samchain/econo-pairs-v1 huggingface dataset:
This last point is vital. Financial services is an industry where arbitraging rules and regulations is habitual, even addictive. Money is made this way. We have no desire unduly to suppress enterprise and innovation, but doing the right thing and preserving financial stability means accepting the spirit of the rules. This is not a small change. Let me give you one important example. The new Basel agreement emphasises loss-bearing capital – capital that can bear losses outside insolvency. It must stay that way, and not be chipped away under the banner of arbitrage masquerading as innovation. I have been asked a number of times in the last week whether I think that the new Basel agreement sets capital requirements high enough. My answer is that if the capital buffers are in future genuinely loss bearing capital with no tricky wrinkles, and we keep to this outcome, we have taken a good step forward. Sadly, that was not the case with Basel 1 in the late 1980s when I started out as a banking supervisor. The consultation document on regulatory reform in the UK published by the Government at the end of July emphasised the need for a judgement-focused approach by regulators “so that business models can be challenged, risks identified and actions taken to preserve stability”. What does this mean?

These are actually some of the recurrent criticisms I have heard about the Eurosystem’s monetary policy: too obscure, too narrow-focused, too late. Figure 3 displays a forward-looking Taylor-type rule for the ECB’s minimum bid rate. As an overall assessment, the Taylor-type rule closely matches Eurosystem’s monetary policy decisions. Under the proviso that this rule provides a good benchmark, it is quite unclear why the Eurosystem has attracted so much criticism: in particular, the output stabilisation “objective”, as encapsulated in a standard Taylor rule, has not been overlooked by the overriding objective of price stability. In that regard, one should be aware that, in the euro area as elsewhere, price stability aims at providing the highest sustainable growth and employment in the longer run; finally, the decisions have been taken in a timely fashion, the Eurosystem conducting its monetary policy in a forward-looking and pre-emptive way. However, the same figure shows that policy decisions deviate from time to time from the Taylor rule benchmark. Actually, being rule-based doesn’t imply being rule-bound and monetary policy decisions are not taken on the basis of mechanical rules. I already mentioned the Eurosystem adopted a full-information approach, which besides the usual array of economic and financial indicators also gives a key role to monetary analysis not factored in usual Taylor rules. Figure 4 illustrates the importance of such an approach in the context of our monetary policy decisionmaking process.
It is also imperative for central banks to continue exploring various policy toolkits to bolster resilience against volatile capital flows and exchange rate in the near future. Thank you for your attention. BIS central bankers’ speeches  5

For the moment, we are only at a preliminary stage, contemplating which tools a macro-prudential policy could be based on, and how these tools could be used. As regards supervision, this crisis has shown the merits of having the banking supervisor close to the central bank. The point is not to claim there is an optimal supervisory structure that fits any country’s circumstances. Rather, it is to note that a system such as the one we have in France has proved very useful in allowing for an in-depth knowledge of the banking sector and the various financial institutions. It also allowed for very swift and timely exchanges of information, and, as a result, allowed us at the central bank to quickly pass sensitive judgments, not least on the usefulness of injecting liquidity. Let me conclude by stressing what may seem obvious. We are going through very challenging times, in some respect even unprecedented times. In this context, policy making is also about confidence building and financial education. Thank you very much Ladies and Gentlemen. 4  BIS Review 9/2009
Yet demandside factors, linked, above all, to the re-opening of the economy after the pandemic and the depreciation of the euro, have also played a role in the increase in inflation. Overall, it is estimated that close to 75% of the increase in euro area inflation in 2022 was caused by the direct and indirect effects of energy and food prices. However, the supply shocks and the depreciation of the euro have been passed through faster than in prior episodes, prompting inflationary pressures to spread. Thus, underlying inflation (i. e. excluding energy and food) reached an all-time high of 5.2% last December. These inflationary pressures have elicited a forceful response from the main central banks, which is causing global financial conditions to tighten significantly. The war has also fuelled uncertainty regarding the security of Europe's energy supply and even made a major escalation in global geopolitical tensions a more likely prospect. These four factors have brought about a considerable slowdown in activity globally and an across-the-board downward revision to the outlook for economic growth, despite the European economy proving more resilient than expected a few months ago, particularly the labour market, where the unemployment rate stands at record-low levels. Overall, the latest European Central Bank (ECB) projections forecast an additional slowdown in activity in the short term. However, assuming the energy market rebalances, uncertainty decreases and household real income improves – as inflation progressively decelerates –, activity is expected to gradually improve in the second half of the year.

While there is a familiar ring to parts of this sorry tale, you can be comforted that our job at the Bank of England is to protect the value of the new Jane Austen note. In fact, maintaining confidence in our currency is the fundamental responsibility of your central bank. That extends to maintaining its value, protecting against counterfeiting, and also ensuring that the choice of character on the notes commands respect and legitimacy. The Bank of England has, through its banknotes, a unique and rare opportunity to promote awareness of Britain’s history and to acknowledge the life and work of its greatest citizens. After the announcement of the Churchill note concerns were expressed that – in the absence of any other changes to the Bank of England’s notes – none of the four characters on our notes would be a woman. That was not the Bank’s intention; we have listened and we fully understand the concerns raised by many people, including some whom I am delighted to see here today. We believe that our notes should celebrate the full diversity of great British historical figures and their contributions in a wide range of fields. The Bank is committed to that objective, and we want people to have confidence in our commitment to diversity. That is why I am today announcing a review of the selection process for future banknote characters.
Therefore, in addition to the other elements I mentioned earlier, such as risk controls and data quality, a clear and sound risk culture is also needed. This was an important element in the recent financial turmoil, particularly the episode triggered by the collapse of Silicon Valley Bank, although many of the underlying factors in that case have yet to be properly analysed. Nevertheless, some aspects can be highlighted: shortcomings in banks’ risk management, ineffective governance and an inappropriate business model, including in terms of interest rate risk, asset/liability management profile, liquidity risk and NBFI2 exposures.3 Others have also pointed to the gaps in regulatory and supervisory frameworks and the long period of low interest rates and ample liquidity. While these latter factors are all true, this episode has shown that even today some banks still fail to comply with basic risk management and governance practices. But what are the fundamentals of risk management and oversight by banks? Beyond the Basel Committee’s 2015 corporate governance principles for banks,4 there is no single approach to good corporate governance. The clear objective is to achieve sound risk management and decision-making. Banks’ board of directors, senior management and risk management function should be able to ask the right questions in a timely manner and take credible decisions to strengthen operational and critical resilience. This seems to be the real challenge, even today.

It’s understandable, faced with this extraordinary squeeze, that people and firms in the UK economy have sought to protect their real incomes – whether pay or profits – through compensating rises in wages and domestic prices. Unfortunately, and at least collectively, those efforts will not make us better off. It’s not as if one group or sector is worse off only because another, within the (non-North Sea) UK, is better off. The rise in import costs has depressed the purchasing power of the country as a whole. So all that can be done is to shift the losses from one place to another. And in the process, without any lasting impact on real incomes, the result is simply higher growth of nominal pay and prices. These are the “second-round effects” (of higher import prices on domestic inflation) to which monetary policy is having to respond. Today, I want to make three points about this process. First, monetary policy cannot undo the hit to real income. Nor could it ever have done. One often hears that people are worse off “because of inflation”. This is not quite right. Implicitly, it presumes that monetary policy could have prevented prices from rising so fast without doing anything to nominal incomes. Unfortunately, that’s not the case. Even assuming policy had been tightened sufficiently aggressively, and sufficiently early, to have knocked eight percentage points off the current rate of inflation, it would also have depressed nominal income growth by at least as much and almost certainly quite a bit more.
BIS central bankers’ speeches  7  E.  Public warnings  In the past decade, the NBR has constantly issued public warnings regarding the risks related to foreign currency loans, including CHF-denominated loans, taken by individuals earning incomes in currencies other than the loan currency. These recurrent warnings were disseminated via several communication channels: studies, conferences and seminars on financial stability and supervision issues, legal colloquia (available on the NBR’s website), statements made by central bank representatives during the quarterly press conferences, monthly meetings with the representatives of the Romanian Banking Association and other specialised associations (Association of Financial-Banking Analysts in Romania, National Association of Romanian Exporters and Importers, etc.). Most warnings were issued concomitantly with the release of prudential norms and/or restrictions by the NBR. We hereby underline that these activities are current and permanent, and are reported in the Annual Reports and the Financial Stability Reports published on the NBR’s website. V.  Other countries in the region – approaches to the situation caused by CHF appreciation  The measures taken by other EU Member States to deal with the challenges posed by CHF-denominated loans show that the solutions were different relative to the particular features of such loans in each country. Therefore, Romania must identify solutions that would fit its own situation. To cherry-pick the favourable components of the measures taken by other countries without revealing the context and the associated costs would be counterproductive.

Page 1  Bringing inflation back to the 2% target, no ifs no buts − speech by Andrew Bailey Given at the Mansion House Financial and Professional Services Dinner  Page 2  Published on 19 July 2022  Andrew Bailey talks about the impact of four recent shocks on our economy. These shocks have pushed inflation up, he says, but we will set monetary policy to bring it back down to our target. Speech Lord Mayor, it is a great pleasure to be here at Mansion House this evening. The return to more normal times allows those of us from the Bank to pop round to our neighbour for an informal light dinner. It is also pleasing that you have been able to resume travelling in pursuit of your important role of promoting the UK and in particular the services of the City. We thank you for that important work. Quite appropriately you have also been keen to ensure that there is a suitable number of events to mark your Irish roots, the strong connections between the City and Ireland, and the rich vein of form of the Irish rugby team. I would like to join you [and the Chancellor] in welcoming Paschal Donohoe. It’s always good to see you Paschal. Chancellor, congratulations on taking up the office. I know from a lot of experience that you will find a warm welcome in the City. In my experience, you will find that people in the City want to get things done.
This would also include new growth areas such as micro-financing or agricultural lending. The aim is to produce niche players delivering specialized value added products and services that will be able to cater towards specific segments of the market and over time, and thus develop a more comprehensive financial system that would contribute towards the development of a more diversified economy. Given the background of emerging economies, the transition to a more liberalised environment would indeed demand appropriate sequencing of measures and careful management of the liberalisation process that are guided by broad principles that would ensure that there are benefits and opportunities brought about by the liberalisation process. The financial sector is an important and strategic sector that has a significant role in supporting the economic growth and transformation. Liberalisation needs to commensurate with the pace of economic development and strength of the regulatory structure to avoid destabilising effects on the stability of the financial sector and the overall economy. Key considerations for the strategic opening up of the financial sector would be to steer the financial sector towards increased competition whilst ensuring domestic financial institutions are not marginalised by the liberalisation process. Liberalisation should instead serve as a catalyst for domestic banks to further improve their performance and enhance efficiency and capabilities in order to sharpen their competitive edge and elevate themselves to a level that is at par with the international players.

The banking sector is now in a prime position for the next step in evolution. The foundation for the development of a more efficient, effective and stable financial system has been laid. The task is now for the industry to move forward and undertake the necessary actions towards realising goals as envisaged in the FSMP. Nevertheless, this journey does not end in 2010. We should also look forward towards what lies beyond 2010. As an open economy, we should also be cognisant with the developments that take place around us. I believe that the Malaysian financial services industry is ready to take on this challenge to elevate the performance and standards of the sector. With this, I wish you a productive summit. BIS Review 55/2006  7
2 Recent expressions of solidarity from all over Europe following the barbaric terrorist attacks on staff at the satirical magazine “Charlie Hebdo” in Paris show what a central role the rights to freedom of speech and freedom of expression occupy in our system of values. These values of freedom are central among those accorded great importance in newer Member States from the former Eastern bloc. With the awareness that the common currency within the EU is evidence of closer integration, the introduction of the euro – especially in countries such as Lithuania most recently – is also perceived as a demarcation from, and protection against, purportedly aggressive hegemonic powers. This shows that the European Union and the euro area are far more than an amalgamation of independent nation states. Shared values are all the more important when the cement that typically holds together the parts of a full political union is missing. Alongside a shared identity – a loose concept which has sometimes been maliciously abused in the past, yet one which cannot merely be reduced to a successful football team – or language, this is often long-term transfer payments to even out differences in living conditions. Germany has this in the form of horizontal financial equalisation among the federal states [Länderfinanzausgleich], as well as transfer payments to the states of former East Germany, which are financed by the solidarity surcharge [Solidaritätszuschlag]. It may well be that one day the political will considers fiscal transfers between the Member States of the euro area necessary and desirable.

In concrete terms, membership of the euro should bring more stability and prosperity. In this respect, the Monetary Union has already taken considerable steps towards integration. But a common internal market and a single monetary policy alone is not enough to achieve this in the long run. With stricter budgetary rules for euro area countries, a stability mechanism and banking union, the Monetary Union is in a considerably better position today that it was at the start of the crisis. But despite these steps towards integration we still can’t speak of a completed Monetary Union. To sit back now, given what has been achieved, would therefore be wrong. Developing the Monetary Union further is a permanent undertaking. As a matter of principle, the prosperity of each individual country in a monetary union always depends on the financial and economic policies of the other Member States. Member States find themselves, as it were, in a community with a shared destiny. All governments are therefore well advised if they take the other Member States into account and coordinate their policies where appropriate. Member States thus not only need a common monetary policy, they also profit when they share more sovereignty in other policy areas. When I talk about “sharing sovereignty”, this in no way means that Member States lose their independent decision-making authority, let alone their national identity. On the contrary, the more sovereignty Member States share, the more influence they can sometimes gain. Let me illustrate this with an example.
of active scrutiny of the market, of shareholders and of creditors, which implies a continual strengthening of transparency. It is this latter aspect, relating to Pillar III, which is the least well-known, although it is that with the greatest potential in the medium term for disseminating best practices in risk management. Of course, the completion of Basel II is only the beginning of the implementation process, and not just in credit institutions, but also in their supervisors. In this respect, I believe that our institutions and our supervisory model are in a magnificent position to lead the implementation process insofar as quality is concerned. And this process will yield better managed institutions and more effective supervision. These two key regulatory issues raise other points. First, the development of IAS and Basel II make it necessary to strengthen international co-operation in supervision and regulation. The international expansion of Spanish banking and its presence in a larger number of jurisdictions with differing features raise the need to establish closer bilateral relations with the authorities of other countries, so as better to comply with the respective responsibilities. In addition, the new European legislation on financial conglomerates also addresses in depth the need for greater co-operation. Specifically, the EU has opted for a solution based on co-operation between supervisors as the most appropriate (and essential) approach.

Fiscal stability and fiscal discipline are basic assets of Spanish economic policy which, however, are not always easy to manage, as shown by the vagaries of the European fiscal framework. It is thus very important that the review of the Fiscal Stability Law and of the Autonomous (Regional) Government Financing system should not lead to a weakening of fiscal discipline. In a situation in which it is necessary to make headway simultaneously in job creation and in productivity gains, the role of supply-side policies geared to improving the workings of the economy and expanding its potential growth is crucial. One of the main messages in the Annual Report presented today is precisely that it will become increasingly difficult for the Spanish economy to keep raising its levels of well-being if it does not make progress on both these fronts. Maintaining high levels of job creation is, and will continue to be, a powerful means of expanding the economy’s growth potential, but it will be impossible to sustain economic momentum in the long term if the economy does not improve its competitive position in the increasingly dynamic international setting. And to do this, it is essential to significantly improve the poor performance of productivity. Under this approach, labour market reform heads the list of transformations that are needed.
Rather than simply resetting the quantitative standards, we sought a framework that would be better able to evolve with, and indeed encourage, future improvements in the measurement and management of risk, and one that would be well-anchored on a solid corporate governance structure and a sound risk culture. On a grand scale, we sought a capital framework that would promote greater financial stability, a public good that benefits consumers, businesses and banks alike. Comprehensive approach The new capital framework is much more comprehensive than the 1988 Accord for many reasons: it applies to a wider scope of entities within banking groups; it offers a menu of different alternatives to fit different circumstances; it encompasses additional risks, in particular operational risk; it widens the recognition of credit risk mitigation techniques; it sets out a thorough framework for securitisation transactions; and, most importantly, it is based on three mutually reinforcing pillars. As you may know, the first pillar refines the measures of minimum capital requirements. It aligns capital charges more closely and comprehensively to the actual economic risks a bank faces, and creates explicit incentives for banks to improve their internal measures and approaches to risk. Let me just add that this better alignment of capital to risk is a principle that we supervisors hold dear. It can sometimes be tempting to vary the capital rules in favour of particular sectors, but in my view this divorces capital requirements from risk, which ultimately benefits no one.

The oil price fall reduced revenues. At the same time, withdrawals from the fund have become substantially larger, in pace with the increase in the fund. Despite the subsequent downward revision of the expected real return to 3 percent of the value of the fund, we have spent as much oil revenues over the past decade as in the 40 preceding years. The fund was still three times larger towards the end of 20192 than at end-2009, owing to substantial value gains. Almost all the gains have been earned in the past ten years. The krone depreciation accounts for a quarter of the value gains (Chart 5). A weaker exchange rate means that we have to pay more for foreign goods and services, which is why the fund’s value is adjusted for exchange rate effects when measuring the fund’s return. 2 Figures for the GPFG as at 30 September 2019. 5  NORGES BANK  Chart 5 The krone has boosted value gains. Shares of total value gains. 1)  ECONOMIC PERSPECTIVES 13 FEBRUARY 2020  Percent  Exchange rate  GPFG's value gains in international currency  1) At 30 September 2019. Source: Norges Bank  The past ten years have been beneficial for the fund, also in foreign currency terms (Chart 6). The average return has been higher than in the fund’s first years, primarily reflecting a sharp rise in global equity prices. Chart 6 A good decade for the GPFG. Average annual return on the GPFG.