samchain/econo-pairs-v1 huggingface dataset:
So, although growth will not be very strong I do not see them entering a recession again. Even the hardest hit Southern European and Mediterranean countries have the potential to see growth as early as next year. Which is a positive indicator for our more traditional export firms; as several of these countries act as their largest trading partners. Our confidence is building. If this year we will see a 2.2% increase in overall growth we predict next year can yield 3.5% and it can certainly grow from there to over 4% in ensuing years. First-movers entering this market will be the ones benefiting from the immediate and privileged market access Do you see Macedonia’s current inability to enter the EU due to the naming dispute with Greece as a component that is putting a relative cap on the growth figures you just mentioned? If we look from an economic point of view, judging from rating agency criteria that takes into consideration political uncertainties such as the ongoing naming issue, it is safe to assume that our rating is lower than what it could be. The resolution of this dispute and the resulting  2  BIS central bankers’ speeches  increase in rating will certainly lead to greater investor confidence as well as better terms on financing in the international markets. There would also be access to more EU funds that could be used for critical infrastructure developments.

Interest rates were assessed by the Executive Board of Norges Bank yesterday. Interest rates were left unchanged. Norges Bank’s key interest rate, the sight deposit rate, therefore remains at 7 per cent. According to Norges Bank’s assessment, with an unchanged interest rate, the probability that inflation two years ahead will be higher than 2½ per cent is the same as the probability that it will be lower. A sharp rise in labour costs is contributing to a relatively high rise in prices for goods and services produced in Norway. A persistently strong krone will contribute to keeping down prices for imported goods. The strong krone will have consequences for activity in the internationally exposed sector. Together with prospects for low inflation internationally, the strong krone is the most important force acting as a counterweight to the sharp rise in domestic costs. 4  BIS Review 51/2002
To achieve these objectives, there has been insistence both in the Banco de España’s reports and in my regular appearances before Parliament on the need to undertake wideranging reforms. The list is an extensive one and includes areas such as education, the knowledge economy, the liberalisation of goods and services markets, the boosting of competition in the network industries and the introduction of further improvements in the house rental market. However, I would like to stress two reforms which I consider most pressing and necessary: budgetary consolidation policy and labour reform. The government has in recent weeks  BIS Review 27/2010  1  tabled some proposals for reform which, in my view, are in the right direction. In respect of public finances, a cut of € billion in overall general government spending has been announced in the period up to 2013 and, within the framework of the so-called Toledo Pact, an increase in the retirement age has been proposed that would contribute significantly to the financial balance of the public pensions system. The budgetary measures proposed are a significant public commitment by the government to fiscal consolidation. For that very reason, it is now essential that these commitments should be actually met, since otherwise Spain’s credibility might be most adversely affected. As regards the labour market, the social agents have reached a wage agreement and the government has set out proposals for labour reform.

Export demand was expected to rise at a slower pace, while domestic demand was forecast to increase somewhat faster, mainly owing to increased investment but also to a slightly stronger pick-up in private consumption. That was also assumed to contribute to an improvement in the labour market. Against the background of the continued cyclical upswing and expectations of a reduction in spare resources, domestic inflation was forecast to rise. Higher wage costs in line with an increase in employment and lower productivity growth was assumed to imply a faster increase in unit labour costs and a gradual rise in companies’ costs. The factors that had resulted in falling prices for imported goods in the past year were estimated to gradually diminish during the forecast period, even though we anticipated that imported inflation would remain low in the period ahead as well. It is reasonable to expect that a pick-up in resource utilisation in the world economy will lead to higher international price pressures. We also made the assessment that the krona would not appreciate nearly as much during the forecast period as in recent years and that it would therefore not have as large a restraining effect on price increases in Swedish kronor in the period ahead. The shift seen in imports in recent years, which has involved a greater share coming from low-cost countries, is likely to continue, however, and probably depress import prices in the period ahead as well.
This is set to change with the implementation of JomPAY, which is a common and open platform that allows customers of any bank to make online bill payments to any merchant registered with JomPAY. In other words, a merchant will be able to receive payments from customers across all participating banks. This would not only reduce duplication of investment costs by the banks, but also bring about greater convenience, cost savings and efficiency gains to both consumers and merchants. JomPAY is targeted to be rolled-out in phases starting from next month. (In the next presentation, the Director of Payment Systems Policy Department will provide you with further details of the supporting e-payment infrastructure and the strategies undertaken by Bank Negara Malaysia to accelerate the country’s migration to e-payments.) d.  Safeguarding the security of transactions  Ladies and gentlemen, let me now move on to the issue of security and consumer confidence in the use of online banking and e-payments. Considerable efforts have also been taken by the industry to improve user confidence in the use of payment cards. As I mentioned earlier, the banking industry had migrated our payment cards to the more secure chip-based cards in 2005. The investment cost of RM200 million was subsequently recovered through the projected fraud savings in just two and a half years.

Chart 17 Impact of TLTRO III on bank lending volumes to enterprises  https://www.ecb.europa.eu/press/key/date/2020/html/ecb.sp200519~e5203d3520.en.html  12/14  5/19/2020  Pandemic central banking: the monetary stance, market stabilisation and liquidity  (net percentage of banks, over the past and next six months)  Source: ECB bank lending survey (BLS). Note: Net percentages are defined as the difference between the sum of the percentages for “contributed considerably to an increase” and “contributed somewhat to an increase” and the sum of the percentages for “contributed somewhat to a decrease” and “contributed considerably to a decrease”. Conclusions We continue to monitor market developments closely. In the context of the current extraordinary and severe macro-financial environment, we must ensure our monetary stance provides sufficient accommodation and guards against the escalation of tail risks associated with procyclical financial amplification mechanisms. We continuously examine each of our measures (individually and as a package) to assess whether these are still adequately calibrated and appropriately sized to provide the necessary degree of accommodation in this uncertain economic environment. Accordingly, we are fully prepared to further adjust our instruments if warranted. This includes increasing the size of the PEPP and adjusting its composition, by as much as necessary and for as long as needed. Reproduction is permitted provided that the source is acknowledged.   [1] I am grateful to Danielle Kedan and Julian Schumacher for their contributions to these remarks. [2] See my blog post entitled “The monetary policy response to the pandemic emergency”, 1 May 2020.
In practice, the evidence suggests progress towards improving the public’s understanding of the economy, finance and central banks has been slow and patchy, despite these initiatives. To start with the positives, there is concrete evidence of the improved central bank communications having improved the functioning of financial markets, the forecasting performance of economists and even the reporting of the media on the economy. 13  The transparency revolution improved understanding among those  whose day job it was to understand the economy and the role of central banks within it – the experts. The revolution appears to have had far less impact on understanding among the public – the non-experts. In 1999, the Bank of England began surveying the public to gauge their understanding of the economy and the 14  Bank. Back then, only around 7% identified the Bank’s Monetary Policy Committee (MPC) as responsible  for setting interest rates. 19 years and one transparency revolution later, the same survey earlier this year suggested around 6% of the general public had heard of the MPC. 15  The failure to boost understanding of the economy and central banks among the general public helps explain why trust in central banks proved more fragile than expected after the crisis. It is for these reasons I have spoken about central banks facing a “twin deficits” problem – a deficit of public understanding and a deficit of public trust. 16  These twin deficits are clearly complementary and mutually-reinforcing.

These twin deficits have not, so far at least, had especially serious consequences for central banks. There has been no de-anchoring of inflation expectations. There has been no rolling-back of central bank responsibilities nor systematic retreat from central bank operational independence on monetary and regulatory matters. If anything, central banks’ sets of responsibilities have recently been added to. At the same time, more questions are probably being asked about the role and powers of central bank than at any time in a generation. That is in part a reflection of the increased responsibilities central banks have been handed; in part a reflection of the higher expectations being placed on central banks’ actions; and in part a reflection of the dent in trust in institutions the crisis has delivered. This is a triple challenge. A year ago, the Bank of England hosted a conference to mark 20 years since it was granted operational independence for monetary policy. At that event, I was struck by the number of speakers calling time on the  13  For example, Gürkaynak, Sack and Swanson (2005), Gürkaynak, Levin and Swanson (2010), Berger, Ehrmann, and Fratzscher (2011). 14 Bank of England Inflation Attitudes Survey, currently run jointly with TNS. 15 The same survey also gives the “Bank of England” as option to the question of which group sets interest rates. More respondents identify the Bank of England as being responsible for setting interest rates (around 30%) than the Monetary Policy Committee, but this too has been broadly flat over time.
In Malaysia, almost half of foreign direct investment into our country originate from the regional economies. In addition, Malaysian corporations have also in recent years increased substantially their presence in the region. The success of intra-regional investment reflects the competitiveness and dynamism of Asia. A more recent phenomenon is the increased financial integration. As this occurs, it will result in a more efficient recycling of Asian savings into investments within Asia. Given that Asia will need about USD8 trillion in infrastructure development over the next ten years, the effective channelling of Asia’s large pool of savings into productive uses within the region will be important to support growth and development in Asia. Deeper financial integration within Asia is already occurring as financial markets in Asia become more developed and mature. Regional efforts are being intensified to accelerate this process, including in developing the regional bond markets. Policymakers in Asia have also come together in ASEAN+3 and the Executive Meeting of East Asia Pacific (EMEAP) groupings to promote greater cooperation in maintaining regional macroeconomic and financial stability. The more volatile and unstable international financial and economic conditions have called for the need for greater regional surveillance for the early detection of risks to the region. These have now been put in place including mechanisms to enable the region to cope with rising uncertainties. Through EMEAP, regional collaboration on surveillance has been enhanced to strengthen the region’s vigilance and  2  BIS Review 43/2010  resilience against potential crises.

Yves Mersch: Unveiling the new € banknote Speech by Mr Yves Mersch, Member of the Executive Board of the European Central Bank, at the unveiling of the new € banknote, Frankfurt am Main, 13 January 2014. *  *  *  Ladies and Gentlemen, Thank you all for coming here today to the unveiling of the new ten euro banknote. We shall also be announcing the date of its introduction. Before we do that, let me briefly explain why we consider the issuance of a new banknote to be an important event. First of all, it’s a chance to consider how Europe’s single currency has grown. Euro banknotes and coins started circulating in 12 European countries on 1 January 2002. Today, 18 countries and 334 million people use the euro in their daily transactions. You can travel from Riga to Rome, or from Barcelona to Bratislava, and use the same notes and coins. Today is also an opportunity to take a look at what the euro symbolises. 12 years after the euro banknotes and coins were introduced, it’s easy for us to take them for granted and to forget what an ambitious, even bold, project it was to introduce the euro. The single currency has helped to bring millions of Europeans together, in all our diversity, and the banknotes and coins are a tangible symbol of our determination to support the European Union. When we say, “The Euro. Our Money”, we really mean it! And not just in Europe.
For the central bank, there will be more checks and balance with a separate chairman from the governor under the new BOT Act. In the private sector, the roles of Boards of Directors in providing oversights and setting guidelines for business decisions, and having in place the proper risk management systems are essential to deal with market excesses. The ultimate aim is to enable the economy to adjust flexibly in keeping with changes in the financial environment. To facilitate this, key policies and regulations should focus on promoting market efficiency, as well as reducing distortions and unproductive risk-taking behaviours in the economy. Ladies and Gentlemen, The risks on growth and inflation make 2008 a very challenging year but we will be able to weather it because there is room for the right policy mix and we can capitalize on the economy’s resiliency. But we cannot be complacent about the medium-term challenges of improving and maintaining our competitiveness. Fortunately, the government has already committed to a number of important investment projects to address infrastructure deficiencies. Its investment plans for 2008-2012 focus on the entire spectrum of infrastructure, including the modernization of public transportation, housing and water resource management, as well as health and education spending. BIS Review 63/2008  3  Let me share my thought, in particular, on Thailand’s education system which has immense implications on labor productivity and labour market efficiency, hence competitiveness.

Up to now, monetary policy has remained accommodative to foster the growth momentum but the Monetary Policy Committee will be monitoring inflation developments closely, especially the second round effect of energy prices feeding through to core inflation. The aim is to prevent higher inflation from dampening the anticipated recovery of consumption and derailing the pick-up in investment. Indeed, the MPC has been holding the policy rate, in light of the fact that the growth recovery has remained on track and supported by fiscal policy, while closely following inflation developments. As the MPC meets next Wednesday 21 May, we will assess the latest data available and indicators on both growth and stability to decide on the appropriate stance of forward-looking monetary policy. Ladies and Gentlemen, Undoubtedly, the risks to global growth and inflation will not make macroeconomic management an easy task in the immediate term. But, I can reassure you that Thailand’s economy will maintain its resilience against potentially adverse developments, judging from the following four dimensions. First, policymakers today have sufficient room for maneuvering a flexible policy mix as a result of continued adherence to policy discipline. Our fiscal policy is not constrained by concern on public debt sustainability while monetary and exchange rate policies have room to safeguard economic stability and smooth out short-term fluctuations. Indeed, under the new Bank of Thailand Act, the Monetary Policy Committee will be charged with legal responsibility in the realm of both monetary policy target and exchange rate policy and management.
9 The balance sheet cost associated with the interbank trade can be thought of as capturing the additional risk introduced into the system by that trade. One side effect of interbank trades is that they create a network of exposures that can contribute to financial fragility, as we saw during the crisis. Central bank liquidity provision Let me now turn to the question of broad-based liquidity provision by central banks. As Ulrich notes, there is an academic literature on the topic that focuses primarily on the incentives that individual financial institutions may have to take on excessive risk if they expect the central bank to provide insurance ex post; an incentive often referred to as moral hazard. This framing had become so pervasive that central bankers relied on constructive ambiguity – the idea that if market participants were unsure about whether the central bank might supply liquidity, they might not be as tempted to take privately beneficial but socially costly actions. I don’t intend to discuss constructive ambiguity, but I find it striking that there is little research on this topic directly related to central banking that could help us think of the costs and benefits of such an approach. 10 More generally, now might be a good time for academics and central bank researchers to take a fresh look at the issues of central bank liquidity provision, taking into account, in particular, stigma and liquidity regulation. 11 Let me start with stigma.

Third: Market functioning I have to mention first the assessment of the role of credit rating agencies, their small number, the transparency of their rating methodology, possible conflicts of interest in particular as regards structured finance instruments. Excessive exclusive reliance on credit ratings by investors without carrying out due diligence or conducting further own risk assessment is a problem as well. The road map also includes a reflection on the consequences of the originate and distribute model of banks for credit markets. Does it induce wrong incentives? A last item in this list relates to non-regulated debt markets and mortgage markets, which might deserve a hard look in the light of recent experience. Finally: The regulatory framework Above all, liquidity risk management relating to complex structured products needs to be investigated. We need a wider concept of concentration risk including wholesale and interbank markets as well as intragroup exposures. We have to look at warehousing and pipeline risk, deal with possible regulatory incentives to move risk off balance sheet into SPVs. We have to assess the links between the regulated and the non-regulated part of the system, including the optimal perimeter of supervision. Special purpose investment vehicles and conduits were used as off-balance sheet investment vehicles. These were prone to liquidity mismatches between their assets and liabilities, causing contingent credit and liquidity lines to be drawn on banks, and resulting in an increased demand for money market liquidity.
It is appropriate to point out, however, that although the method stipulated in the Act on Interest and Indexation is not as beneficial to borrowers with foreign-denominated loans as the continued application of the foreign interest rates set forth in the original loan agreements – which some have demanded – it still improves the position of borrowers considerably, compared to the exchange rate linked loan agreements. Implementation according to the Act on Interest and Indexation therefore represents a compromise: it offers borrowers a more advantageous result than under the original loan agreements while protecting both the public interest and the interests of all debtors and taxpayers, who would have to bear the expense if the most extreme demands of some groups were to be met. The main point is, however, that this approach is enshrined in the law, in the opinion of the supervisory bodies concerned, and is necessary in order to preserve financial stability. BIS Review 91/2010  1  Risk is always present in any nation’s financial system, and it can never be totally eliminated. Uncertainty about the interpretation of this Supreme Court decision represents substantial additional risk. The positive side of the situation is that supervisory bodies, the Government, and the legislature can limit this risk to a considerable extent if they respond appropriately.

There is no escaping the reality of this ongoing structural change if a country wants to maintain its competitiveness over the long term. There have also been increasing calls of late for free trade to be curbed because it is not ‘fair’ for certain countries. In this context, the concept of ‘fairness’ is applied in entirely different ways. It is used in assessing bilateral trading relationships, for example, or in connection with alleged violations of existing trade rules. I would like to briefly address both these aspects. It seems rather odd to insist that trade between two countries can only be regarded as fair if the bilateral balance of trade is in equilibrium. Trade between the actors in these countries is voluntary, and therefore only takes place if all of the participants stand to benefit from the exchange. Such trade is not a zero-sum game in which one side’s gain is the other side’s loss. The view that the trade balance between two countries should be in equilibrium ignores both the reality of global value chains and also the very essence of specialisation. Today semifinished products and intermediate inputs can move back and forward across national borders 3 4  Cf. Autor et al. (2016), for example. Cf. World Trade Organization (2017), for example. Page 3/9  many times before the end product is complete. Simply netting bilateral trade flows is no basis for judging whether trade is fair or not.