samchain/econo-pairs-v1 huggingface dataset:
Even this very summary review illustrates how the changeover to a single currency in Europe will affect conditions for the financial system. The financial markets will become larger, accompanied by increased competitive pressure. Some activities will be modified or disappear entirely. Others will be concentrated to one or a few financial centres. But there will probably also be some new activities. These developments will leave their mark even in countries that do not join the euro area but are adjacent to it. This, too, is a process that has already begun. Banks are being merged into large units. Cost-cutting has come to the fore. Modes of distribution are being overhauled along with a buildup of specialist knowledge. Systems for pricing different products are being changed. Financial transformation not straightforward Today there is a widespread conviction that free trade in goods and services enhances prosperity in the long term. In the same way, most things suggest that in time, free trade in the financial field leads to increased economic growth. But we have also learned that the transformation and development of the financial field are not without problems. In the past decade there have been bank crises in a number of countries as well as several heavy corrections and large fluctuations in money, equity and currency markets around the world. There is nothing inherently new about financial crises. On the country, they have occurred from time to time for many centuries.

Such “tilt” investment strategies, which overweight high ESG stocks, and “momentum” investment strategies, which focus on companies that have improved their ESG ratings, have outperformed global benchmarks for close to a decade. More widespread adoption of such strategies is essential. At present, one of the biggest hurdles to doing so is the huge variation in the measurement of ESG.18 Common taxonomies to identify environmental outperformance, such as the EU’s Green Taxonomy and the Green Bond Standard can help but they tend to be binary (either dark green or all brown). Mainstreaming sustainable investing will require a richer taxonomy – 50 shades of green. One promising option highlighted by the UN’s Climate Financial Leaders is the development of transition indices composed of corporations in high-carbon sectors that have adopted low carbon strategies. Consideration should also be given to the new assessments by leading asset owners of how well their portfolios are positioned for a two degree target. Once again, Japan is leading the way. GPIF, the world’s largest pension fund, calculates that its portfolio is aligned to a 3.5 degree world. Allianz assesses that it is on 3.7 degree path and has committed to get to 1.5 degrees by 2050.
In terms of activity, the percentage of GDP generated in quarantined areas has dropped from 65 to 45%. The relationship between quarantined territories and economic activity, however, is far from mechanical, depending on sector-specific characteristics, the intensity of the measures in place and the actual behavior of individuals (Figure 2). Looking ahead, the process of deconfinement is not exempt from the risk of setbacks, as has occurred in other parts of the world and in some areas of the country. Globally, the loosening of confinements and the increase in mobility have cooperated to draw activity above its lowest points of April and May. Production, sales, and expectations show improvements in some countries (Figure 3). It should be noted that in China the data for the second quarter were above expectations. Financial markets and commodity prices have been favored by these trends, as well as by the highly expansionary monetary conditions promoted by the major central banks. The price of copper has fluctuated around $ per pound and market volatility has seen significant reductions from its highs of March and April. This represents an important difference with respect to external shocks that have affected the Chilean economy on past occasions. Our country’s economy contracted by 14.1% annually in the second quarter, its worst record in several decades. The biggest month-on-month drop was in April, subsiding in May and recovering slightly in June and then again in July. The sharp initial contraction also occurred in a wide range of countries, although with some nuances (Figure 4).

The balance, up to this point, shows is the economy has managed to contain the pressure of the global crisis generated by the pandemic, achieving sufficient stability to undertake a recovery. The Central Bank has contributed to this, without abandoning its medium-term institutional agenda. All this, however, is far from implying that the crisis has been weathered and the job is done. While the figures for activity in 2020 are beginning to stabilize, revealing that a major catastrophe has been averted, the evolution of the economy in 2021 and 2022 will determine the deeper legacy of this episode. Just to recover the losses of the past year there is a long and difficult road ahead, full of challenges and risks. Measured only in the per capita income dimension, by the end of this year we will have fallen back to the levels 8 The BIS, CEMLA, and World Economic Forum, among others. 10  of 2013 (Figure 17). If the growth trend between 1990 and 2008 had been maintained, by 2025 we would be close to doubling the 2008 per capita income. However, the sum of the years of low growth, the social outbreak and the Covid-19 crisis only allows us to project that by 2025 per capita income will have accumulated an increase of around 25% since 2008. To even consider closing this gap, it will be necessary to create hundreds of thousands of jobs, sustainably recover consumption, reactivate investment, and maintain credit growth.
Inflation expectations over the medium to longer term continue to be firmly anchored in line with the Governing Council’s aim of keeping inflation rates below, but close to, 2% over the medium term. Risks to the medium-term outlook for price developments are still broadly balanced but, as already indicated in January, could move to the upside. Currently, upside risks relate, in particular, to developments in energy and non-energy commodity prices. Furthermore, increases in indirect taxes and administered prices may be greater than currently expected, owing to the need for fiscal consolidation in the coming years, and price pressures in the production chain could rise further. On the downside, risks relate mainly to the impact on inflation of potentially lower growth, given the prevailing uncertainties. Turning to the monetary analysis, the annual growth rate of M3 declined to 1.7% in December 2010, from 2.1% in November. The annual growth rate of loans to the private sector also declined, albeit marginally, to 1.9% in December, after 2.0% in November. These declines partly reflect the reversal of special factors that operated in November and do not indicate a general weakening of monetary dynamics. Overall, however, broad money and loan growth is still low, confirming the assessment that the underlying pace of monetary expansion is moderate and that inflationary pressures over the medium to long term should remain contained. Looking at M3 components, annual M1 growth moderated further to stand at 4.4% in December 2010, reflecting the prevailing low remuneration of overnight deposits.

10 But even with those constraints applied we have considerable headroom after the current programme is completed, reflecting a range of considerations. And many of those considerations are within our control - while those constraints are there for good, pragmatic reasons, they are not set in stone, and there would certainly be scope to re-evaluate them based on Bank advice if the MPC judged that even more monetary policy headroom was needed (Figure 8). Figure 8: There is plenty of QE headroom remaining Stylised map of the gilt market1  (1) The area of each block represents the market value of the gilts in that sector of the market. Taking as a given that the MPC has more headroom to buy more gilts, the question then becomes whether we have the scope to impact their pricing. This is a trickier calculation– it depends not just on the quantity of headroom, but on how effective any action might be, which is highly state contingent. But again my starting point is we have plenty of scope to affect prices. While yields on longer-dated gilts are at historically low levels, that doesn‘t mean they couldn’t still go lower. As the March episode illustrates, there may also be occasions when the absence of action – the counterfactual – would mean an increase in those yields. Of course the quantity of QE purchases is not the only policy variable available to the MPC. The pace of purchases, as illustrated by our March intervention, is another.
Vítor Constâncio: Banking Union and European integration Speech by Mr Vítor Constâncio, Vice-President of the European Central Bank, at the OeNB Economics Conference, Vienna, 12 May 2014. *  *  *  Ladies and gentlemen, I thank the Oesterreichische NationalBank for inviting me to Vienna to make this address on the Banking Union and European Integration at the occasion of one more of its prestigious Economic Conferences. As Vice-President of the ECB, I have been involved in the Banking Union project from the start and it is with great pleasure that I now see it beginning to come into place. By the start of next year, we will have an operational Single Supervisory Mechanism (SSM) and Single Resolution Mechanism (SRM). It is undoubtedly the more important and far reaching reform in the European Union since the creation of the euro. As many other European institutional innovations, the project was born in connection with the crisis management effort of trying to sever the bank-sovereign nexus that was contributing to financial fragmentation. The idea of launching the SSM emerged during the June 2012 European Council meeting. It was a consequence of the decision that the ESM could directly recapitalise weak banks, thus taking some fiscal pressure off sovereigns. But if the European level were to assume liability for European banks, it also logically had to assume control: hence the need for a European supervisor.

from assessing the resolvability of banks and drawing up resolution plans, to deciding on resolution schemes for failing banks and whether to make use of the Fund in such cases. These tasks are shared between the Board at the European level, which is directly responsible for all banks under direct ECB supervision and all cross-border banks, and the national resolution authorities, which are responsible for the other banks. However, the Board may at any time decide to directly exercise all the relevant powers under the Regulation with regard to any of the indirectly supervised banks. In addition, the Board also becomes directly involved whenever a resolution of an indirectly supervised bank will make use of the Fund. Finally, there is also an option for Member States to choose that the Board will be responsible for all banks in their jurisdiction. These features make the SRM a single system. The Single Resolution Board At the centre of the SRM there needs to be a single authority with operational independence and sufficient decision-making authority to take resolution action in the interest of the euro area and of the Union as a whole. This is achieved with the setting up of the Single Resolution Board. The Board will meet in two different compositions: the plenary and the executive sessions. The executive session will consist of a Chair, four independent full-time members and two observers from the Commission and the ECB, respectively.
The US slowdown comes at a particularly bad time for Japan which is already suffering from a combination of weak domestic demand – particularly consumer demand – and supply-side constraints reflecting pressures on the banking system, heavily burdened with non-performing loans, and an acknowledged need for restructuring parts of the non-financial sector. Japan has pretty well exhausted the scope for macro-economic stimulus. Successive fiscal packages focussed on public works, and a sustained period of attempted monetary expansion, at near-zero interest rates in the face of deflation, have failed to overcome a high rate of precautionary saving by an ageing population facing an uncertain economic future. The policy emphasis of the new Japanese administration appears to be shifting towards firmer action to bring about supply-side reform in the belief that this will help to engender greater confidence. The danger is that, to the extent that more aggressive restructuring results in bankruptcies and higher unemployment in the short term, that in itself might tend to weaken consumer demand for a time before the benefits of the restructuring come through. Closer to home, the Euro area economy is a good deal better placed to withstand the US slowdown although we are all bound to be affected to some degree. For most of last year the Euro area economy performed relatively strongly, with overall output growth well above trend, and unemployment in the area as a whole continuing to fall from its earlier chronically high level.

For 2012, the inflation rate will amount to –0.7%. For 2013, we expect inflation of –0.1% and for 2014, 0.4%. In the foreseeable future, therefore, there is no risk of inflation in Switzerland. The third quarter of 2012 saw weak growth and a decline in trading activity worldwide. Although growth in the US economy and some of the emerging economies picked up, a mild recession persisted in the euro area. In Switzerland, real GDP in the third quarter increased again following a temporary downturn. For the fourth quarter, however, we expect significant weakening in growth. Consequently, economic growth in Switzerland for the year 2012 is likely to remain unchanged at around 1.0%. For 2013, we expect growth of 1.0–1.5%. The downside risks for the Swiss economy remain considerable. Although the measures announced by the European Central Bank (ECB) have significantly reduced the probability of extreme developments in the monetary union, there is still substantial uncertainty in connection with the management of the debt crisis in the euro area. It also remains to be seen how far the upcoming budget consolidation in the US will hamper growth. This question is weighing on the sentiment in the financial markets and the real economy. Moreover, momentum in the Swiss residential mortgage and real estate markets remains strong, and has led to a further increase in risks for financial stability. Global economic outlook I would now like to outline the outlook for the global economy and Switzerland in more detail.
This also includes those parts that may not be under the regulatory capture. Financial stress in a specific segment may no longer be confined to that segment but may rapidly be transmitted to the rest of the financial system. Thus, a piecemeal policy response would not be sufficient. It would require a comprehensive response to ensure that such stressed conditions does not evolve into a major financial crisis. Secondly, the build-up of risks to financial stability need to be identified early. Pre-emptive action would reduce the cost of the crisis on the financial system and the economy. Third, the regulatory authorities need to be accorded the necessary powers to manage the risks to financial stability. Fourth, the optimal policy mix may not only include policy actions to address immediate term issues but would also need to simultaneously address the underlying structural problems. Fifth, is to give recognition to the importance of enabling conditions that will render the implemented policies to yield the desired outcomes. Finally, to facilitate effective policy decision making there needs to be a platform and governance process for policy coordination across agencies within an economy and for this to be extended for regional and international collective action. Following the recent global financial crisis, the policy response at the national level has been extensive and on an unprecedented scale.

Zeti Akhtar Aziz: Global financial stability and the internationalisation of financial systems in emerging economies Speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the EuromoneyQatar Conference “Global financial stability and the internationalisation of financial systems in emerging economies”, Doha, 11 December 2012. *  *  *  It is my honour to be here in Doha to speak at this Euromoney-Qatar Conference on “Global Finance Re-designed”. I wish to thank the Qatar Central Bank for the invitation to speak at this event. In this current global environment, the unprecedented and wide ranging global policy responses have yet to produce financial stability and a sustainable recovery of the global economy. The intensification of the globalization of finance in this decade has resulted in an even more connected and interdependent world. While the financial systems and economies in most parts of the world felt the effects of the recent global financial crisis, it has not discouraged the pace of internationalization of financial systems, in particular, in emerging economies. My address this morning will be on financial stability and the internationalization of financial systems in emerging economies. My remarks will cover the benefits and challenges of such internationalization, the lessons that can be drawn from the recent global financial crisis, the Malaysian experience on the internationalization of our financial system. Benefits and challenges of internationalisation of financial systems While there are significant benefits from internationalization of financial systems, the resulting increased international financial integration brings with it new risks and challenges.
Source: Central Bank of Chile. Page 11 of 19  Jul.20  Figure 5 Households' consumption (annual change, percent)  30  30  20 10  Durable goods  Services  0  20 10 0  Non-durable goods  -10  -10  -20  -20  -30  -30  -40  -40 17  18  19  20  Source: Central Bank of Chile. Figure 6 Inflation indicators (annual change, percent)  6  6 Goods w/o volatile items  6  5  5  4  4  4  3  3  3  2  2  2  1  1  0  0  5  Services w/o volatile items  1 0 19  Jul. 20  Jul. 6 Last MP Report  5 4  CPI  3 2  CPI w/o volatile items  1 0  16  17  Sources: Central Bank of Chile and National Statistics Institute (INE).

Page 17 of 19  20 Apr.20  20 Aug.20  Table 1 Domestic scenario (annual change, percent)  2019  GDP Domestic demand Domestic demand (w/o inventory change Gross fixed capital formation Total consumption Goods and services exports Goods and services imports Current account (% of GDP) Gross national savings (% of GDP) Nominal gross fixed capital formation (% of GDP)  2020 (f)  2021 (f)  2022 (f)  Sep.20 Report  Dec.20 Report  -5.5/-4.5 -7.1 -5.6 -10.6 -4.2 -2.2 -9.4 -1.4 18.5 21.0  -6.25/-5.75 4.0-5.0 5.5-6.5 3.0-4.0 -9.1 5.6 9.4 2.7 -7.8 7.0 9.6 2.4 -13.0 8.0 7.3 4.9 -6.3 6.8 10.3 1.7 -1.7 5.0 4.3 4.8 -12.6 8.6 16.0 2.2 0.9 -2.5 -1.5 -1.7 19.7 16.8 17.0 18.2 20.5 21.8 20.6 22.2  1.1 1.0 1.5 4.2 0.8 -2.3 -2.3 -3.9 18.9 22.4  (f) Forecast. Source: Central Bank of Chile. ***  Page 18 of 19  Sep.20 Dec.20 Sep.20 Dec.20 Report Report Report Report 3.0-4.0 2.9 2.5 5.1 1.8 4.8 3.4 -1.8 17.6 21.2
I would therefore like to spend a little time going into these areas in detail  Responsible investment The work in the area of responsible investment has undergone substantial changes since the fund began investing in equities in 1998. From the start, the approach was that the fund should be invested in the world as it is. At that time, the fund was not supposed to exercise ownership rights. As the fund has grown, its size and international position have made such an approach virtually impossible. In 2004, on the basis of discussions in the Storting, the Ministry of Finance laid down ethically motivated guidelines for the observation and exclusion of companies from the fund. Today, the fund must not be invested in companies that produce certain types of weapons, base their operations on coal, or produce tobacco. Nor shall the fund be invested in companies whose activities otherwise contribute to violations of fundamental ethical norms. In 2004, the Ministry also established an independent Council on Ethics to make ethical assessments of companies. Following a change in 2015, the Council on Ethics sends its recommendations to Norges Bank. The decision is taken by Norges Bank’s Executive Board, which is tasked with assessing the policy tool that is most appropriate. At the end of 2019, 134 companies had been excluded from the fund’s investment universe. Chart: Responsible investment But the fund’s responsible investment involves more than merely questions of what we will not own. Our key policy tool is the exercise of our ownership rights in companies.

One of the distinguishing features of the Brazilian economy is its prudential regulatory framework. The vigilant stance of the Central Bank prevented the development of  1  2  See http://www.oecd.org/document/59/0,3343,en_2649_34349_41966331_1_1_1_1,00.html, 2009. January  12,  BIS Review 8/2009  disequilibria and excesses that emerged in several other economies. We did not let the markets adopt risk taking attitudes that led to the losses and problems that many countries are facing today. In fact, the Brazilian framework is considered a model for prudential regulation and regarded as an example to be followed by other regulatory authorities. That does not mean that Brazil is not being hit or suffering the impacts of the financial turmoil. But the Brazilian government is prepared to react and take all the necessary measures to tackle the crisis. In conclusion, a floating exchange rate is no cure-all remedy for all economic ills. But it is certainly the best regime for a large, relatively closed, economy like ours. If Brazil had not floated the BRL in 1999, it would surely have done so since then, and possibly in more adverse conditions. For all the above, this 10th anniversary is worth celebrating. Thank you very much. BIS Review 8/2009  3