that this incorrect use is inherited in the day-to-day speaking and has been resistant for more than 55 years, illustrates that the sporadic and isolated efforts of a solely institution to rectify this phenomenon are insufficient. A joint and coordinated commitment among central institutions of the country, media and other relevant actors is crucial in this regard.
Consequently, we do not think that aligning the regulatory framework to banks’ contemporary risk measurement techniques will make lending patterns more volatile. Nor do we think that it will harm competition or dry up capital flows into emerging market countries. The Committee has worked to ensure that the new framework contains sufficient options and simpler forms of rules so that its basic principles can be applied to many kinds of banking organisations in many countries. Basel II presents an excellent opportunity for emerging and developing markets. By stimulating banks to upgrade and improve their systems, business models, capital strategies, risk management systems and disclosure standards, Basel II should improve their overall efficiency and ability to compete globally. It will help to reduce the risk premiums of emerging and developing markets and will help to ensure the stability of the financial system. Still, it is clear that, to accomplish all of these intentions, the new capital framework will be a very different approach to supervision than what we have known so far. It will require hard work on all of our parts. Bankers must work to ensure that their risk management systems meet the standards to qualify to use the more sophisticated measures of risk. For our part, supervisors must ensure that we are comfortable with banks’ progress. But we must also be ready to supervise a more comprehensive capital framework. We will need to share information on the issues we encounter in moving from the 1988 Accord to the three pillars of the new framework.

This would spur hedge funds to disclose more or to obtain a credit rating. Global financial supervision The crisis has set off debate as to whether the global capital market needs a global regulator. I doubt this is workable, or even desirable. A global financial super-regulator requires countries to give up national sovereignty. This is politically unrealistic; witness how carefully the IMF had needed to 2  George Soros in The Crisis of Global Capitalism, Ch. 7 The Global Financial Crisis, p. 136. 5  BIS Review 93/1999  canvas its major shareholders to support its prescriptions and how closely the US Congress scrutinises the IMF’s actions. A more practical, albeit modest, solution is the establishment of the Financial Stability Forum. This brings together both the G7 countries as well as non-G7 financial centres and international organisations such as the IMF, World Bank and the BIS to discuss the vulnerabilities of the world system. The Forum should be able to get best practices and supervisory standards implemented more widely and effectively. The FSF has set up three working groups to study areas of vulnerability highlighted by the crisis: capital flows and exchange rate regimes, highly leveraged institutions and offshore financial centres (OFC). Singapore has been invited to participate in the FSF, together with Australia, Hong Kong and the Netherlands. We are also in the OFC working group. OFCs have attracted considerable attention because of the significant capital flows they generate.
These institutions have better information on their own economies, greater resources for analysis and investigation and, above all, better information regarding their own plans. In my opinion, one must have strong and clear reasons for arriving at another conclusion than that stated and signalled by these central banks themselves. The statements and signals from the Federal Reserve are hardly compatible with a forecast that they will begin raising their policy rate in 2011. Here I refer for instance to Ben Bernanke’s recent speech (2010) and to the most recent decision by the FOMC on a new round of Quantitative Easing (QE2), which means that the Federal Reserve will buy government bonds regularly up to summer 2011 for the purpose of lowering long-term interest rates in the United States. As regards the ECB, in my opinion the best information and signals are those presented in the ECB Staff Forecast (2010) at the beginning of September. The forecast is based on an assumption that the Eonia interest rate, the overnight rate in the eurozone, will follow market expectations. The forecast shows that inflation will be below the ECB’s target of “below, but close to, 2 per cent” and that the real economy will be weak. If anything, it indicates that the ECB will follow a policy rate path that is lower than market expectations.

If we assume that equilibrium unemployment is as high as 6.5 per cent in Sweden, the unemployment gap is about the same as in the eurozone and the United Kingdom. These level figures showing GDP and unemployment undoubtedly provide a more nuanced picture of the Swedish economy and the level of resource utilisation than merely looking at GDP growth. Given these figures, we can wonder what justification there is for tightening monetary policy in Sweden when the central banks in the other three countries are still conducting very expansionary policies. In the United States, Federal Reserve Chairman Ben Bernanke (2010) recently held a muchpublicised speech, in which he observed that the forecast for inflation was too low and the forecast for unemployment too high, in relation to the levels compatible with the Federal Reserve’s mandate. He therefore drew the following conclusion: “given the Committee’s  5  In Figure 2 the unemployment gap, which is the difference between the unemployment rate and equilibrium unemployment rate, is used to measure resource utilisation. I consider the unemployment gap to be a more robust, transparent and less easily manipulated indicator of resource utilisation than the alternatives. Moreover, until new and better estimates are made, I consider equilibrium unemployment to be around 5.5 per cent. I gave more detailed motives for this at the most recent monetary policy meeting (Sveriges Riksbank 2010c). It is also easy to do sensitivity analysis with different assumptions about the equilibrium unemployment rate.
As banking systems around the globe implement fully the new framework, a system that was built precariously on sand will stand more firmly on rock. The system is simpler. Before the crisis, risks were hidden and financing chains were fiendishly complex. Banks were complacent, building business models on the belief that “this time is different” and assuming markets would be continuous and deep. They were enthralled by models to the extent that every bank that failed or was rescued by the state reported on the eve of their collapse that it substantially exceeded the Basel riskweighted capital requirements. Now, disclosure standards have been significantly improved, contingent exposures are on the balance sheet, essential wholesale markets are more reliable, and capital standards are more robust. The system is fairer. Banks were in receipt of large public subsidies. In Brisbane we reached a watershed in ending too big to fail, with agreements to take forward proposals on total loss absorbing capacity for globally systemic banks. Globally systemic banks that fail will in future be resolved without recourse to the taxpayer and without jeopardising financial stability. Does that mean the job of financial reform is complete? No. Implementation must follow agreement. Our perspective cannot be only to look back. Just avoiding the repeat of past failures is not a recipe for success. Agreeing to measures to fix the fault lines is necessary and important, but not sufficient.

(While these tendencies show progress, in Britain statistics reveal a decrease in the volume of transactions via cards, due to electronic transactions via mobile phone or other means.) The increasing use of electronic services such as home banking is a considerable development. Thus, in the last years, these services were more used and the users’ spectrum expanded, including not only businesses, which where the target group at the start of supplying this service, but also by individuals. At the end of 2014, the number of accounts accessible via internet stood at 145211, from 27368 at the end of 2010, followed by fourfold increase of such transactions conducted via these accounts. The encouragement of the use of payment instruments is reflected in the increase of activity of settlement and clearing systems operated by the Bank of Albania. In 2014, the activity of the Albanian Interbank Payment System (AIPS) grew by about 1.5 times, compared to the beginning of operations of this system in 2004. Also, the Albanian Electronic Clearing House System (AECH) shows a considerable increase. The value of transactions cleared in this system, during 2014, was 10 times higher than the value of transactions cleared in 2005, when this system started to operate. The measures taken by the Bank of Albania in March 2011 contributed to the use of the clearing and settlement systems. The measures consisted in the reduction of commissions applied to the users for transactions in the Albanian lek.