samchain/econo-pairs-v1 huggingface dataset:
But even making an adjustment for that, the rise in inflation breakevens is significant. Of course, if inflation at long horizons is not generally expected to increase as the forward rates at face value might indicate, why don’t some other investors with different risk appetites sell short the overpriced index-linked bond? One answer may be that there are significant market frictions. For example, trading long-horizon forward inflation requires an investment period of many years, over which market volatility must be endured, and most speculative players have significantly shorter investment horizons. Second, transaction costs (bid-offer) are typically higher in index-linked than conventional instruments, partly because the risks in holding inventory are not predictable and are not easily hedged. 2 It may be that, against the background of more volatile realised inflation over the past year the rise in breakeven inflation rates reflects an increase in inflation risk premia, the compensation required to bear unexpected changes in future inflation. And the marginal buyers of index-linked bonds (typically insurance companies and pension funds) have become more willing to pay a premium for these assets because they better match their liabilities. Rather like entering into an insurance contract, these investors may be willing to pay a higher price for index-linked securities because the payoffs may be received in states of the world when they are most valued.

The Bank of Albania is an active supporter of financial and economic integration, considering it as one of the most important pillars to release the potential of the economy and boost its resilience to shocks. 3. On the Memorandum All the above, underlines the great importance of our economic and financial cooperation with Turkey. This cooperation imposes even us – the policy makers – to intensify the exchange of information and opinions, and seek to promote the finding of common solutions to common challenges. In this spirit, the Bank of Albania and the Central Bank of the Republic of Turkey are signing today this Memorandum of Cooperation, which may be well considered as the coronation of the insofar cooperation, as well as of our efforts to continue with drafting the relevant institutional framework for clarifying the operational cooperation protocols, in a series of central bank fields. This memorandum elevates the relations between our two countries to a new dimension. It confirms the will to elevate the level of cooperation and consolidate the ties between the two countries, providing for both institutions the necessary space for the intensification of mutual exchange of information and expertise in various fields of central banking, such as: supervision, financial stability, research, and financial education, and the regular dialogue at technical and political level. It is an important step for obtaining maximum benefits from the positive effects of integration and minimising the negative ones.
4. Similar platforms have proliferated around the world, but the trade finance gulf continues to widen. According to the Asian Development Bank, about 10% of global trade suffer from the trade financing gap.1 To put this into perspective, the value of the gap amounted to USD $ trillion in 2020, marking a 15% increase from just two years before. SMEs, in particular, accounted for an alarming 40% of rejected trade finance requests. These figures illustrated that global efforts are nowhere near enough, and we should all rethink why the gap is continuing to widen, and how to make our efforts as effective as possible. 5. A recent report published with the support of Fung Business Intelligence suggested a possible reason: the various digital trade finance platforms mostly work independently and do not synergise with each other, resulting in what we call digital islands. It is as if we are all putting our heads down and concentrating on developing our own platforms, forgetting that it is equally important for the platforms to communicate and work with each other. As suggested in the report, interoperation between the platforms could help to further modernise the global trade finance ecosystem and close the gap. 6. The Commercial Data Interchange, also known as CDI, which the HKMA is building, is precisely designed with enhancing interoperability in mind. By way of introduction, CDI aims to enhance the sharing of commercial data. Currently, every time a bank wants to connect to a data provider, it has to set up a new, separate connection.

Eddie Yue: Connecting the digital islands - next steps in trade finance Opening remarks by Mr Eddie Yue, Chief Executive of the Hong Kong Monetary Authority, at the roundtable on “The Future of Trade Finance: Opportunities for Hong Kong, Asia and the World”, co-organised by the University of Hong Kong (HKU) Asia Global Institute & International Chamber of Commerce, Hong Kong, 26 January 2022. * * * 1. Good afternoon everyone. Thank you, Dr Fung, for inviting me to speak, and the HKMA is very pleased to support today’s event. It would have been a pleasure to meet you all in person, but I am thankful that this event could go ahead as planned. 2. Today’s topic is the future of trade finance, and I believe we all agree that, to elevate global trade finance to the next level, the recurring pain points of the existing trade finance system need to be fixed. The issues—including a paper-based system that is inefficient, prone to fraud and human error—have been discussed many times; so I believe by now, we all have a basic understanding of the problems. Indeed, various stakeholders, including the HKMA, have been attempting to solve the pain points by using emerging technologies. 3. For example, in 2018, the HKMA facilitated the launch of eTradeConnect, which is a blockchain-based platform that aims to digitise paper based documents and automate the trade finance process. The platform was subsequently connected to a similar platform built by the People’s Bank of China to facilitate cross-boundary trade finance processes.
2 General aspects of the European regulations  The European Union, as reflected in the FSB’s second Peer Review on Resolution Regimes published in 2016, is one of the jurisdictions where the Key Attributes have been most rigorously implemented. Allow me to highlight some of the main features. First, the regulations consider resolution as an alternative mechanism to ordinary insolvency procedures in the mercantile realm, applicable to banks only in specific circumstances pertaining to the public interest. In particular, resolution shall only be applicable to those banks whose failure may generate risks to financial stability, given that they perform critical functions. Second, the use of public funds to support vulnerable institutions is severely restricted. The contribution of any form of State aid – except that received in connection with a stress test – is understood to be a symptom of the institution’s non-viability and, therefore, it may precipitate resolution or, where appropriate, the liquidation in mercantile terms of the institution. Once the institution has been declared in resolution, the regulations require a bail-in for creditors. The ensuing assumption of losses must exceed a minimum amount equivalent to 8% of the bank’s liabilities as a prerequisite for attaining access to public funds, which includes the Single Resolution Fund. Lastly, so as to be able to carry out the bail-in, all institutions liable to be subject to resolution, i.e.

All told, institutions should be mindful that the new resolution framework will require those banks that exceed a certain size and are liable to generate systemic risk to ensure that their balance sheet structure allows their resolution at the expense, essentially, of their shareholders and creditors. They should, therefore, ensure that their business model is compatible with the issuance of loss-absorbing instruments on the capital markets and that their income statements allow for the remuneration of the supplementary risk that the new resolution regime entails for holders of bank debt. It thus seems likely that several institutions will face objective difficulties adjusting to the recently established resolution framework. These new regulations, therefore, contribute to reinforcing the perception of excess capacity in the sector and, foreseeably, they will contribute to promoting a change in the industry structure that will correct such excess by means of consolidation processes giving rise to banks more capable of comfortably complying with the new demands. The supervisor’s role essentially consists of setting in 9/10  place the means needed for this seemingly inevitable adjustment process to unfold in as orderly a fashion as possible. 10/10
Based on the analysis of these channels, the direct effects of the war on Spanish foreign trade are expected to be moderate, as its bilateral trade flows with Russia are relatively limited. Nevertheless, the indirect effects may be significant. Spain’s share of energy products imported from Russia is admittedly relatively small (6% of the total in 2019) and lower than that of countries such as Germany and Italy (17% and 22%, respectively). However, its high dependence on external energy sources and the impact of the war on energy prices on the international markets have already triggered a major negative shock to our international purchasing power. Given the crucial role of these commodities in production processes and the limited capacity in the short term to substitute these energy inputs from Russia, a hypothetical interruption of the supply of energy products from Russia to Europe would have a significant impact on activity and inflation in the euro area. That impact would be more pronounced in the economies that are more dependent on Russian gas, with the consequent indirect effects on the Spanish economy. The war has also adversely affected uncertainty, as shown by the fact that the decline in household confidence in March, after the conflict broke out, was the largest in the time series. 6  Consequently, a delay in the gradual recovery that was under way in the Spanish economy should be expected.

These short and medium-term challenges must not allow us to overlook the need to address the structural challenges that the banking sector was already facing before the onset of the pandemic and the Russian invasion of Ukraine. In particular, the need for capacity adjustment, as well as the growing competition from technology firms and the potential negative effects associated with climate risks. Lastly, crypto-assets, which are digital representations of value and rights based on distributed ledger technology, are an area of financial innovation that is growing fast. Despite their potential for offering lower transaction costs, greater interoperability and greater competition, and although they are still small and their degree of interconnectedness with the more traditional financial markets is still limited, their rapid development poses significant risks if it is not conducted safely within a regulatory framework that will mitigate the potential risks. These notably include market, liquidity, operational, reputational and, above all, conduct risks vis-à-vis users owing to the lack of transparency and regulation in this field. Bear in mind that an upscale in these markets could pose systemic risks. Therefore, as a matter of urgency and in coordination with the international community, a regulatory framework should be designed that allows us to mitigate and supervise these risks. Conclusion I will finish by recalling that the Spanish economy is immersed in a highly uncertain environment, the structural challenges ahead are enormous, and that the fact that these challenges are closely interconnected signifies that a comprehensive strategy of ambitious and lasting reforms is required.
At the same time, business start-ups remain at a record level, at over 400,000 excluding microentrepreneurs. Similarly, we do not have any general concerns about the reimbursement of SGLs. Since February 2022, we have received 671 requests, covering less than 0.1% of the total number of SGLs. Of the EUR 143 billion that have helped close to 700,000 businesses, EUR 46 billion have already been repaid. And today, over 95% of businesses are repaying their SGL correctly. The Banque de France's Credit Mediation remains mobilised in each of your départements to address the most difficult cases, within the framework of the "local agreement" renewed for 2023. Regarding households, growth in housing loans still amounted to +5.3% in December (and +5.1% in January) in the context of a gradual rise in the average rate, which then stood at 2.05%,2 compared with 2.9% on average in the euro area and 3.5% in Germany. In France, housing credit remains the cheapest,  1 2  Business failures | Banque de France (banque-france.fr) Excl. fees and insurance; Loans to individuals — December 2022, Banque de France, 3 February 2023  Page 4 sur 5 most abundant and safest in Europe - with 97% of outstanding loans at fixed rates. Source: ECB Of course, we have come out of the years of exceptionally easy credit. Nevertheless, the financing needs of the real economy are still largely met, thanks to the soundness of French banks.

Spreads and volatility have also been lower for longer, although there is some market discrimination between agents and between emerging market economies (EMEs), as well as periodic spikes in volatility, especially recently. Next, why are inflation or interest rates so low and how does this impact policy? First puzzle: inflation remains low in countries where unemployment is close to the NAIRU, like the USA, or where the output gap has been sharply reduced, like Germany; this may imply that the Phillips curve has a lower slope too. Yet, various studies by the IMF or the BDF show that, even if slopes have tended to flatten since the early 1990s, there has been no clear-cut change over the last years. BIS central bankers’ speeches  1  There are two possible explanations. The benign one is that transitory disinflationary shocks, e.g. due to commodity prices, temporarily shift the Phillips curve downwards. The worrying one would be a disanchoring of long-term inflation expectations, threatening the objective of price stability; such a disanchoring is suggested by the surprising correlation between spot oil prices and market expectations derived from inflation-linked swaps up to 5 years in 5 years. People can reasonably differ in their interpretation; hence the scope for healthy policy debates. As regards low policy or market rates, these are mainly seen as reflecting lower equilibrium, or neutral, interest rates. This leads us to the second puzzle: does the lower neutral interest rate result from cyclical or structural factors?
In our forthcoming report for 2021, which will be published in the next few weeks, we have sought to build on last year’s content to provide additional context and analysis. In March last year, I outlined our intention to assess ways that our holdings of corporate bonds could be adjusted to take the climate impact of issuers into account whilst still meeting our monetary policy objectives.9 Last month we set out in a Discussion Paper our proposals for ‘greening’ our Corporate Bond Purchase Scheme (CBPS).10 There is no template for a comprehensive framework for greening an asset portfolio held for monetary policy purposes. We know that outreach and engagement is  See The Bank of England’s climate-related financial disclosure 2020, Bank of England, June 2020 See Appointment of Andrew Bailey as Governor of the Bank of England, March 2020 10 See ‘It’s not easy being green – but that shouldn’t stop us: how central banks can use their monetary policy portfolios to support orderly transition to net zero’ speech by Andrew Hauser and Options for greening the Bank of England’s Corporate Bond Purchase Scheme, Bank of England, May 2021 8 9  5  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  5  critical in getting this right, and so are currently seeking feedback on our proposed framework. We are keen to hear from a range of experts and stakeholders over the coming weeks to inform our next steps. The need for us to act in this space was clear and unambiguous.

In addition, this year COP26 has an ambitious agenda that spans all of the areas that I have spoken about today – in particular establishing a better understanding of best practice, and fostering greater technical cooperation. The Glasgow Financial Alliance for Net Zero (GFANZ)12 initiative will do this by bringing together over 160 firms (responsible for assets in excess of $ trillion) for the first time. Such technical collaboration and cooperation is no less important among central banks and supervisors. The NGFS with the scope of its membership is key to that exchange of knowledge. The Bank has widely shared what we have learnt and we will continue to do so.13 The creation of the Central Banks’ and Supervisors’ Climate Training Alliance (CTA) will also further support technical cooperation and assistance on climate risks. Let me conclude. In spite of the Covid-19 pandemic, central banks have continued to make progress in responding to climate change, but we know there is still work to be done. The next stage of our journey will require us to deepen our analysis, evolve our approaches and further our collaboration. The coming year will be critical for all of us on this journey – in allowing us to better convert climate change risks into something that we can tackle for real. 12 13  See New Financial Alliance for Net Zero Emissions Launches, UNFCCC, April 2021 See Centre for Central Banking Studies, Bank of England 7  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  7
For the first time in two years the median price for houses has fallen, according to Swedbank’s Boindex. Moreover, the rate of increase in household borrowing from mortgage institutions is now slightly lower than it was in the spring. Of course, it is impossible to draw any far-reaching conclusions solely on the basis of these observations. However, we will make a thorough assessment of the situation later in the autumn when we publish our twice-yearly Financial Stability Report. Summary and conclusion Let me briefly summarise my message today. •  We have raised the repo rate four times this year and my assessment is that it is reasonable to assume that further increases will be necessary. This will ensure that inflation is close to the target and that developments in the real economy are balanced. •  Our focus is on the inflation target and the central aim is, as before, to anchor inflation expectations in the economy around this target. When we formulate our monetary policy we also give consideration to the way the rest of the economy is developing. You can read more about this in our recently published strategy document “Monetary policy in Sweden”, which can be ordered from our Communications Secretariat. It can also be downloaded from our website and is available in both Swedish and English. •  The social partners can sign new agreements based on the assumption that the Riksbank’s inflation target stands firm.

Judging from the surveys we make of inflation expectations, monetary policy in this respect has a very high level of credibility. •  The Riksbank also has the task of safeguarding financial stability. We see no problems with regard to financial stability at present. The fact that we emphasise developments in house prices and indebtedness does not concern financial stability. It is because we are concerned over how future inflation and growth might be affected by a possible sudden correction in house prices. Finally, I would like to stress that the monetary policy framework has functioned well. This is indicated in particular by the fact that inflation expectations are firmly anchored around two per cent. There are no signs in the financial markets that monetary policy is regarded as unclear. However, this does not mean we can rest on our laurels. We have one of the most open and transparent central banks in the world and we wish this to continue. The Riksbank’s forecasts assume, as I mentioned earlier, that the repo rate will develop in line with market expectations. I have raised the question of possibly going one stage further and instead reporting the Riksbank’s own forecast of interest rate developments, as they do in, for instance, Norway and New Zealand. Personally, I see it as quite natural that we should make forecasts of repo rate developments in the same way that we forecast a number of other variables.
Subsidiarisation of systemically-important foreign banks Local banks are required to maintain a minimum of $ in paid-up capital and meet MAS' capital adequacy ratio requirements to ensure that they have adequate resources to support and expand their operations. MAS’ requirement of a minimum of 8 percent Tier I capital and 12 percent Tier I plus Tier II capital exceeds the international standards set by the Basel Capital Accord. However, QFBs and foreign banks can operate as branches, and accept retail deposits without any paid-up capital in Singapore. This has led local banks to complain that the playing field was tilted against them. It was tenable in the past when individual foreign banks had a small share of the domestic market and we placed greater reliance on the home supervisor. But as we open up further, we need to make sure that the prudential safeguards that apply to foreign banks are commensurate with their increased role in the retail deposit market. MAS is considering requiring systemically-important foreign banks with a large retail presence to subsidiarise their operations in Singapore. This means that the foreign bank will have to incorporate in Singapore and meet MAS' minimum paid-up capital of $ as well as MAS’ CAR requirements. Subsidiarisation will provide greater clarity and certainty in supervision. A subsidiary is a separate legal entity from the parent. It will have its own assets and will have to maintain its own capital.

Local banks' upgrading and consolidation Since the first liberalisation package was announced, the local banks have made progress in building up their capabilities. They have generally strengthened their management teams, and invested heavily in infrastructure to provide banking services more efficiently, especially via electronic channels. They have improved their customer relationship management systems, which will allow more effective data mining of their customer databases and cross-selling of multi-sector products. Local banks have also been seeking opportunities and expanding their presence in the region. An important and more visible sign that local banks are gearing up for competition is of course the process of consolidation that is underway. The opening gambit was made on 12 June when OCBC announced that it was making a voluntary general offer for Keppel Capital Holdings which owns Keppel TatLee Bank. Ten days later, DBS made an unsolicited bid for OUB. And just three hours ago, UOB made a competing bid after reaching agreement with the controlling shareholders of OUB. All the local banks are now busy reassessing their positions. It is likely that a new configuration will quickly crystallise. MAS views this as a very positive development for the banking industry, and more importantly for Singapore. If the consolidation is well executed, a stronger group of local banks will emerge, able to hold their own domestically, provide Singaporeans with better services, and compete in the region. Let me elaborate. The importance of consolidation Economies of scale have become critical in banking today.