samchain/econo-pairs-v1 huggingface dataset:
The success of the principle-based approach to regulation will depend on the ability of banking institutions, individually and collectively as an industry, to make use of the flexibilities given without giving rise to excessive risk taking, overpricing, credit rationing and other actions that could threaten stability in the financial system and overall economic well-being of the nation. The key is for banking institutions to act responsibly, as the actions of banking institutions would have implications on all segments of the economy. Due attention must be given to ensure that all segments of the society have access to banking services at reasonable cost and no groups should be marginalised in this process. In this respect, while we advocate a principle-based regulatory framework, Bank Negara Malaysia will closely monitor the performance and actions of banking institutions, and would intervene and prescribe specific regulations in the event that actions by banking institutions could jeopardise financial stability and public confidence in the financial system. As a custodian of public funds, and as a service-oriented industry, the banking sector must continuously strive to maintain public confidence in the system and deliver high standards of services. Maintaining public confidence entails efforts beyond maintaining strong financial results and having a wide range of products and services for customers. As customers become more financially savvy and better informed of their rights, the conduct and practices of banking institutions will increasingly be scrutinised by the public.

3/4  BIS central bankers' speeches  As Stefan Ingves once told me, ultimately, it is not even a monetary question but a political one. For whatever we decide, it must have the “consent of the people”. The future of money is too important a matter to be left entirely to central bankers. 4/4  BIS central bankers' speeches
I refer here to the lag before the ‘peak effect’ as a shorthand for estimate of transmission lags. Transmission comes via distributed lags over a period of time. 6. A research programme is currently underway at the Bank to assess the length of transmission lags. Given that Bank Rate has been at or near its effective lower bound for most of the past 15 years (and has changed little through time as a result), a re-exploration of transmission from Bank Rate innovations to CPI inflation is both now possible and overdue. 7. For an analysis of this form on US inflation, see Cogley T. and T.J. Sargent (2001). ‘Evolving post-World War II US inflation dynamics,’ NBER Macroeconomics Annual 16, MIT Press. 8. For a deeper discussion of these definitional issues, see the analysis presented in Altissimo, F., M. Ehrmann and F. Smets (2006). ‘Inflation persistence and price-setting behaviour in the euro area,’ ECB occasional paper no. 46, which draws on the analytical framework underlying the substantial body of research undertaken as part of the ESCB’s Inflation Persistence Network in the early 2000s. 9. For example, see the discussion in chapter 3 of the MPC’s Monetary Policy Report - November 2022, entitled ‘The key factor’s affecting the MPC’s inflation projection.’ 10. The recent rise in food prices may also follow in part from the consequences of the Russian invasion of Ukraine and its implications for agricultural commodity markets in cereal and vegetable oils. 11.

3/4  BIS central bankers' speeches  After all, as moving forward requires the economy to consider not just cutting edge, but also bleeding edge ideas and technologies, we need to start thinking about novel and unconventional approaches. Several questions spring to mind. First, how should the government take calculated policy risks, while managing policy failures? In building pathways to high income, ambitious industrial policies, or “moonshot strategies”, will play a key role. With any policy however, there would be uncertainty and possibility of failure. Development economist, Dani Rodrick, called for effective industrial policy to be less on the ability to pick winners, but on knowing when to cut losses. Too low a failure rate could also mean that we are playing it too safe. The objective, hence, should not be to avoid mistakes, but to minimise the cost of mistakes. This will require the Government to build its capacity to account for and quantify the associated risk within the decision framework. Only then can we make smarter, more intelligent bets to get the most bang for the buck. Second, how can the Government learn and execute better? Focus should be as much on process and governance, as it is on the outcomes. While we have achieved leaps and bounds in economic development since our Independence, past reforms also provide important lessons in areas where we must strive to do better. We have had roughly 60-70 blueprints and masterplans over the years; not all have been executed to their maximum potential.
In retrospect, I can also state that this important move enabled the economy to face the emerging challenging times confidently, with the new inflows assisting the Government to maintain the growth momentum, while also allowing the Central Bank to maintain stability. One of the important lessons that we would take away from this case study is that the initiative was implemented as a result of the close harmonization between the MoF and the Central Bank. Had any one of the two agencies not fully supported this bold and imaginative move, the initiative would have failed, or worse still, been still-born. BIS central bankers’ speeches  7  Case Study 2: Debut International Sovereign Bond The second case study that I would describe this evening is the debut international sovereign bond of Sri Lanka, in 2007. Mr. Chairman, as you may recollect, by the second half of 2007, the country was fully engaged in the major humanitarian operation, while the global environment was becoming more and more unstable. The local environment was also tense, notwithstanding all efforts. Inflation was high; interest rates were high; the exchange rate was under threat; and the fiscal deficit was expanding rapidly, because of the ever increasing need for finances to fund the massive infrastructure development programme and to meet the costs of the humanitarian operation. To deal with this challenging situation, the MoF and the CB decided that it was vital that a further sizeable injection of long term foreign funds was given to the economy.

It is of course obvious that this paradox is not unintentional, and has, in fact, been carefully thought through and deliberately introduced, and has obviously been done in order to establish an extremely vital and far reaching principle. That is, the need for the Central Bank to retain intellectual and operational independence, but to temper it with the pragmatism of the national deliverables of the economic agenda that has been decided by a democratically elected government. Going further, Exter’s comment that “the effectiveness of this cooperation and coordination between the Board and the Government will depend more upon the men occupying the key positions at particular times, than upon any legal formula”, emphasizes the complexity and the delicateness of the relationship, which he has described in lucid and clever language. Mr. Chairman, All these positions that I described to you now highlight another very important fundamental principle that was set out in Exter’s Central Bank Report of 1949. That is, Exter’s wise words that “good central banking is less good law than good practice”. After 7 years as the Governor, I can tell you that that is one of the wisest comments in the Exter Report, and an appreciation of that principle must be understood by all stakeholders, especially at the current turbulent times, when Sri Lanka is on a fast track to economic development. In fact, over the past several decades, monetary policy objectives, instruments and operating mechanisms have changed significantly.
The FSB has identified a similar menu of tools under its Misconduct Action Plan, which its members can draw from. Thus far, however, action to promote good conduct has varied widely across the G20.25 The FSB’s compensation standards have been written into G20 regulatory rules, but not yet fully deployed.26 Although adjusting in-year pay is common, clawing back bonuses later on is not, even though it typically takes several years for evidence of misconduct to emerge. And few jurisdictions have put in place either formal mechanisms to ensure that boards and senior managers are explicitly responsible and accountable for what happens at their regulated firms or regulatory references to stop those with poor conduct records moving from firm to firm. 20  Fair and Effective Markets Review Final Report, HM Treasury, Bank of England and FCA (June 2015). PRA Supervisory Statement | SS28/15 Strengthening individual accountability in banking, May 2017. 22 FX Global Code (2018). 23 FMSB stands for Fixed Income, Currencies and Commodities Markets Standards Board. See Carney (2017), Turning back the tide. 24 Allen, T., (Q3 2018), Strengthening the link between seniority and accountability: the Senior Managers and Certification Regime, Bank of England Quarterly Bulletin 25 FSB (April 2018), Strengthening Governance Frameworks to Mitigate Misconduct Risk: A Toolkit for Firms and Supervisors. 26 FSB, (2017), Implementing the Principles for Sound Compensation Practices and their Implementation Standards, Fifth Progress Report.

Not that I want to defend the past economic regime in any way, of course, but let’s not forget that it had elements which can be traced back at least implicitly to the pre-war period. An explicit return to the three traditions I mentioned is the central feature of our post-1989 economic history. Many of us clearly remember that the liberalisation of prices and foreign trade in 1991 was accompanied by effective stabilisation measures. These included an appropriate devaluation of the koruna against a basket of currencies and the maintenance of balanced budgets or even slight surpluses. It is therefore no accident that in 1991 inflation was “only” 56% here, as compared to triple figures in Poland and often quadruple figures in other transforming 1/2  BIS central bankers' speeches  economies. The Czech National Bank embraced the legacy of price stability right from its establishment in 1993. The maintenance of a fixed exchange rate until 1997 was a condition for attaining singledigit inflation and provided a fixed point in the unstable transformation environment. The switch to inflation targeting in 1998 marked the start of a roughly ten-year transition to price stability according to the definition long applied in advanced market economies. Maintaining price stability is not just our constitutional duty, but a long-standing legacy that we proudly embrace. The second feature of our economic history that I mentioned at the start is an ability to cope with the consequences of the struggle for economic independence.
In time, several aspects of transition differed from one country to another: smaller countries, such as the Baltic states or Slovenia and Slovakia, opted for a fast track towards Eurozone entry, inter alia because of geopolitical and security reasons, while states with larger and more complex economies, such as Poland, Hungary, Czechia or Romania, focused their efforts more on internal development. For instance, in Poland there is talk of “Polish-ization” and “nationalisation” of development, the spotlight being on the requirement to increase the country’s power resources: “if you cannot stand on your own feet, no one will listen to you”. In Romania, we had a very difficult transition in the first post-communist decade, with half-hearted, gradual reform, yet after 2000 our economy has evolved more coherently, having two important anchors: the EU and NATO. Events that were hard to foresee in the early ’90s took place as well. For instance, who would have thought that Slovakia, the less developed part of Czechoslovakia, would join the euro area and Czechia would not? Under the circumstances, does euro adoption testify to a high development level?

But at the same time, the model of ecosystem creation that currently dominates can lead to the monopolisation of the market, and in the end (like any monopoly, no matter how effectively it started out), it can lead to stagnation in the technology market in the long term, and a slowdown in the introduction of innovations, which threatens consumer interests. And, of course, straight away there is a collateral risk that we have to learn to manage: that large amounts of sensitive data (payment, medical and other data) from all spheres of our citizens’ lives are gathered by one system. That is why we as the Central Bank would like to see healthy competition between a number of players. The conditions of access to emerging ecosystems should be completely open, nondiscriminatory to all suppliers, and consumers should be able to choose the most appropriate products and services for them. Meanwhile, “external” ecosystem participants will also have to comply with certain rules and ecosystem requirements — both in line with rules pertaining to sales and high requirements for cyber resilience. Regulating emerging ecosystems is, of course, a very difficult task. But we need this regulation to avoid the risks I mentioned and to develop the benefits that ecosystems offer, which includes safeguarding the potential for small players to develop. Therefore, we propose working with the market to develop approaches to ecosystem regulation. We have established a working group at the Bank of Russia and will soon publish the first consultation paper on this topic.
This is particularly the case for prices for domestically produced goods influenced by world market prices. The fall in prices for imported consumer goods is not solely attributable to exchange rate developments. Clothing prices have exhibited a falling trend over the past few years. In October 2003, clothing prices were 13.7 per cent lower than in the same month one year earlier, and almost 30 per cent lower than in 1995. In addition to low external price inflation for these goods, lower tariffs for clothing have translated into lower consumer prices. The removal of quota regulations has also led to a shift in clothing imports away from high-cost countries to countries with considerably lower production costs. The same trend has been observed for the audiovisual industry. Since the mid-1990s, prices for audiovisual equipment have fallen markedly. In October, prices for these goods were 8.5 per cent lower than one year earlier. International producers have moved production to low-cost countries, allowing them to reduce prices charged to Norwegian importers. In addition, new technology and intensified international competition have exerted downward pressure on prices. Global economic growth has been considerably weaker than expected. Changes in the economic outlook are clearly reflected in interest rate expectations. In the US, these expectations have been adjusted downwards considerably since summer 2002. At that time, market participants expected the key rate in the US to be increased to about 4 per cent towards the end of 2003.

BIS central bankers’ speeches  7  Table 1 International baseline scenario assumptions 2014  2015 (e) Dec.15 Report  2016 (f) Dec.15 Report  Mar.16 Report  2017 (f) Dec.15 Report  Mar.16 Report  Mar.16 Report  Terms of trade Trading partners' GDP World GDP at PPP World GDP at market exchange rates Developed ec's GDP at PPP Emerging markets' GDP at PPP External prices (in $  -1.8 3.4 3.4 2.7 1.7 4.8 -0.9  -4.2 3.0 3.1 2.5 1.9 4.0 -9.3  -4.5 2.9 3.1 2.4 1.9 4.0 -9.7  -3.8 3.2 3.4 2.8 2.1 4.4 -2.8  -4.2 2.9 3.1 2.4 1.8 4.0 -5.8  1.7 3.3 3.5 2.9 2.2 4.6 1.5  0.7 3.1 3.3 2.7 1.9 4.5 1.0  LME copper price $ WTI oil price $ Brent oil price $ Gasoline parity price $ Libor $ (nominal, 90 days)  311 93 99 731 0.2  249 49 53 466 0.3  249 49 52 467 0.3  220 43 45 373 1.0  220 40 41 398 0.7  230 49 52 384 1.6  230 45 46 420 1.5  (e) Estimate. (f) Forecast. Source: Central Bank of Chile.
Users typically describe money as ‘good’ if it has a stable value over time, is broadly accepted, and enables efficient payments. Given these parameters, it seems unlikely that crypto tokens will be widely used as money in Switzerland. The picture may be different for stable coins, however. These are designed in such a way that they can potentially assume the characteristics of good money – for instance if they are pegged to stable, official currencies. In the simplest case, such an anchor would consist of a single currency. Let’s take an example: An issuer of stable coins in Swiss francs would typically pledge that his tokens are equal in value to Swiss franc cash. When it comes to classifying these kinds of stable coins, two important factors need to be taken into  Page 3/7  consideration. The first concerns the strength of such a pledge. Does the issuer explicitly commit to instantly and unconditionally converting the stable coins into Swiss franc cash at nominal value? Or is the pledge merely a statement of the issuer’s intention to keep the exchange value of his tokens stable against the Swiss franc? The second key point concerns the credibility of the pledge. In the case of a Swiss franc stable coin, the more extensively the issued tokens are backed by Swiss franc-denominated assets – and the more liquid and intrinsically valuable these assets are – the more credible the pledge will be.

Central banks' governors in Islamic countries, members of the Islamic Development Bank realized the importance of such consolidation 25 years ago when a technical committee was formed, including a number of governors and specialists, of which I was honored to be the chairman, to consider the needs of Shari'a compliant banking services. The most important recommendation was that Islamic banks must be subject to the same supervisory rules and requirements as those that govern conventional banks, with the necessary flexibility, taking into account their specific work methods and products so as not to isolate these banks from global financial markets. Encouraging Islamic banking institutions to integrate into global markets will push them forward to compete with all other financial institutions, stimulating them to innovate to meet the needs of corporate and individual customers, expand their scope and base of work, and not to be tied to a specified category of customers or specific markets. This will help them adapt with the requirements of the global financial system, provide them with necessary instruments, helping them develop and reinforce their structures, and facilitate their spread. BIS Review 14/2007  1  Dear Brothers Banking business, in all its types and forms, is not free from risks that pose a challenge to banks and supervisory authorities. In this context, Islamic banks, like their conventional counterparts, are financial institutions providing services to depositors and investors, on the one hand, and offer financing to companies, public sector and individuals, on the other.
Sustainable investing must go mainstream. In short, every financial decision must take climate change into account. Achieving that requires improvements on three Rs: reporting, risk management and return.   On reporting, TCFD standards must be enhanced to be as comparable, efficient and decision-useful as possible. And we need to develop pathways to mandatory climate disclosures.   To manage risks, disclosures need to go beyond the static to the strategic. We must assess the resilience of the core of the financial system to transition risks, including through stress testing. The Bank will publish a discussion paper on our planned climate stress test tomorrow and we look forward to taking this forward internationally through the Network for Greening the Financial System (NGFS).   On returns, asset managers and asset owners will increasingly have to assess the transition paths of their investments and report their impact to their clients. Our citizens need to be able to see whether their investments are consistent with the path to net zero. Central banks cannot stand on the side lines of this revolution. And with Benoit’s research and Christine’s leadership, I am confident that the ECB will be at the vanguard. Conclusion 8  All speeches are available online at www.bankofengland.co.uk/news/speeches  8  Benoît, on behalf of everyone here tonight, I’d like to thank you for your tremendous work at the ECB and as Chair of the CPMI. The flood of acclaim you’ve received is rightly bestowed.

Fortunately, the financial guillotine is not preordained, for Benoît did not spend his days in power as did Louis XV. Where the king grew idle, Benoît remained frenetic (189 public speeches during his eight years). Where the king was conservative, Benoît was radical. Where the king became nostalgic, Benoît always looked forward. If central banks are to rise to their challenges and serve our citizens, we will need to build on Benoît’s legacy. I. Improving market functioning Let me start with market functioning. Before the crisis, financial alchemy appeared to have sliced, diced and distributed risk to those who wanted it most. The revolutions in securitised and derivative finance were cheered on by policymakers who saw more markets as the solution to any market failures and who believed the lie that markets always clear. But of course markets always clear only in textbooks. In reality, people are irrational, economies are imperfect, and nature itself is unknowable. The pre-crisis system had merely spread risk, contingently and opaquely, in ways that often increased it. 2  All speeches are available online at www.bankofengland.co.uk/news/speeches  2  Once the crisis began, risk quickly concentrated on the balance sheets of intermediaries that were themselves capital constrained. And with the fates of borrowers and lenders tied together via hyper-globalised banks and markets, problems at the core spread violently to the periphery. The post-crisis response included major reforms to simplify markets and make them more robust.