samchain/econo-pairs-v1 huggingface dataset:
Indeed, the experience of countries such as Greece, Spain and Portugal confirms that a key element of their successful entry into the euro area was their success in controlling sources of inflation other than the Balassa-Samuelson effect. In particular, a balanced monetary and fiscal policy mix and the control of real wage increases have supported the disinflation process in these countries, and allowed them to advance in the process of nominal convergence without compromising the gradual catching-up in real incomes. 3. Monetary policy and exchange rate strategies  With regard to monetary policy and exchange rate strategies, most accession countries have already indicated their intention to join ERM II as early as possible after entry into the EU. The accession countries have also signalled their intention to adopt the euro as soon as possible, that is, after two years of ERM II membership. 2  BIS Review 92/2001  The whole issue of the timing of ERM II membership, both as to when to join and how long to remain in the system, is dependent on a somewhat more complex question, namely whether the discipline which ERM II imposes on its members is advantageous for the accession countries. The answer, in our view, is “yes”. Ladies and gentlemen, allow me to reflect on this question for a moment and explain why we hold this view. Being small open economies, most accession countries cannot disregard exchange rate developments when making their monetary policy decisions.

Given the major implications that the structure and functioning of the financial sector may have for macroeconomic developments, a strengthening of the accession countries' financial markets, including the enhancement of legal frameworks and prudential supervision, is needed. The principal reasons for this are twofold. First, the weakness of the financial sector has been partly responsible for the relatively modest growth rates observed in some accession countries during the last decade. In spite of substantial structural reforms in the real sector of the economy, the as yet insufficient development of the financial sectors may have made the transition to a fully functioning market economy more costly in many accession countries. Financial sector development is, therefore, crucial if potential economic growth is to be increased and real incomes are to catch up with those of the euro area. Second, financial stability in the accession countries is of great relevance to the ECB, since it is a central aspect of ensuring the smooth conduct of monetary policy in an enlarged euro area. Financial sector vulnerabilities have to be avoided as they may complicate the efficient working of the monetary policy transmission mechanism. They may also pose great challenges for the conduct of monetary policy, for central banks' credibility and for the maintenance of price stability. Finally, accession countries have embarked on the process of developing a modern financial market infrastructure.
If financial resilience is to keep pace with the changing system, regulations must serve not just conduct of business and market integrity, they must also be prudent from a macro perspective. The growing non-bank system must be able to serve the wider economy not just in the good times, but also in the bad. See, for example, Xiaoxia Lou and Albert Y. Wang, ‘Flow-Induced Trading Pressure and Corporate Investment’, Journal of Financial and Quantitative Analysis, February 2018. 18 FSB, ‘Policy Recommendations to Address Structural Vulnerabilities from Asset Management Activities’, January 2017. To operationalise some of the FSB recommendations, the IOSCO, the international body of securities regulators, in 2018 issued recommendations and good practices to improve liquidity risk management for investment funds – see ‘IOSCO issues recommendations and good practices to improve liquidity risk management for investment funds’, media release, February 2018. 19 See the FCA’s Business Plan 2019/20 and ‘Consultation on illiquid assets and open‑ended funds and feedback to Discussion Paper DP17/1’, Consultation Paper CP18/27, October 2018. 17  19  All speeches are available online at www.bankofengland.co.uk/news/speeches  19  Conclusion  Macroprudential may no longer be the buzz phrase it was a decade ago. But its objective of promoting a financial system that can serve households and businesses in bad times as well as good remains as important as ever. The avoidable damage caused by the economic tremors of 2008 is a salutary reminder of the costs a fragile financial system can impose on an economy.

Allow me to thank you once again for the work and devotion you exhibited over the course of this year. I strongly believe that the truthfulness and objectivity in reporting economic and financial news will continue to accompany you in fulfilling your duty in the coming year. I reaffirm that the Bank of Albania will continue be a transparent institution, ready to provide opinions and assessments as necessary in all public debates related to the performance of our economy and financial markets. A certificate of this commitment and achievement of the Bank of Albania in the communication with the public is the ranking first of the Bank of Albania among all the banks of Central, Eastern and South-eastern countries, for very active pubic communication, 1/2  BIS central bankers' speeches  in the last report: “Focus on the European Economic Integration” for the second quarter of 2021, published by the National Bank of Austria. Dear guests, The Bank of Albania continues to focus scrupulously on financial education and research considering it a crucial pillar of its activity. They are seen as the foundations for increasing the social-economic development and welfare of the citizens of Albania. From this point of view, I kindly invite you to share together a special moment of this meeting: the traditional ceremony for the Governor’s Award for the Best Diploma. The Bank of Albania for this 15th year ceremony in a raw has selected and valued three scientific works amid all the presented researches by students graduated in Albanian and abroad.
To complete this list of policy challenges that are important to U.S. competitiveness, let me conclude with a few brief points on the broader imperatives of macroeconomic policy. The United States faces very substantial gaps between our fiscal resources and our expenditure commitments. The size of these gaps, these deficits, have been masked in recent years by a substantial, unanticipated and probably transitory surge in revenues, and by an unusually long period of unusually low long-term interest rates, in part the consequence of foreign official capital flows. But these gaps remain substantial and the U.S. fiscal position is unsustainable. Time does not help. We are going to have to begin to develop a political consensus on the mix of policy changes that can bring our commitment and resources more into balance, if we are to preserve confidence in our market and our long-term economic prospects. One of the most important roles for public policy is the maintenance of a stable macroeconomic framework that enables firms to make long-term investment decisions. In this sense, the fiscal policy choices ahead for this country will be critically important to the overall environment in which U.S. enterprises operate. The business community will play an important role in shaping the policy response to these longer-term economic challenges. These reforms will have a long fuse. The benefits will be shared broadly, rather than captured specifically by particular sectors of the economy.

We will benefit from more rapid growth in the rest of the world, but at the same time we need to be more attentive to addressing a range of challenges that could ultimately damage the prospect for future growth in living standards here at home. I want to talk about challenges we face in four areas: •  sustaining support for global economic integration,  •  the role of public policy in education and other areas that are critical to our capacity to adapt to change,  •  regulation and the role of the market, and  •  macroeconomic policy. Let me start with openness. The pressures that have come with globalization and technological change have led many to suggest that we should become less open as a country, that we should slow the pace of integration, or that we should provide greater insulation or protection from competition for selective parts of the U.S. economy. Moving in this direction would, I believe, be a fundamental mistake. More than ever before our fortunes are linked to those of the global economy. If anything, we need to become more open, not less; more open to trade in goods and services, but also to investment, to people and to ideas.
However, a different number of borrowers may actually receive loans than were assumed when the originator sold the forward TBA contracts, a condition that could result in a different amount of gross issuance than initially expected. Given the uncertainty around agency MBS issuance, at times we adjust our purchases when market functioning indicators suggest that particular securities are less readily available for  9  This extra 25 basis points is called “excess servicing”. 10  For more information on mortgage origination process and the relationship between primary mortgage rates and yields on agency MBS, see Fuster et al (2012). 11  Originators can also choose to originate in lower coupons by retaining more “servicing”, or in a higher coupon – by paying the agency guarantee fee up front, as long as the coupon provides for the originator to still retain 25 basis points required to service the loans. 12  Purchasing non-production coupons could also have an impact on the primary mortgage rate. Purchases of non-production coupons could increase the value of those securities relative to production coupons. This may prompt investors to rebalance their portfolios by shifting their positions into the relatively undervalued production coupons, lowering yields on the production coupon relative to where it would otherwise be. 13  An increase in interest rates may result in origination activity migrating to higher coupon agency MBS.

With this strict definition in mind, I will make four main observations. An asymmetric world First, the current world is highly asymmetric. Two major currencies – the US dollar and the Euro – account for most of the foreign exchange reserves. One of them, the dollar, clearly dominates in financial markets and payment systems. This asymmetry has many well-known and self-reinforcing consequences. US monetary policy has significant effects well beyond the US economy. Those monetary spillovers may be especially important when unconventional monetary policies are implemented. They cast new doubts on the insulating properties of floating exchange rates. BIS central bankers’ speeches  1  They create new incentives, for many emerging economies, to manage their exchange rate and, for that purpose, accumulate dollar-denominated foreign exchange reserves. As a consequence, most, but not all, of the official liquidity provided through multilateral mechanisms is denominated in dollars. The rise of the euro The major innovation of the last decade has been the rise of the euro. It offers some interesting insights and lessons. Most economic models and historical examples suggest that the appearance of new world currencies would trigger huge portfolio adjustments and create major turbulences. Economists also hypothesized that, in a multicurrency world, portfolio shifts would create permanent exchange rate instability. None of this has happened. In fact, the euro has neither stabilized nor disrupted the international monetary system. Exchange rates have moved significantly but, most of the time, in an orderly fashion and have followed low periodicity cycles.
The FSB Roadmap is here: Enhancing Cross-border Payments: Stage 3 roadmap (fsb.org) . Further detail on the Bank’s Renewed RTGS service in the context of cross border payments can be found here: Victoria Cleland: Rowing in unison to enhance cross-border payments (bis.org) 7. the World Bank has published figures indicating that banks in Asia budget USD1.5bn annually for this and globally the cost on firms is significant. 8. in India the introduction of a digital identity system reduced the cost of KYC verification from USD5 to USD0.70 for each customer. 9. G20 Roadmap for Enhancing Cross-border Payments: First consolidated progress report (fsb.org) 10. Machine learning in UK financial services (bankofengland.co.uk) 11. The AI Public-Private Forum: Final report | Bank of England 12. Further detail on the use of Market Intelligence in the MPC and FPC is set out here: Navigating market signals: MaPS for policy makers – remarks by Andrea Rosen | Bank of England

Large current account imbalances, in particular deficits, pose significant risks for external debt sustainability and raise the possibility of sudden stops.6 Gross positions are now 3 to 4 times larger than their 1995 level, ranging from 150–300% of GDP (150% in the case of the US and 300% in the case of France, for example). Net positions are considerably smaller [Slide 8, table on right-hand side], but have widened by a factor of 5 to 10 with respect to their level in 1995. The counterpart of persistently large current account imbalances is large net external asset positions [as already shown in Slide 3], but also continued accumulation of external assets and liabilities. In this respect, the composition of the financial account (FDI, equity and debt portfolio flows as well as the other investment category, which largely comprises banking flows) matters. Examining the different financial instruments, one notices that the volatility in overall flows is largely driven by banking flows [Slide 9]. Given the large pre-crisis expansion in cross-border banking flows, especially within the euro area, the “low” level observed in recent years could 2/5  BIS central bankers' speeches  simply be interpreted as a return to normal. Indeed, in the aftermath of the Great Financial Crisis, banking flows retrenched the most, followed by debt portfolio flows.7 Portfolio equity flows have been much more resilient than debt flows, which have halved between the pre- and the postcrisis periods.
There are no easy or quick answers to the problems we are facing - and I'm tempted to say that if anyone thinks that there are then they probably don't understand the questions! But I am confident that persisting in our parallel attempts to maintain macroeconomic stability in our respective currency areas provides the best way forward for the world economy as a whole. But it may be a somewhat bumpy road. BIS Review 76/2001  5

  Longer-term work to assess what monetary policy framework is most consistent with the goals of monetary policy and financial stability. New York Fed economists have made many contributions to the theory and measurement in New Keynesian models, focusing on monetary policy at the zero lower bound, and incorporating financial frictions into more standard macro models. 2  Dynamic stochastic general equilibrium (DSGE). BIS central bankers’ speeches  3  Microeconomic and regional policy New York Fed economists also have important opportunities supporting microeconomic and regional policy. These include the survey of consumer expectations, which will launch this month, and the consumer credit panel, which, using raw data supplied by Equifax, allows us to develop insights into consumer indebtedness at the micro-level. These panels give us and the public unique insights into household beliefs and behavior. One example is the work highlighting the growing aggregate student loan debt balance and repayment burden. An important responsibility for each of the Reserve Banks is coverage of economic development in its region. A significant aspect of this work at the New York Fed involves our regional press briefings, business surveys, and white papers. One notable example has been the New York Fed economists’ work in developing a white paper that highlighted some key choices that Puerto Rican policymakers might make to eliminate structural constraints that have impinged on the Island’s economic performance. I’m very pleased by the contributions of our economists in the Bank, whether they sit in the Research Group or elsewhere in the Bank.
What I intend to do this afternoon is first to define what international monetary co-operation is about, and in this connection, survey the attitudes of the parties that should have an interest in such co-operation and discuss the form of this co-operation. I wish to point out that these attitudes have, perhaps unintentionally, led to international monetary co-operation being regionalized. I shall then focus specifically on Asian monetary co-operation, covering the history, or the lack of it, and the monetary problems, current and potential ones, that Asian economies face. I shall then make a case for much greater monetary co-operation in Asia. I shall also suggest a way forward for Asian monetary co-operation, with a strategy and a list of issues to be addressed in such co-operation. Monetary Co-operation 4. Let me start now by attempting a definition on what monetary co-operation is about. The Oxford Dictionary defines “co-operation” as “working together to the same end”. So I suppose monetary co-operation can simply be defined as working together to the same monetary end. This then leads to the questions as to what that same monetary end should be, who should be working together and the form in which they should best work together, particularly when one is talking about monetary co-operation across monetary systems on a global or regional dimension. 5. The Articles of Agreement of the IMF provide some guidance on what that same monetary end should be.

As Asian economies gradually opened their markets to international trade and competition, with Hong Kong setting a good example of how free markets work, the existence of stable exchange rates, largely linked to the US dollar, formed the anchor of Asian growth. The need for monetary co-operation amongst Asian economies, therefore, did not matter much as long as each traded mainly with Europe or America using the US dollar as the main currency of trade. 16. This was the reason why the work of the principal forum for central bank discussions in the late 1950s called SEANZA (South East Asia, New Zealand and Australia) focused mainly at providing training for central bankers. The 18 members of this group cover a geographical area that spans the whole of Asia-Pacific from India to New Zealand. Training and research was also the primary focus of another central bank forum founded in 1966. This is SEACEN (Southeast Asian Central Banks), comprising ten central bank members with a research and training centre in Kuala Lumpur. 17. In the 1990s, the number of Asia Pacific groupings increased, partly as a result of accelerating intra-regional trade. The establishment of APEC (Asia Pacific Economic Co-operation) in 1989 promoted trade and investment amongst the 18 member economies, but there were only ancillary discussions on monetary co-operation. In February 1991, nevertheless, Asian monetary co-operation took a quiet but significant step forward with the creation of EMEAP (Executives’ Meeting of East Asia Pacific Central Banks).
4  BIS Review 70/2001  The Bank of Thailand has announced new rules for the Internet banking – simply what can be done over the counter, will be allowed over the Internet. This should facilitate development of financial products in this area. ·  And for the alternate forms of financial intermediaries, capital market, bond market, and equity market will play a greater role in the future. They will help increase the efficiency of our banks’ operations by providing new instruments to help manage, mitigate and repackage risks. ·  The second agenda of the financial sector reform is enhancing our risk management capacity, particularly of the Thai regulatory bodies and financial institutions. On this front, our Supervision Group have moved from regulation and transaction-testing toward riskbased supervision early this year. ·  From our preliminary assessment, these changes have fostered corresponding and encouraging changes in the Thai financial institutions. Several have hired foreign consultants to transfer the know-how and adopted the best international practices on risk management, while many have imported several standard off-the-shelves risk management software to help improve their current practices. Of course, there remain several impediments to change; these include scarce and expensive human resource in this particular field, and it is even more difficult to re-engineer the business process to ensure that such resources are employed productively. ·  The New Accord is a major challenge and milestone in this area.

A key challenge confronting macroeconomic policy in Thailand is to safeguard the pace of recovery while maintaining macroeconomic stability and financial discipline, and at the same time continuing with the essential reforms. Past records Before moving on to discuss the challenges facing Thai monetary policy, I would like to review some of the notable progress of the last few years. There have been gains that should further be expanded. Macroeconomic and financial stability has been restored. Inflation remains low and stable. Thailand’s international reserve position is healthy. Surpluses in the external current account of these few years have been matched almost entirely by falls in external debt, especially short-term debt. Such reversed flows have been instrumental in avoiding a real currency appreciation and loss of competitiveness. BIS Review 70/2001  1  The surplus on the external current account is expected to continue this year, although at a somewhat lower level. This would allow the debt stock to fall further as scheduled repayments are made. About 50 percent of the existing non-bank private debt stock represents debt contracted after the crisis, including some rollovers which were done under new contract. This means that private sector in Thailand currently has no difficulties in gaining access to the international financial markets. Reflecting this, the spreads of Thai Government bond yields over US Treasuries have narrowed while Thailand’s sovereignty credit ratings remain stable. The financial system has now stabilized, but much work still lies ahead.