samchain/econo-pairs-v1 huggingface dataset:
In terms of positioning ourselves for future participation in world activity, in the first half of this year, we announced the International Investment Position to replace the old foreign debt data. Although statistically it was a partial IIP, since our legal system does not yet allow us to collect our foreign investments data in a timely manner, it allows investors to know our investments abroad systematically for the first time, a sine qua non if one were to borrow substantially from the world community. One has to know what investments one has offsetting it as well. In announcing the IIP, we thoroughly examined the foreign debt and put in a new complete data collection system even though it would show that we owed 20.5 billion dollars more than what we had previously announced. Our IIP was announced with a foreign debt of 105 billion dollars for 1997, clearly underlining the bad performance of the economy in that year. It is now reduced to 88 billion dollars, a level compared to the present GNP, which is quite acceptable, although still difficult to manage and must be watched with careful attention. A decision was also made again in the spirit of transparency and sensibility to show these data to Moody Investor Services who thereupon upgraded us to investment grade. To make future growth sustainable and high, after a long, arduous preparation over a year and a half, we went into the inflation targeting system, with an inflation band of 0-3.5%.

In this respect, banks are now allowed to close branches freely and also are free to decide opening and closing hours. We are working on the rules on the free opening of branches, being quite far ahead in this, and we expect to announce it, certainly within the next two to three months, whereby lending conditions tied to branch opening are probably going to be removed. This initiative is undertaken under the concept that banking services coverage is now adequate and we need not force banks any longer to do things for social reasons. Competition between service providers will probably lead to better results than government directed banking. We have now also agreed on the rules for internet banking, defined as the traditional counter service banking using e-commerce technology. Our idea is simple in that what could be done over the counter will be allowed over the internet. The similarity in service even goes so far as that we will not allow pro-active selling in the internet but that it must be passive in the same way that we require that selling of non-banking services over bank counters must be passive. In terms of e-commerce, what that means is that logos of non-bank service suppliers in the bank’s web must not be on the main page. Transactions with the suppliers must be done by transferring into the supplier’s web rather than on the bank’s web services and, of course, the bank’s client, must log in. The banks may not push their services onto their clients’ computers.
The analysis in the June Inflation Report showed that a reduction in the sight deposit rate towards 3 per cent, combined with some depreciation of the krone, 2 could bring inflation up towards the target two years ahead. More moderate wage settlements in the 3 future would provide a basis for even further monetary policy easing and a weaker krone. Without considerable monetary policy easing, inflation might have remained too low for an extensive period. The short-term nominal interest rate in Norway has now reached a historically very low level. Interest rates have not been lower since the first nine to ten years following the Second World War. The real interest rate is also low, although by no means as low as it was when inflation plagued Norwegian savers in the 1970s and 1980s. The low interest rate must be viewed against the risk of persistently low inflation both in Norway and in other countries. So far, indicators of inflation expectations do not point to any substantial deviation from the inflation target of 2½ per cent. However, if inflation should remain too low for an extensive period, there is a risk that expectations of continued very low inflation will be generated. It may then prove difficult to fuel economic activity by stimulating demand. A marked easing of monetary policy has therefore been appropriate. The inflation target is symmetrical. It is equally important to avoid an inflation rate that is too low as it is to avoid an inflation rate that is too high.

We may not yet have seen the full effects on the krone exchange rate of the interest rate reductions that have been implemented. At the same time, the krone can be influenced by fiscal policy and the outlook for wage growth. Norges Bank’s Executive Board sets the interest rate with a view to achieving the inflation target of 2½ per cent. The inflation target is also a vehicle for monetary policy’s contribution to stabilising output and employment. When setting the interest rate, the Executive Board seeks to achieve a balance. The objective of stimulating growth in the Norwegian economy and achieving the inflation target is weighed against the risk of new pressures building up in the economy over the long term. Since December 2002, we have judged that to achieve this balance it was appropriate to reduce the interest rate to a low level. At the last monetary policy meeting on 13 August, it was decided to reduce the interest rate to 3.0 per cent. With an interest rate of 3.0 per cent, the Executive Board’s assessment remained unchanged, i.e. that the probability that inflation two years ahead will be lower than 2½ per cent is greater than the probability that it will be higher. Thank you for your attention. BIS Review 38/2003  5
were implemented by the Central Bank,  Fiscal policy in 2016 has been directed towards strengthening the fiscal consolidation process. Reflecting the positive impact of the strenuous efforts of the government, fiscal performance has indicated an improvement during 2016. Government revenue has continued its increasing trend while  in line with international standards and best practices, to strengthen the regulatory and supervisory framework pertaining to licensed banks. Key banking sector indicators remained at healthy levels, while the nonbank sector performed despite stringent fiscal and macroprudential measures. maintaining expenditure at the desired  Meanwhile, the national payment  level. The government is certain that the  systems of the country operated  announced budget deficit of 5.4 per cent  smoothly without any major disruption  of GDP will be achieved in 2016, and it  while facilitating the growing and  will be reduced further to 4.6 per cent in  changing payment needs of the financial  2017.  sector with improved efficiency and safety. Central Bank of Sri Lanka – ROAD MAP 2017  10  3. Monetary Policy Strategy and Policies for 2017 and Beyond A coherent and clear macroeconomic  macroeconomic policy framework in  framework, is important to achieve our  the country, built upon three key areas. objectives. The government is in the process of  Among the key elements of the overall  taking decisive measures to address the  macroeconomic framework, price  long felt deficiencies in its budgetary  stability is an important pillar.

development, because for years now, the Central Bank has had to cope with  We should access the international  the conflict of interest of trying to  capital market when market conditions  conduct an independent monetary  are favourable to Sri Lanka to build a  policy while at the same time, raising  buffer to avoid unwarranted domestic  funds for the government as cheaply as  market pressure due to limited resource  possible. This conflict of interest poses  availability. This would broaden and  challenges to the monetary policy  Central Bank of Sri Lanka – ROAD MAP 2017  29  conduct of the Central Bank. Therefore,  Sri Lanka, implements a number of  taking away the debt management  concessionary development credit  function would enable the Central Bank  schemes through Participating Financial  to have a greater room to manoeuvre to  Institutions (PFIs), with a view to uplift  conduct an independent monetary  living standards to enhance financial  policy. literacy as well as financial inclusion, and  Foreign Exchange Management: With a view to further relaxing foreign exchange transactions, the Central Bank  to ensure balanced regional growth and equitable development.  A New Loan Scheme for the Micro,  has implemented several new policy  Small and Medium Scale Enterprises  measures in the recent past with the  (MSMEs): A new loan scheme for the  support of the government.
Figure 5  Output by sector (*) (average index, 2006-2009=100)  130  130  120  120  110  110  100  100  90  90  80  80  70  06  07  08  09  10  70  135  IMACEC (*) (index, 2003=100)  135  130  130  125  125  120  120  115  115  07  08  09  10  Retail sales Manufacturing output (*) Seasonally-adjusted series. Sources: Central Bank of Chile and National Statistics Bureau (INE).

Certainly, the deteriorated external financial conditions and the world deceleration that would be created in this risk scenario could have a negative impact on the Chilean economy. However, as it did at the end of 2008, the Chilean financial system is prepared to adequately deal with this tighter external scenario, and the Central Bank has the necessary tools to mitigate these effects on the liquidity and proper functioning of local monetary markets. The materialization of some of these risks would have direct consequences for the projected scenarios for national growth and inflation. After considering all the above elements, the Board estimates that the risk balance for output and inflation are unbiased. In any case, as it has done before, the Board will adopt all measures necessary to address any events reshaping the macroeconomic scenario and inflationary forecasts. Let me share with you some final thoughts before I finish. Final thoughts In the past few years we have faced several external shocks that have required us to act flexibly, even changing abruptly the direction of monetary policy. For that we have relied on our policy system designed to accommodate to changes in the economy within the framework of a price stability objective. It is enough to recall that in 2007–2008 we lived through a period of high and very complex inflationary upsurge. The causes were essentially external, aggravated by an unusual propagation to other domestic prices.
Our financial centre has been built on a wide range of comparative advantages: a financially sound country, a stable political and monetary framework, a long tradition of banking and an internationally oriented economy. All these points are also valid for the United Kingdom. There is a major difference in terms of specialization, however: the City is “the” market place for investment banking and a number of other financial activities in Europe, whereas Switzerland plays a dominant role in asset management. Despite different realities and market positions, Switzerland and the United Kingdom share many common values vis-à-vis their financial centre: –  both countries believe that financial activity requires professionalism, high standards and efficient supervision;  6  BIS Review 13/2002  –  both countries consider money laundering and the financing of criminal activity as major threats for the long term development of their financial system and act decisively against them;  –  both countries favour market competition in general and have a liberal attitude toward tax competition in particular;  –  both countries are reluctant to accept over-regulation and see in the mushrooming of offshore centres a source of risk for the global financial system. I come therefore to the conclusion that there are more converging interests than rivalries between our financial centres. Some diverging views are due to misunderstandings. With its traditions and its experience in asset management, Switzerland attaches great value to financial privacy.

However, the industry must lose no time in tackling the restructuring that is needed, particularly in the traditional segments. In the area of alternative products, Switzerland has admittedly been successful in the fund of funds business. It is to be hoped that its financial industry will build on this success and become even more of a centre of excellence for alternative investments too. BIS Review 24/2006  1
In developing countries and emerging economies, where tax collection and institutions are weaker, debt tolerance is lower. In addition, borrowing costs tend to be higher. On the other hand, they have greater scope for growing out of high debt. (See Chart: Debt at the time of default.) When the euro area was established, the Growth and Stability Pact stipulated that a country’s budget deficit should not exceed 3 per cent of GDP and that debt should not exceed 60 per cent of GDP. When France and Germany were among the first countries to breech the criteria in 2003, the rules of the game were changed. This influenced the discipline of the other member states. It would almost seem that several countries viewed the limits as a floor rather than a ceiling. 10  Sejersted, Francis (1973): Ideal, teori og virkelighet. Nicolai Rygg og pengepolitikken i 1920-årene (Ideals, theory and reality. Nicolai Rygg and monetary policy in the 1920s). 11  J. M. Keynes (1919): The economic consequences of the peace. Keynes probably based his argument on the assumption that the payments would constitute a far larger share of the national income than indicated here. 12  International Monetary Fund (2010): “Navigating the Fiscal Challenges Ahead”, Fiscal Monitor.

Sooner or later, with the recovery of global economy, money supply pumped up to the system involves the risk of inflation if the central banks miss the soft spot in the timing of the exit strategies. The solution I believe is the announcement of credible consolidation plans going forward in stabilizing global economy in order to reduce the risk of wilting the green shoots. Therefore, it is vital for both monetary and fiscal authorities resolve the issues of long term fiscal sustainability and price stability. Esteemed Guests, Following my opinions about the recent developments in global economy, I would like to talk about the Turkish economy and our recent implementation of monetary policy. The global turmoil has adversely affected financing facilities and external demand, and led to a significant slowdown in economic activity in developing countries. We also had our fair share of it. The Turkish economy, which had been growing for 27 quarters in a row, experienced a severe contraction during the last quarter of 2008 and the first quarter of 2009. The higher share of cyclically sensitive exports, firms’ dependence on external financing, and high level of production capacity were all factors that exacerbated the severity of the recession. 2  BIS Review 123/2009  Parallel to the contraction in aggregate demand coupled with the sharp drop in commodity prices, inflation plummeted markedly. Easing of concerns over inflation enabled us to focus on containing potential adverse effects of global financial turmoil on the domestic economy without compromising our price stability objective.
It is reasonable to expect that some of the differences will disappear over time. Result With more than ten years of experience with inflation targeting, we can now evaluate what the countries have achieved. Inflation had already fallen somewhat among the OECD countries that first introduced inflation targeting. Inflation has fallen further and has remained at the lower level. There is also considerably less variability in inflation. Inflation targeting in Chile and Israel reduced inflation from a very high level. There is also less variability in inflation. The countries that introduced inflation targeting from the end of the 1990s may be divided into countries with high inflation and countries with low inflation at the time of the shift in monetary policy. Inflation has remained low and stable in those countries that initially had low inflation. The countries  BIS Review 43/2005  5  where inflation was high have so far experienced the same favourable developments as Chile and Israel. Many of the countries that have inflation targeting today previously had a fixed exchange rate regime. With inflation targeting, the nominal exchange rate fluctuates. In those countries that introduced inflation targeting first, fluctuations in the exchange rate have diminished. Changes in the exchange rate are of importance to interest rate setting because the exchange rate affects inflation and output. When there are prospects of moderate economic activity, low wage growth and low inflation, the central bank will reduce the interest rate. This will normally result in a weaker currency.

With a price level target, high inflation today must be followed by low inflation tomorrow. This is not the case with an inflation target. One advantage of a price level target is that it may reduce the uncertainty surrounding the price level ahead. But the view has been that a price level target results in wider fluctuations in output and employment and less stable inflation. Recent literature challenges this view.5 As far as we know, there are no concrete plans in any country to shift to a price target. A third characteristic of inflation targeting is that the central bank alone sets the interest rate - the central bank has instrument independence. One exception must nevertheless be mentioned here. In the UK, the authority to set interest rates was not transferred from the Ministry of the Exchequer to the Bank of England until 1997, five years after an inflation target had been set. In some countries, legislation allows the authorities to review the decisions under very special conditions. This has not had any practical significance. A fourth characteristic is that central banks in inflation-targeting countries are transparent. This provides broad insight into the basis for interest rate decisions. Transparency makes monetary policy more predictable. Inflation targeting provides an explicit and understandable framework for clarifying and stating the reasons for the trade-offs in interest rate setting. Central banks practice transparency in different ways.
In consequence, to stabilise inflation, real interest rates must now be lower than they were two or three decades ago. Indeed, in economies such as the euro area, various estimates even place the natural rate of interest at negative levels.4 This would not be a problem if nominal rates were able to fall as far as was necessary; for example, with expected inflation of 1%, to place the natural rate of interest at, let’s say, -2%, the nominal rate would have to be lowered to -1%. The problem lies in the fact that nominal interest rates cannot fall as far as is necessary into negative territory. If the central bank were to impose negative rates of -5%, for example, the commercial banks would bear negative returns on the bulk of their assets. This would adversely affect their financial intermediation capacity, with a consequent negative impact on the supply of credit, economic activity and inflation. There is therefore a lower bound on nominal interest rates: if the central bank reduces interest rates below that level, the effect on the economy may be contractionary rather than expansionary, owing to the negative impact on the financial system overall.5 The level of that lower bound on interest rates is not directly observable and varies over time in accordance with the situation of the financial sector. However, it is, in any event, the lower limit on the extent to which central banks may reduce interest rates.

Fiscal policy is undoubtedly the most appropriate tool to act as the first line of defence in this setting, since it has the instruments to achieve this objective with immediate and targeted actions that are suited to a shock whose duration is uncertain and heterogeneous. 1  The response of European governments has generally been commensurate with the challenges posed by this crisis. Their response has also been resolutely backed by the European Union (EU), especially following the approval of the European Recovery Fund by the European Council. For its part, monetary policy should act, and has acted, very forcefully too. Indeed, the economic shock triggered by the pandemic was accompanied by aa strong tightening of financial conditions in the euro area. As various governments, including Spain’s, announced plans to contain the virus, financial markets began to discount heavy declines in economic activity and increases in public and private debt. This drove risk premia (i.e. the compensation demanded by bond investors for the probability of borrowers defaulting) higher. That resulted in an increase in the interest rate that governments, households and firms pay on their rising debts, which will necessarily amplify the fall in aggregate demand and, therefore, in inflation, owing to the direct impact of the pandemic and the measures adopted to limit its spread. Faced with this situation, on the ECB Governing Council we had to act swiftly to reverse the upswing in the borrowing costs for the various economic agents.
Per Jansson: Swedish monetary policy after the financial crisis – myths and facts Speech by Mr Per Jansson, Deputy Governor of the Sveriges Riksbank, at the SvD Bank Summit 2014, Stockholm, 3 December 2014. *  *  *  “The Riksbank has in recent years conducted a monetary policy experiment where it has aggressively, using a high repo rate, attempted to prevent household debt from rising. The results have been more or less devastating for the Swedish economy. Eventually, the Riksbank has realised that its policy was wrong and has made a 180 degree turn.” This is roughly how some critics have described the monetary policy conducted in recent years. This description has received quite a bit of attention and been widely spread, and many who follow the monetary policy debate have probably gained the impression that this is actually what has happened. I argue that this description is wrong and I now intend to explain why. I shall divide the criticism into three different parts, or claims, and discuss them one by one. I will present these claims in the form of quotations, but this does not necessarily mean they are exact quotations. However, they capture the spirit of the criticism and I believe that those who have followed the monetary policy debate will recognise them. It is important to meet the criticism, for several reasons One question one might begin with, is why it is so important to respond to these claims.

“The Riksbank has aggressively, using a high repo rate, tried to prevent household debt from rising” The first part of the criticism can in turn be divided into different parts. For one thing, it claims that the Riksbank has leaned against the wind aggressively, and for another thing that household debt has been the main, if not the only, reason for this policy. I intend to comment on these points one by one. So how much has the Riksbank in practice leaned against the wind in recent years? My view here is clear. The monetary policy conducted after the crisis has for the most part been governed by traditional monetary policy motives, that is, the expected development of economic activity and inflation over the coming years. Giving consideration to the risks associated with the developments in household debt and housing prices has been part of our assessment, but a relatively minor part. The picture painted in the criticism has been quite different. Here the starting point is instead that the Riksbank’s concern over developments in household debt was the main motive for raising the repo rate after the financial crisis. Much of the criticism even seems to assume that household debt was the only motive for raising the repo rate.