samchain/econo-pairs-v1 huggingface dataset:
In light of this, businessmen and the press started to become concerned about the potentially higher unemployment, which exacerbated confidence further. Turning to economic stability, inflation pressure has dissipated starting August 2008. Headline and core inflation rates, which were at 9.2 and 3.7 percent respectively at their peaks in July 2008, fell to 0.4 and 1.8 percent at the end of the year. As for the financial sector, our banking system is healthy in terms of profitability and capital base. I will return to touch on the financial sector later on. Economic stability on the external front is also very strong. For 2008, the current account recorded a small deficit of 0.2 billion US dollar. Our international reserves amounted to 111 billion US dollar, which is 4 times of short-term external debt. The exchange rate remains competitive and stable. For 2008, the capital account recorded an overall surplus of 12.8 billion US dollar, of which foreign direct investment or FDI was 9.9 billion US dollar. FDI from Europe accounted for about 11 percent of total FDI. Excellencies, For the prospect of the Thai economy this year, the Bank of Thailand sees a growth rate of 02.0 percent and 2.0-4.0 percent next year. I wish to emphasize that the growth performance depends not only on how fast the global economy recovers, but also on how fast confidence within the country could possibly pick up, which will help ensure the recovery of domestic demand.

If inflation looks likely to exceed the Bank’s target limits in a long-term perspective, the Bank will raise its policy interest rate, or cut this rate if inflation is heading below the target limit. In preparing its inflation forecasts and regular assessment of the economic situation and outlook, the Central Bank examines a wide variety of indicators. These include both statistical data and information  BIS Review 12/2003  1  obtained from interviews with representatives of industry, special interest groups, credit institutions and others. Much of this statistical data is available on the Bank’s website. Decisions by the Central Bank’s Board of Governors are made following in-depth examination of these indicators, based on the Bank’s evaluation of the situation and prospects, the premises behind the inflation forecast and the inflation forecast itself. In accordance with the provisions of the Act which entered into force in the spring of 2001, the Board adopted internal rules on the preparation of, arguments for and presentation of its monetary policy decisions. The rules were formally approved at the beginning of 2002 and published in the quarterly Monetary Bulletin. The inflation target adopted in March 2001 removed the earlier fluctuation bands set for the ISK exchange rate and the exchange rate was floated. The new monetary policy framework was introduced under rather difficult conditions, with a sliding exchange rate and mounting inflation. It is fair to say that the tight monetary stance is the main reason that inflation receded as sharply as it did in 2002.
20 For a further discussion of the shape of the demand curve for reserves and its implications for policy implementation, see Logan, “Operational Perspectives on Monetary Policy Implementation: Panel Remarks on The Future of the Central Bank Balance Sheet,” May 4, 2018. 8  above-IOR lending remains low as a share of the overnight bank funding market, as shown in Figure 9. 21 I might also expect to see shifts in bank payments behavior—for example, more daylight overdrafts or more effort by banks to “optimize” their payment flows—but I have not seen this either. Most fundamentally, I might have observed a day-to-day relationship between shifts in the stock of reserves and overnight interest rates. Figure 10 shows a scatterplot of daily changes in reserve balances against daily changes in the spread between the IOR rate and the effective federal funds rate; there is no visible relationship. 21  On Oct 24, 2018, there was an increase in the share of federal funds transactions trading above the IOR rate, reflecting an increase in bank borrowing from Federal Home Loan Banks (FHLBs) to manage LCRs, rather than interbank lending. 9  Recent experience supports my belief that we are not at the “steep” portion of the demand curve and aggregate reserve scarcity. On one day in mid-September, there was a large drop in reserves—of nearly $ billion—as the Treasury increased its cash holdings at the Federal Reserve as a result of third-quarter tax receipts, as shown by the red point in Figure 10.

As a result, reserve balances fell to one of their lowest levels in a number of years apart from quarterends and were close to some private-sector estimates of where reserve scarcity might appear. Based on a wide range of indicators, and as suggested by the chart, there was no evidence of reserve scarcity on an aggregate basis; indeed, based on the metric shown, rates were little changed on this day. It seems highly likely that we are still on the “flat” part of the curve, where rates move little in response to shifts in reserves. However, it is still possible that the decline in reserves might be putting some upward pressure on rates. Even in the “flat” part, the slope of the demand curve, while small, might be nonzero. This could be true if, for example, the balance sheet costs of the marginal borrower in overnight money markets were upward-sloping with respect to that bank’s balance sheet size. I see this as a reasonable possibility, and therefore I think it might be possible that the decline in reserve balances has pushed up overnight rates a bit over time. 22 Figure 11 provides some evidence of this dynamic; as the level of reserve balances has declined, the spread between the rate of interest paid on reserves and the volume-weighted average federal funds rate has narrowed.
Similarly, in 2005 euro area residents held foreign portfolio holdings with a total value of approximately 3.5 trillion euro, a figure that is almost half of euro area’s annual GDP. Cross-border financial linkages, new financial products and the possibility of more accurate and wider risk-sharing have however also raised the level of interrelations across national financial markets. This implies that financial systems are more exposed to common risks, as financial disturbances may be transmitted more easily across borders in periods of turbulence. As a result, sceptics have indeed expressed concerns about the sustainability of global financial integration, which is regarded by some as having the potential to destabilise the global economy. But there is also an opposing view according to which global financial integration reduces the risks to the global economy, for which there are convincing arguments. In this respect, empirical evidence suggests that the strongest determinants of the global portfolio reallocation over the 1997-2001 period were (1) the need to diversify the risks of holding foreign portfolio assets across several countries, and (2) the willingness to close the gap between actual and optimal shares of foreign investment, which suggests that rational portfolio optimisation was the primary motivation behind investors’ reallocation of their international portfolios. This has two main implications: first, that investors do not ignore the main principles of portfolio theory; and second, that portfolio investments might be less prone to boom and bust cycles, being driven by long-term economic fundamentals.

Had the APF done so, in addition to strong primary market private sector demand, it would undoubtedly have helped to drive down market spreads. But it would also have risked displacing that private sector demand, to little purpose in my view. In fact, a greater intervention in this market during this period could have made things worse – the problem was in the functioning of the market, not a lack of demand for the assets. It would be fair to say that the corporate bond scheme attracted some criticism in its early months. Many observers misunderstood the nature and purpose of the scheme and considered that the small amounts bought were a sign of failure. But, as I have stressed tonight, the objectives of the scheme were not based on buying a particular amount. In fact, over the past year, the corporate bond market overall has performed consistently strongly and in line with the original objectives of the scheme: There has been record issuance of sterling corporate bonds (Chart 5); spreads for eligible bonds have halved (Chart 6); bid-offer spreads have narrowed; and the bond-CDS basis 6 has also contracted significantly. These asset purchases do seem to have played their part in improving the access of investment grade corporates to bond market financing. The one disappointing feature of the sterling corporate bond market is the continuing problem of secondary market illiquidity.
This resulted in a series of devaluations, a smaller one of 3 per cent in 1976, two of them, 6 per cent and 10 per cent, in 1977, one of 10 per cent in 1981 and a large devaluation of 16 per cent in 1982. Overheating in the 1980s The 1980s thus began with two devaluations in 1981 and 1982. The background to these was that the end of the 1970s and beginning of the 1980s had been very problematic. GDP growth had been poor, and production actually fell a couple of years. Unemployment had risen to 3-4 per cent, which was then regarded as a very high level. Inflation had soared to levels of 15 per cent. The current account and public finances showed a substantial deficit. Sweden found itself in a situation with weak real growth and twin financial deficits. I took part in the preparations for the devaluation in 1982, in connection with the change of government that year. The preparations were led by Kjell-Olof Feldt, Erik Åsbrink and Michael Sohlman. I had the task of making calculations of economic developments over the coming years, based on different economic policy alternatives. Two of the alternatives concerned expansionary fiscal policy to bring down unemployment and a strongly contractionary fiscal and monetary policy to eliminate the twin deficits. In both cases, substantial problems remained in the Swedish economy. The third alternative concerned a devaluation of 20 per cent in autumn 1982, combined with a price stoppage and pegging the krona to the D-mark.

Howard Lee: Keynote speech – ASIFMA 9th China Capital Markets Conference Keynote speech by Mr Howard Lee, Deputy Chief Executive of the Hong Kong Monetary Authority, at the ASIFMA 9th China Capital Markets Conference, Hong Kong, 29 November 2019. * * *  Riding the Wave of Portfolio Inflows into Mainland China Mark (Austen), distinguished guests, ladies and gentlemen, 1. Good morning. Thank you ASIFMA for hosting this Conference in Hong Kong and inviting me to speak. I am glad to see so many friends of the financial industry here today, from Hong Kong and other parts of the world. 2. As you all know, Hong Kong has been going through an extraordinary period since this summer. For those of you who travel to Hong Kong for this conference, I hope you have so far found the situation on the ground less dramatic than what you might have seen from the news. No doubt we have experienced some serious disruptions to traffic and interruptions to operations of bank branches, but overall speaking the financial infrastructures and markets in Hong Kong have continued to function smoothly, and they remain robust and resilient. This clearly demonstrates their ability to withstand different types of shocks, as they did multiple times in the past decades. 3. Earlier this week, Hong Kong successfully launched the $ billion IPO of Alibaba. This deal would likely put us at the top spot of the global IPO league table again this year.
To use real time detailed communication and press conferences in this way was a logical decision, bearing in mind (i) the attention the ECB would receive as a major player in the world financial markets and the global economy, (ii) the necessity to “frontload” the public and the markets with information on the thinking of the new institution and (iii) the interest as regards communication at national level through many different languages of having timely public terms of reference. I do not hesitate to say that this new ECB concept of real time detailed communication has been an important element of the new paradigm in central banking communication. Second, there is the ECB’s Monthly Bulletin, which is always published one week after the press conference. It gives a more detailed explanation of the analysis behind the monetary policy decisions. It regularly reports on information collected by the ECB, such as the bank lending survey. Importantly, it now also includes the ECB staff projections four times a year. An advance copy is published immediately after the Press Conference following the Council meeting. This is another example where the ECB has gone very far in making its policy transparent and communicating its economic assessment in real time. The Monthly Bulletin also contains articles which provide insights into the principles governing our policy. Third, the members of the Governing Council members give interviews and speeches to many different audiences. In them they explain the decisions taken and the ECB’s view on current topics within our sphere of competence.

The level of activity in the Finnish economy is still poor, but will benefit, like the Swedish economy, from the global improvement in economic activity. In Denmark and Norway, private consumption will be stimulated by tax reductions. There are also signs of a turnaround in industrial activity in the UK, while private consumption continues to develop favourably. However, there are also risks for developments in Europe: in the euro area the main cause of uncertainty is wage developments. High wage increases for metalworkers in Germany may spread to other sectors and then to other countries in the euro area. There is thus some possibility that the rate of wage increase and inflation in the euro area will be higher than in the main scenario depicted by the Riksbank. The economic situation in Sweden The Inflation Report that was published at the same time as our interest rate decision paints a mainly bright picture of the Swedish economy in the near future. The assessment is that the downturn in economic activity will be shallow and relatively short-lived. The recovery in global market growth, which for Swedish goods amounts to 2-3 per cent this year, will lead to an increase in Swedish exports. Over the next few years, this increase is expected to become 7-8 per cent a year. At the same time, households’ disposable incomes are improving, which contributes to increased consumption.
Christian Noyer: Public and private debt – imbalances of global savings Introductory speech by Mr Christian Noyer, Governor of the Bank of France and Chairman of the Board of Directors of the Bank for International Settlements, at Session 3 “Public and private debt – imbalances of global savings”, Aix-en-Provence Economic Forum, Aix-en-Provence, 6 July 2012. *  *  *  In introduction to this session, I would like to make seven remarks. My first remark is inspired by the very title of this session. In advanced countries, the average public debt to GNP ratio is 100%. In emerging countries, the figure is 30%. This is a very wide gap, and it represents one of the global economy’s largest imbalances. And one of the least mentioned. It also represents a complete reversal of the situation compared with just over twenty years ago. At that time, I remember well, I was chairman of the Paris Club, and emerging countries came to ask for the rescheduling of their debt. Second remark, global demand is still fairly concentrated on the advanced countries. Not only is their debt higher, but their savings (as a ratio of GNP) are lower. The G7 countries alone still account for 56% of global consumption. The problem is clear. How can we hope to raise our level of consumption if we need to reduce our level of debt and increase our savings?

Debt markets are profoundly disrupted and international movements of capital have been highly volatile over the last two years. Fifth remark. The intervention capacities of central banks are of course limited. They can remedy temporary market disruptions and situations of illiquidity caused by uncertainty. Recently they have intervened to an unprecedented extent, as reflected in their balance sheets. But they cannot permanently substitute financial markets and banks when financial intermediation malfunctions. Likewise, low or zero interest rates can contribute to stabilising  BIS central bankers’ speeches  1  the economy in periods of crisis, but if maintained over a protracted period, they can create distortions, encourage the formation of bubbles and create risk for long-term investors. Indeed, on this topic, I would like to make one observation. The question of monetary financing of deficits was raised by David Thesmar. Such financing cannot in any way resolve the problem of the dislocation between savings and investment, either at the national level or at the global level. Some central banks have developed large-scale public debt acquisition programmes. They have done so for reasons relating to immediate macroeconomic stabilisation... to go beyond the zero-interest rate limit. The Eurosystem as well intervened on a much smaller scale when malfunctioning debt markets prevented the effective transmission of monetary policy impulses. There is not a single central bank that is seriously considering the monetisation of deficits with the more or less declared intention of reducing the weight of debt via inflation.
In fact I think we probably tend to err on the side of drawing too much, rather than too little, attention to differences of opinion within the Committee which are often largely a question of nuance. But it is better in my view to err on that side rather than to attempt to submerge the differences. We do not, however, attribute particular views to particular individuals. To do so would invite prepared statements and militate against the inter-active debate which is an outstanding and immensely valuable characteristic of our meetings. It would suppress the kind of “what if” discussion in which the same individual may explore alternative views. No attempt is made to concert the outcome of the policy decision; in fact I go out of my way to discourage any kind of collusion, whether between the internal or external members of the Committee - we are, and must remain, nine independent members, individually accountable for our decisions as to how we vote. This, of course, means that the Committee is divided as often as not; but although this initially led to public comment to the effect that the Committee did not know what it was doing and could not make up its mind, it is now generally accepted as the natural order of things and helps to underline to the public at large that monetary policy making cannot be a precise science - however much it needs to be informed by all the science available to us.

Prices of unprocessed foods continued to contribute to downward annual inflation, while the contribution of other categories was relatively stable. Inflationary pressures from the demand side remain low and are conditioned by the continued negative output gap and lack of cost-related pressures on the economy. Moreover, low increase of consumer prices has reflected economic agents’ expectations on inflation. According to INSTAT data, Albania’s economy growth rates improved over the third quarter of 2011, posting an annual growth of 2.6% over this quarter. On the production side, growth was supported by branches of the industry sector and services. On the demand side, economic growth continues to be driven by foreign demand, while domestic demand remains sluggish. A similar growth model is assessed to have taken place in the fourth quarter of 2011. Based on the analysis of aggregate demand components, the Bank of Albania judges that foreign demand was the main driver of demand increase during 2011. Although not at the levels of previous year, exports continue to grow. Latest foreign trade data point to our exports annual growth by 20.7% in December. On the other hand, imports accelerated their growth rates in this month, posting an annual growth of 14.5%. This performance is reflected in the widening of the trade deficit by 12.0%, year on year. To a large degree, the trade deficit reflects price developments in international markets. In real terms, the trade deficit is assessed to have narrowed during 2011. Indirect data show that consumption was poor over the second half of 2011.
Our projections are based on the assumption that fiscal policy will provide some stimulus to aggregate demand and output in 2008 and 2009, but somewhat less than a mechanical application of the fiscal rule based on our oil price assumption would imply. High growth in the global economy has pushed up prices for non-oil commodities as well. Over the past year, copper prices have more than doubled and aluminium prices have risen by more than 60 per cent. Futures prices have also risen markedly, indicating expectations of a permanent upward revision of metals prices similar to the revision of oil prices. Rising commodity prices and buoyant activity in markets that are important for Norway have fuelled growth in the Norwegian economy, even though growth has been low in some of Norway’s most important export markets. Overall, prices for our imported goods are falling in relation to prices for goods we export. Norway’s terms of trade are improving. The impact of the rise in oil and gas prices is particularly strong, but the terms-of-trade gains for the mainland economy have also been high. The domestic economy is partly insulated thanks to the oil fund mechanism. The situation in Norway differs from that of its Nordic neighbour countries. Sales of Swedish and Finnish high-tech products are growing strongly in volume terms, but prices are falling. Denmark has a diversified business sector, which is overall moving on a steady path. 4  BIS Review 41/2006  Growth among our trading partners remains solid.

Our assessment however raised some important questions around how the system operates – particularly whether calling cash variation margin intraday can be made to work more effectively. The frequency and timing of these intraday calls, particularly when issued ad hoc, was not always sufficiently clear to all participants, further complicating liquidity management issues for some. In some instances, unexpected or late-in-the-day margin calls posed operational challenges to making timely payment for some participants. These challenges around the predictably of variation margin calls reflect a wider issue of transparency in the margining process. Most CCPs provide tools that allow clearing members and clients to calculate margin requirements for existing portfolios as well as changes to portfolios that participants expect to make. Some CCPs also provide additional functionality allowing participants to calculate margin requirements under “what if” scenarios. On the other hand, many banking and non-banking participants reported to us that margin calls were insufficiently predictable, with considerable uncertainty over the scale and the speed of increases they were likely to face over a given time period, or for a given level of volatility. Participants reported that the availability of more information on how the models are calibrated and the wider provision by CCPs of high quality margin calculators and other tools, would enable them to generate forward-looking predictions of margin requirements at portfolio level. The surveys also revealed a picture on whether market participants were prepared adequately for margin calls in a severe stress.