samchain/econo-pairs-v1 huggingface dataset:
The sooner such a comprehensive plan is designed and announced the better, as this would help boost confidence and reduce the uncertainty surrounding Spanish economic policies. Such confidence is particularly important in the context of monetary policy normalisation (with the consequent tightening of financial conditions) in which we find ourselves. This will be the topic of tomorrow’s policy panel discussion. Let me conclude. The economy is currently in a highly uncertain environment characterised by the aftermath of two major shocks, the pandemic and the war in Ukraine, with consequences that are difficult to anticipate, especially in a context of ongoing monetary policy normalisation. This setting interacts with the enormous structural challenges that the Spanish economy faces, highlighting the need for a comprehensive strategy of ambitious and lasting reforms in order to boost growth and promote the well-being of our society. 5  Only a resolute economic policy response to the multiple challenges facing the Spanish economy will enable us to follow a robust and sustained growth path that offers opportunities for all in the coming years. Moreover, it is essential that this response is based on high-quality theoretical and empirical analyses that provide a necessary diagnosis of the situation from different angles as well as a rigorous discussion of the pros and cons of the policies available. This conference will certainly contribute to that goal. The quality and range of the speakers and papers covering these topics will guarantee that this is the case.

Some of these uncertainties are already having a negative impact on the world economy and have the potential to affect significantly growth prospects. As an illustration, a hypothetical interruption of energy commodity imports from Russia would hit the European and Spanish economy hard. Indeed, simulations prepared by Banco de España staff show that such a scenario would have a negative impact of between 0.8% and 1.4% on Spanish GDP in the first year, depending on the assumption made regarding the European economies’ ability to replace Russian energy sources. 2  In this uncertain scenario, one of the main worrisome developments is being the significant increase in the rate of inflation at the world, European and Spanish level. In particular, inflation in Spain rose significantly in 2021 and accelerated further in early 2022, reaching 10% in June. Moreover, although the price rises were initially concentrated in commodities and food and seemed to be relatively temporary in nature, in recent quarters their intensity has systematically surprised on the upside, spreading to the rest of the goods and services in the consumption basket and showing signs of greater persistence. Therefore, analysing the current inflationary episode, with a particular focus on the factors that may influence the persistence of these dynamics in the future is of paramount importance for the recovery of the Spanish economy. Wage and mark-up dynamics are particularly relevant in this regard.
Nevertheless, in the case of the large international banks, the empirical evidence would seem to suggest that these institutions have long exceeded the size needed to make full use of these advantages. It should be noted that although the instrument of size restriction is far-reaching, it is by no means new in economic policy. For decades it has been one of the tools for preventing market dominance in the area of competition policy. Within the context of financial stability, the objective of such a measure would be to reduce risks to the stability of the banking and financial system, rather than to maintain competition. I would like to run through the last few points again briefly. In the short term, priority must be given to overcoming the crisis. However, in order to increase the stability of the financial system in the medium to long term, we consider a reform of the operational environment in the banking sector to be essential. We attach particular importance to alleviating the “too big to fail” problem. Apart from stricter rules for systemically important institutions, the SNB currently envisages two further options that it intends to examine – first, measures to facilitate the wind-down of large, international institutions and, second, direct and indirect measures to limit their size. The SNB will examine all of these in depth, in close collaboration with FINMA, alongside possible further options. There can be no more taboos, given our experiences of the last two years.

If the governments of the Member States of the euro define jointly and irrevocably their vision of what the political and economic construct that supports the single currency will be and what the conditions to reach that goal together should be. This is the most effective answer to the question everyone is asking: “Where will the euro be in ten years’ time?”. The second pillar is that of structural reforms, especially, but not only, in the product and labour markets. The completion of the single market and the strengthening of competition are crucial for growth and employment. Labour market reforms that combine flexibility and mobility with a sense of fairness and social inclusion are essential. Growth and fairness are closely connected: without growth, and the events of recent months also reflect this, the temptation to “circle our wagons ”gains strength, and solidarity weakens. Without fairness, the economy breaks up into multiple interest groups, no common good emerges as a result of social and economic interaction, and there are negative effects on the capacity to grow. Recent Italian history has no shortage of examples. These reforms have long been indispensable in a global economy very different to the one which witnessed the creation of the institutions still operating today. In the political structure that will emerge from the crisis it is likely and desirable that for these reforms a system of European rules will be introduced similar to that for the fiscal compact, a discipline leading over time to the European harmonisation of objectives and tools.
At the moment, the disruption of the global value chains globally and the growth of costs are creating interruptions in certain industries and are one of the major risks to the expected economic recovery. Hence, timely monitoring of all risks and their timely identification is a current priority, in order to reduce the burden on the banks' balance sheets. According to the latest EIB survey, some of the banks in the wider CESEE region expect a certain increase in nonperforming loans in the period ahead. Upward shifts are also possible in our country, but for the time being the stress tests show sufficient resilience of the banking system, in conditions of a strong regulatory framework, cautious behavior of banks and signs of economic recovery. The central bank's policy is currently relaxed, thereby contributing to favorable conditions of financing and economic recovery, in circumstances when we have enough comfort in the foreign reserves to respond to possible shocks. Of course, given the uncertain environment, we constantly and carefully follow the trends of all indicators, relevant to the monetary policy. At the moment, almost in all countries, the growth of savings increases the sources of funding for banks and their capacity to support the economy, especially at the points that will meet the new post-pandemic requirements and will increase the growth potential. The transition to a green economy is undoubtedly one of the issues that with the pandemic has moved from the margins to the core of priorities.

Second, do the new circumstances change the investment behavior of the population and what consequences may it have on the financial stability? Third, what are the processes that accelerated and surfaced due to the pandemic, and which are also an opportunity for productive use of savings and financial support of sustainable projects by the financial sector? Unlike other crisis episodes, the pandemic has actually increased savings and this process is a global phenomenon. In the developed countries, the estimated excess savings in 2020 was nearly 7% of GDP, showing that savings were higher in the pandemic, than in normal circumstances. In the region of the Western Balkans, the rates of domestic savings measured as the difference between the generated income and the total private sector and government consumption registered a slight decrease of around 3 percentage points of GDP, but in conditions of a strong fiscal consumption for support of the economies. This means that private sector savings, despite the great recession, it is very likely that they remained relatively stable or grew. There are three reasons that contribute to this phenomenon. First, despite the recession, disposable income did not decrease, partially due to the fiscal impulse for support of wages and  1/3  BIS - Central bankers' speeches  jobs.
The ECB Governing Council has increased its policy rates by 200 basis points since July: we have moved closer to the neutral rate which we estimate to be around 2%, and which we should reach at our next meeting on 15 December. Let us be clear: this rate rise is good news for banks and insurers, who have long been critical of low rates. Financial institutions want the rise to be orderly: it is, very much so; but this does not mean it should be too slow, or predetermined. It is still too soon to talk about a "terminal rate": we will decide what is necessary following a meeting-by-meeting approach; and we do not steer market rates, which are sometimes excessively volatile. The return of volatility in the markets, starting with commodity markets where margin calls reached historic highs this summer. In equity markets, after the corrections observed since the start of 2022, valuations remain relatively high. Fixed income markets are also showing strong volatility, with one extreme example being the September UK sovereign debt crisis: aside from a few specific factors, this was a reminder to everybody of the crucial importance of credible fiscal policies. In light of this market volatility, it is more important than ever that we protect customers. I would just like to say a word here on the increased transparency and justification of life insurance fees: in a speech to you alongside Jean-Paul Faugère, I called for progress to be made this year, with a particular focus on dialogue with insurers.

Managing Machines: the governance of artificial intelligence  Speech given by James Proudman, Executive Director of UK Deposit Takers Supervision  FCA Conference on Governance in Banking 4 June 2019  I am very grateful to Philip Sellar for preparing these remarks, and to Sadia Arif, Jamie Barber, Jas Ellis, Magnus Falk, Orlando Fernandez Ruiz, Anna Jernova, Carsten Jung, Tom Mutton, Lyndon Nelson, Jennifer Nemeth and Oliver Thew for very helpful advice and comments. 1  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  Introduction Consider the well-known story of one Big Tech company’s attempt to use artificial intelligence to improve the efficiency of its staff recruitment. The machine learning system reviewed job applicants’ CVs with the aim of automating the search for top talent. The company’s experimental hiring tool used artificial intelligence to give job candidates scores ranging from one to five stars. Within a year, the company realised its new system was not rating candidates for software developer jobs and other technical posts in a gender-neutral way. That is because the computer models were trained to vet applicants by observing patterns in CVs submitted to the company over a 10-year period. Most came from men, a reflection of male dominance across the technology industry. In effect, the company’s system taught itself that male candidates were preferable. It penalised CVs that included the word “women’s” as in “women’s chess club captain”. And it downgraded graduates of two all-women’s colleges.
5 This includes recapitalisation measures, asset relief interventions, liquidity measures and guarantees. For  2009, the numbers as a percentage of GDP are around 12 % for Netherlands, 8 % for Germany, 5.4 % for Spain and 5 % for France. See Financial Crisis Aid amounts for a more detailed breakdown. 6 Laeven, L. and F. Valencia (2013), “Systematic banking crisis database”, IMF Economic Review, 61(2): 225–  270. 7 E.g. Diamond, D. and P. Dybvig (1983), Bank runs, deposit insurance and liquidity”, Journal of Political  Economy, 91(3): 401–419; Cooper, R. and A. John (1988), “Coordinating coordination failures in Keynesian models”, Quarterly Journal of Economics, 103(3): 441–463; Calvo, G. (1988), “Servicing the public debt: the role of expectations”, American Economic Review, 78(4):647–661. The search and matching literature also exhibits multiple equilibria, e.g. Diamond, P. (1982), “Aggregate demand management in search equilibrium”, Journal of Political Economy, 90(5): 881–894. 8 Gertler, M. and N. Kiyotaki (2015), “Banking, liquidity and bank runs in an infinite horizon economy,” American  Economic Review, 105(7): 2011–2043. 9 Eggertsson, G. and M. Woodford (2003), “The zero bound on interest rates and optimal monetary policy”,  Brookings Papers on Economic Activity, 34(1): 139–235; Woodford (2012) “Methods of Policy Accommodation at the Interest-Rate Lower Bound,” presented at the Jackson Hole symposium, August. ; Nakov, A. (2008), “Optimal and simple monetary policy rules with zero floor on the nominal interest rate”, International Journal of Central Banking, 4(2): 73–127.

As short-term interest rates approached the effective lower bound, central banks on both sides of the Atlantic undertook a number of unconventional measures aimed at influencing the whole constellation of rates that are important for the financial decisions taken by households and businesses. Forward guidance helped guide market expectations of future short-term rates. QE involved direct intervention by central banks in markets through large scale asset purchases to influence the yield curve beyond the very short term. A large body of empirical research has substantiated the success of these policies in supporting the economy and inflation, both in the euro area and in the United States.13 But central bank policy moves extended beyond just measures to counteract the impairment of the transmission mechanism caused by financial frictions. The ECB also acted in various ways to prevent self-fulfilling expectations from delivering socially undesirable outcomes by coordinating expectations onto “good” outcomes. One such policy initiative was our lender-of-last-resort intervention during the financial crisis. Revisiting the Bagehot principles set out a century and a half ago in the light of the ongoing crisis,14 the ECB lent freely to solvent financial institutions against sound collateral, penalised by a haircut. We did so in multiple ways: our liquidity operations moved to a fixed rate full allotment basis with unprecedented maturity of four years, and we widened the eligible collateral accepted in our operations.
It is sometimes pointed out that one of the problems with make-up strategies is that their strict symmetric application may create problems for the credibility of the strategy. For example, if there is a commitment by the central bank to react equally to both inflation undershooting – which, as we have seen, are the really problematic deviations in the current context – and overshooting, we could find that, following a period of above-target inflation the central bank would have to reduce inflation below the target, which would require depressing economic activity and employment. Given that such a commitment may not be entirely credible, it has recently been proposed that such strategies be temporary. In other words, the central bank operates normally within a traditional inflation targeting framework, but, in the event of a low inflation crisis driving  12  See Banco de España (2020a) for a detailed discussion of make-up strategies. 16  interest rates close to their lower bound, it commits to a make-up strategy to recover the “lost inflation” over that period in the future.13 Against this background, in late August 2020 the Federal Reserve announced the main findings of its strategic review. Among other changes, it has adopted a new asymmetric average inflation targeting strategy, albeit without specifying some of the parameters of this strategy, such as the length of the period over which the average inflation to be stabilised is calculated.

29  These percentages should be considered as the lower bound of the total impact of the interest rate rise, as this would also reduce agents’ income, through its negative impact on economic activity, and would curb the accumulation of wealth on account of the higher net interest burden. 30  Moreover, these were the households whose energy expenditure increased the most, as a proportion of their consumption, in 2020 and 2021. 15  High debt levels also mean that public finances are more sensitive to interest rate movements. However, the low interest rate levels of recent years have led to a continuous decline in the interest burden as a percentage of GDP, while at the same time, longer average debt maturities have limited the short-term impact of higher issuance costs. Under a scenario of gradual interest rate rises consistent with the latest projections, the debt burden is expected to stabilise as a percentage of GDP. Under that same scenario, an additional 100 bp increase in short and long-term interest rates, with all other variables remaining constant, will drive up interest payments by 0.4 pp of GDP by 2024. 16  In the Spanish banking industry stress tests, two potential stress scenarios – dubbed adverse and severe – were simulated for the period 2022-2023.
This agreement thereby affects some 20% of the labour force and includes rules that reduce the risk of periods without agreements and rules that reduce the risk of conflicts breaking out. In the state sector, adaptation of pay bargaining has been facilitated by the frame budget process, which entails that wage development in the export industry shall set the level for state wage costs. With the intention of facilitating wage formation compatible with economic balance, the Government introduced a bill in December last year that included proposals to create a new agency, the Mediation Institute. The bill includes measures that aim to reduce the risk of conflict breaking out and are to come into effect if contractual solutions are not reached in some other way. In conclusion The state of the Swedish economy is better than for a very long time. Inflation expectations have stabilised around the target and economic policy is focused on continued consolidation of public finances. The prerequisites for the Riksbank to conduct monetary policy so that it contributes to stabilising growth around its long-term path are thereby improved. 5  BIS Review 20/2000  However, this does not mean that challenges are lacking with regard to striking the right balances in monetary policy. I have discussed some of these. One is the assessment of productivity growth and the potential growth in the next few years. There are still no signs that we will see a productivity growth such as in the USA.

Yet the race to achieve net-zero emissions (‘net zero’) by 2050 is a multi-decade marathon, where the starting gun has already fired, and getting to the finish line will require a sprint start, with a reduction in global emissions of a half by 2030 [figure 1 in the Appendix].1 What I would like to talk about today is how we get there – both what we know and what we don’t know - and the important role of climate scenario analysis in helping us plot the best course. Governments will of course play a central role in laying the track, removing hurdles and setting the pace as we move to net zero. Over 110 countries, including the UK, have now moved to enshrine net zero emission targets in policy or law and are working on detailed plans of what these look like in practice.2  But climate change and climate policy will affect everyone - businesses from all sectors of the economy, public bodies like the Bank of England, households and individuals. And so we all have a stretch of the race to run. Some will perform strongly, others may struggle, and some, particularly in less developed countries, might need a helping hand. But let’s be in no doubt. We need everyone to finish. Role of the financial sector  Let me first say a few words about financial institutions given the unique role they play in this race. As corporates, these firms have some direct emissions but they are not significant.
More surprising is that there has been no recovery in these rates of productivity gain during the subsequent jobs recovery (Chart 23). The rungs in the jobs ladder have had a smaller productivity spacing than in the past. 20  All speeches are available online at www.bankofengland.co.uk/speeches  20  Chart 23: Firm productivity difference when moving jobs Per cent 16%  Firm productivity change  14% 12% 10% 8% 6% 4% 2% 2004  2006  2008  2010  2012  2014  2016  0% 2018  Sources: ONS and Bank of England calculations. Notes: Chart shows percentage difference in productivity between new firm and old firm with the median workers moves between firms. Summing up, then, a strong jobs recovery has not resulted in workers vigorously re-climbing the jobs ladder. Both their willingness to climb, and the pace of this climb, has been subdued relative to the strength and tightness of the jobs market. Post-crisis risk aversion, and changes in the nature of work, may have increased insecurities and dimmed workers’ appetite for a vertiginous career climb – or indeed any climb. The result has been subdued rates of pay and, in particular, productivity growth. Just recently, some of these patterns in pay, if not productivity, have begun to reverse themselves. Nominal pay growth has been going slowly through the gears over the past few years, from being in the “low 2s” three years ago, to the “high 2s” 18 months ago to having a “3” in front of it now.

This strategic move speaks louder than words and confirms that there are enormous opportunities here, which the bank can benefit from, despite the stiff competition in the market. Ladies and Gentlemen, another issue that the Bank of Zambia continues to challenge commercial banks on, is the cost of borrowing which continues to be high in spite of the efforts by the Bank of Zambia and the Government in ensuring that these costs come down. As you are no doubt aware, the Bank of Zambia reduced the Statutory Reserve Ratios from 14% to 8% in October, 2007 with a primary aim of bringing the cost of borrowing down. Further, in the recent few years, the Bank had managed to contain inflation to low levels in order to further reduce the lending rates. Coupled with this, in the recent past, the Government adopted prudent fiscal policies that enabled the private sector to access more credit from the financial system. Despite these efforts, credit is still not affordable to the majority of our people. This high cost has in turn stifled the growth of the productive sector and in particular Agriculture and the SME sector, which are the engine for the economic growth of our country. Hon Minister, I am however, glad to note that credit to the private sector has increased significantly with the Personal loans category accounting for the largest beneficiary of credit followed by the Agriculture sector.