samchain/econo-pairs-v1 huggingface dataset:
Can we in some way ensure that macro economic factors and systemic risk factors have a better impact in our policy measures and supervisory systems? Bursting bubbles with interest rate policy? Many analysts consider that one important factor behind the current financial crisis is that interest rates have been kept at a low level for a long period of time, particularly in the United States. The outlook behind the policy conducted was that central banks are not particularly good at assessing whether or not an asset bubble is being built up. Monetary policy should therefore only respond to a rapid increase in house prices and indebtedness if the forecast is that this risks leading to overheating in the economy and thereby to excessively high inflation. If this is not the case, the central bank should wait and see, but be prepared to quickly ease monetary policy if the housing market were to collapse and demand in the economy were to fall drastically. This view has come to be increasingly questioned, not least as the work on "cleaning up afterwards" has proved to be fairly extensive if the central banks have been too passive during the build-up phase. This is particularly so if the price bubble can be linked to a credit expansion. In most cases it is the credit expansion – and not the prices themselves – that is the most worrying. Should it not therefore be possible to use monetary policy more actively to subdue an upturn in asset prices?

This reassessment, therefore, is important and will provide a useful starting point for a better deliberation of monetary policy going forward. For this morning, I want to focus my remarks on three issues: first the lessons we can learn from the crisis; second how to move forward to strengthen monetary policy framework in light of the crisis to ensure long-term price and financial stability; and third the relevance of inflation-targeting as a monetary policy framework in the post-crisis era. From the crisis, there are a number of important lessons that can be drawn. The first is that monetary policy remains the right instrument to maintain a low inflation environment which is crucial for sustainable growth. But the most important lesson from the crisis is that low and stable inflation alone is not sufficient for ensuring financial stability. This is because the risk to financial stability can come from many sources other than domestic inflation. In the current crisis, it was the housing bubble and excessive risk-taking by the financial institutions that precipitated the crisis in the environment of stable prices. Therefore, to maintain economic and financial stability, in addition to price stability, attention must be paid to all the key sources of risk and imbalance that can have systemic implications for the economy’s growth and stability. This is the first lesson. The second lesson is the inadequacy of the current approach in monetary policy analysis that focuses over-extensively on macroeconomic analysis and models.
Moreover, with the growing international exchange in almost every economic domain, maintaining taxes in Sweden at a higher  3  BIS Review 77/1999  level than in the rest of the world will become increasingly difficult. But there is reason to deliberate the type of tax cuts that would benefit the Swedish economy most in connection with good growth. Tax reductions with positive supply-side effects — instead of the cuts being discussed, which mainly stimulate demand — would increase the possibilities of combining the good growth with persistently low inflation. Tax and expenditure ratios in 1998 Per cent of GDP 70  70 Tax ratio Expenditure ratio  60  60  50  50  40  40  30  30  20  20  10  10  0  0 Sweden  Euro-10*  * Euro-11 excluding Luxembourg  Källor: Europakommissionen och KI  Interaction with labour market trends Let me now leave monetary policy’s interaction with fiscal policy and consider its relationship with the situation in the labour market. What forms does this interaction take? Monetary policy’s chief contribution to employment lies in the creation of economic stability and clear rules for wage formation. A monetary policy that is predictable and operates with a clear inflation target provides good guidance for wage negotiations. The lack of a properly functioning stabilisation policy was presumably one reason why wage formation did not work in the 1970s and 1980s. The rules of the game were unclear to the labour market organisations.

Growth and inflation in OECD and Sweden 1999 and 2000 forecast Percentage annual change Growth  6 5  6 5  OECD  4  4  3  3  2  2  1  1  0  0  -1  -1  Sweden  -2  -2  -3  -3 8 0  8 2  8 4  8 6  8 8  1 5  9 0  9 2  9 4  9 6  9 8  0 0  1 5  Inflation  1 2  1 2  9  9  Sweden  6  6  3  3  OECD*  0  0 8 0  8 2  8 4  8 6  8 8  * excluding hihginflation countries  9 0  9 2  9 4  9 6  9 8  Source: OECD  Monetary policy, however, is just one of the factors that are important for economic development. Two crucial matters for economic development in general and thereby for the conditions underlying monetary policy are the situation in the labour market and fiscal policy. In recent years it is not least the construction of fiscal policy that has contributed to the good economic performance. The interaction of fiscal and monetary policy has been debated a good deal of late. Income tax cuts have been discussed, for instance.
Market Power and Monetary Policy Speech given by  Andrew G Haldane Chief Economist Bank of England  Co-authors: Tommaso Aquilante, Shiv Chowla, Nikola Dacic, Riccardo Masolo, Patrick Schneider, Martin Seneca and Srdan Tatomir. Federal Reserve Bank of Kansas City Economic Policy Symposium Jackson Hole, Wyoming 24 August 2018  The views expressed here are not necessarily those of the Bank of England or the Monetary Policy Committee. I would like to thank Federico Di Pace, Laure Fauchet, Rebecca Freeman, Jeremy Leake, Clare Macallan, Colm Manning, Roland Meeks, Kate Reinold, Natalja Sekhan, Silvana Tenreyro, Jan Vlieghe and Robert Zymek for their comments and contributions. This work contains statistical data from ONS which is Crown Copyright. The use of the ONS statistical data in this work does not imply the endorsement of the ONS in relation to the interpretation or analysis of the statistical data. This work uses research datasets which may not exactly reproduce National Statistics aggregates. 1  All speeches are available online at www.bankofengland.co.uk/speeches  The topic for this panel is the link between developments in product markets and monetary policy. It is a great one. A lot of attention has been paid by central bankers over recent years to the relationship between labour markets and monetary policy (for example, Yellen (2014) and Constâncio (2017)). And rightly so. The relationship between monetary policy and product markets has, by comparison, been the road less travelled.

14  Within that, this rise in mark-ups among foreign relative to domestic sales-focussed firms is largest in the manufacturing and ICT sectors. Taken together, this evidence is consistent with a story of rising mark-ups being concentrated among internationally-operating firms, who perhaps benefit disproportionately from global network economies of scale and scope. These firms tend to occupy the fat and fattening upper tail of the mark-up distribution. These are firms that might legitimately be termed “superstars” (Autor et al (2017)). Given this diagnosis, what impact might the rise in mark-ups have had on the macro-economy? One aspect is what impact increased market power may have had on firms’ incentives to invest and innovate and hence on firms’ productivity. With investment and productivity each having under-performed over recent years, the relationship with market power has been subject to increased academic scrutiny recently (for example, Eggertsson, Robbins and Wold (2018)). The relationship between mark-ups and productivity is vital in understanding their macro-economic effects (Van Reenen (2018)). On the one hand, if highly productive ‘superstar’ firms, benefitting from network economies of scale and scope, have become more dominant, then higher mark-ups could be the side-effect of a positive supply shock in the economy. On the other hand, if mark-ups are the counterpart to increased market power and reduced competitive pressures, that would suggest a negative supply shock. These effects are not mutually exclusive. For example, Aghion et al (2005) develop a model which generates a concave relationship between competition and investment.
And associated with such a re-balancing, one would expect to see some shift in the structure of production away from sectors focussed on serving domestic needs towards those producing internationally tradable goods and services. The re-balancing should be facilitated by the depreciation of sterling – down around a quarter since the middle of 2007 – but is still at an early stage. Household spending stagnated over 2010 and remains around 4% below its pre-recession level (Chart 2). The sluggishness of consumer spending should hardly be a surprise. Real post-tax labour incomes have been squeezed by a mix of low pay growth and elevated inflation on the back of higher VAT, energy and import prices. In addition, heightened uncertainty probably led some households to increase their savings or pare back their debts. The most recent survey of retailers by the British Retail Consortium suggested that the fine Easter weather and the royal nuptials may have brought a welcome fillip to the High Street, but with the squeeze on real pay likely to continue through this year, it seems likely that consumer spending will remain subdued through this year at least. Public spending will also  1  Though not all: recent employment data, for instance, have been surprisingly robust. BIS central bankers’ speeches  1  provide little impetus to overall activity, given the necessary fiscal consolidation that is now under way. That, of course, is a particular issue here in Northern Ireland. So, the prospect for overall growth depends heavily on business spending and external demand.

Rather the let down has been on the import side, where there has been less substitution of domestically supplied goods and services for imports than past experience would have led one to expect. It is possible that increased specialisation means that demand is less responsive to price than it used to be. Alternatively, heightened uncertainty and the absence of UK suppliers for some sorts of goods and services may mean that it takes longer for import penetration to respond to the enhanced profit opportunities. In any case, the MPC still expects net exports to contribute substantially to the overall growth in demand over the next few years as the necessary rebalancing gradually takes place. The most recent trade figures indicate that net exports of goods boosted GDP by around 1¼ percentage points in the first quarter2, and suggest that we may at last be starting to see a more significant contribution to growth. Chart 4 shows the MPC’s current assessment of the outlook for four-quarter GDP growth, as published last week in the Bank’s latest Inflation Report and assuming that Bank Rate follows the gently rising path implied by market interest rates. The single most likely path lies within the deepest green band. The near-term path is somewhat choppy, reflecting the impact of factors such as the extra bank holiday associated with the royal wedding.
Speeches  Published Date: 13 October 2020  “Harnessing the Power of Finance for a Sustainable Future”- Keynote Speech by Mr Ravi Menon, Managing Director, MAS, at the Financial Times Investing for Good Asia Digital Conference on 13 October 2020 I thank the Financial Times for the opportunity to speak on this important topic and to reach out to an audience across the globe. WHAT HAS COVID-19 TO DO WITH SUSTAINABILITY? The climate crisis is the existential challenge of our time. Never before have the eﬀects of climate change been more keenly felt— soaring temperatures, extreme weather events, rising sea levels. Recent wildfires in Australia and the Western United States are the worst in history. Meteorologists tracking hurricanes across the Eastern United States have run out of names this season. How we deal with climate change will define our future. The Paris Agreement calls for a concerted eﬀort to limit global temperature rise by reducing emissions of greenhouse gases. This call to action for a sustainable future has only grown stronger with the COVID-19 pandemic. COVID-19 has sensitised the world to how vulnerable we all are to the forces of nature. The pandemic has underscored the importance of taking timely and collective actions to mitigate global challenges.

In a final attempt to stop the currency outflow, the Riksbank first raised its policy rate to 75 per cent again on 16 September 1992 and then, at 15:20 on the same day, to 500 per cent. At the same time, the pound sterling and the Italian lira left the ERM and were allowed to float freely. In this situation, the government and the opposition managed to agree on a crisis package that was presented on 20 September, intended to strengthen the state budget by SEK 40-45 billion. The Riksbank then cut the rate to 50 per cent. After a second crisis package at the end of the month, the interest rate could be cut further, to 24 per cent. This calmed the market somewhat and the Riksbank was able to gradually lower the marginal rate to 11.5 percent in the late autumn. However, the calm was only temporary. In mid-November, the outflow of foreign currency began to accelerate again. Repeating the same manoeuvre with a substantial rate increase and further crisis packages was considered pointless – confidence had been exhausted. On 19 November 1992, the Riksbank abandoned the fixed exchange rate. When you go through the press cuttings from this period, it is not very difficult to see an image of how we were desperately using rate increases and hastily concocted fiscal policy agreements in an attempt to patch up and repair a house that was really so run down that it needed to be completely renovated.
And while other countries have cut the number of banks by almost a quarter following the financial and economic crisis in order to reduce overcapacity, the corresponding figure for Germany was only 10%.4  Traditional business models under review The current low interest rate environment has not just revealed weaknesses among banks, it has also called into question the traditional business models of insurance companies and pension funds. 3/5  BIS central bankers' speeches  For many insurers in Germany, guaranteed returns have become an issue. In the current market environment, it is becoming increasingly difficult to achieve the guaranteed interest rates of 4% that were commonplace in contracts concluded in the mid-1990s. The German ministry of finance has reduced the guaranteed interest rate for the current year from 1.25% to 0.9%. Many insurance companies are now increasingly turning to unit-linked products. In addition, new regulatory requirements are increasing the demand for safe assets. German government bonds alone are yielding negative returns on maturities of up to seven years. Against this backdrop, discussions are under way as to what can be done to counter this shortage of safe assets. One suggestion is that market participants create a new kind of safe asset, known as European Safe Bonds (ESBies)5, consisting of the senior tranche of a portfolio of existing bonds from different euro area countries. The advantage here would be that no joint liability would exist, as is the case in other proposals of this kind. From a purely academic perspective, this is certainly an interesting idea.

Zeti Akhtar Aziz: Towards a more efficient payment system – electronic payments Keynote address by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the Mobile Digital Signature Symposium 2008 – "Towards a More Efficient Payment System: Electronic Payments", Cyberjaya, 3 June 2008. *  *  *  It is my honour and pleasure to be here today at this Mobile Digital Signature Symposium 2008 to deliver an address at this important forum. This forum takes place at a time when developments taking place in the global economy are resulting in fundamental changes to our lives. While the global economy has benefited from an extended period of high performance and strong growth, it now requires greater agility to adapt to the rapid changes that has occurred. A major emerging international phenomenon is the rising inflationary pressures. We are now living in an environment characterised by rising prices, with energy and commodity prices prevailing at record highs. Energy and commodity prices which have risen steeply have been driven by demand and supply factors and reinforced by market conditions. Clearly, the global factors that have influenced these international prices are beyond our control. Individually and collectively, we therefore need to adjust and adapt to these new conditions. Increasing efficiency and adopting new business processes needs to be explored to reduce costs.
Some of you may already be aware that the HKMA has begun researching retail CBDCs (rCBDCs). We have been working with the Bank for International Settlements (BIS) Innovation Hub Hong Kong Centre on Project Aurum, which will focus on the technical aspect of issuing r-CBDCs and the possible architectural designs. 24. Similar to the majority of central banks, we see that a lot of issues need to be thought through before issuing r-CBDC. For instance, how should we strike a right balance between privacy and traceability? How do we mitigate cybersecurity risks? How will it affect the effectiveness of monetary transmission? These are important questions that need to be answered before reaching a conclusion. 25. Against this backdrop, the HKMA will soon begin a comprehensive study on e-HKD to understand its use cases, benefits, and related risks. This is to increase our technical readiness so that we are prepared for all kinds of circumstances in the future, including the potential for Hong Kong to issue e-HKD. We have already established an internal crossdepartmental working group within the HKMA to study the relevant technical, policy and legal issues, and we hope to offer our initial thought on this complex matter in 12 months’ time. 26. Needless to say, CBDC will remain one of the most important topics among the global central banking community in the months or years to come. The HKMA will continue to work with the BIS and other international institutions to prepare Hong Kong for the evolving landscape. Creating the next-generation Data infrastructure 27.

Over the past three years, we have made considerable efforts in preparing this competition and seeing it through to its successful conclusion last week. This process has involved not only our own experts, but also external consultants. We would like to take this opportunity to thank all of them for the quality of their work and their genuine commitment to this project. We also very much appreciated the good working relations with the City of Frankfurt authorities, which were of great assistance, and we look forward to continuing this excellent cooperation. We would also like to thank again all the architects who took part in the competition and submitted such a great variety of design proposals. We are especially grateful to the three prize-winning architectural offices which participated in the revision phase of the competition. Over the past 11 months, they have gone into substantial depth to elaborate the details of their design proposals. The high quality and professionalism of the work done in the revision phase was very much appreciated by the Governing Council. The Governing Council’s decision on the design of the ECB’s premises was reached after extensive discussion and careful evaluation of the prize-winning designs. As a public institution, we are committed to performing our tasks effectively and to using our financial resources prudently. Therefore, it was essential to have a thorough and comprehensive assessment - even if that prolonged the process somewhat - so as to make the right decision on a matter of such symbolic and financial importance.
2/4  BIS central bankers' speeches  12.Regtech developments are growing rapidly particularly in the areas of transaction monitoring, regulatory reporting, risk management and compliance. According to a recent report, investment in Regtech companies reached $ billion globally in 2017. But why is Regtech gaining popularity? I believe there are three key drivers: 1. First is the increase in the complexity and scope of more stringent regulations globally such as Basel III and enhanced standards for combating money laundering. A few recent studies have suggested that the volume of global regulatory changes went up by at least five-fold in the past decade. Hence, there has been a growing desire of the banking industry, particularly in jurisdictions with more daunting regulatory requirements, to explore the use of new technologies to enhance the effectiveness and lower the cost of their compliance efforts. 2. The second driver is the sheer volume of transactions and data that many banks need to handle as the economy and business continue to grow. If we take the mobile wallet market as an example, research predicts cumulative annual growth of 32% in global e-wallet transactions between 2017 and 2022. Such a scale of transactions means it would simply be impracticable for some banks and e-wallet operators to effectively manage the associated risks using traditional or manual risk management approaches. 3. The third and final driver is the higher availability of Regtech solutions.

It also gives due protection to the consumers of Islamic finance, ensures the enforceability of Islamic financial contracts and provides an effective mechanism for legal redress. The legal framework for Islamic finance also needs to address any specific elements that could result in a comparative disadvantage to the industry. More specifically, in a world in which finance has long been defined by conventional practices and laws, the features that are unique to the requirements of Islamic finance need to be taken into account to ensure neutrality of treatment. In Malaysia, the rapid evolution of Islamic finance has been supported by the development of a comprehensive legal infrastructure. A series of legislation since 1983 has provided the foundation for a regulatory regime for Islamic banks, takaful operators, the Shariah Council for Islamic finance, Islamic finance windows in conventional banks and the various forms of bond and money market instruments. In addition, the corporate, securities and insolvency laws and guidelines are compatible with the Shariah. These legislation have been reinforced by the establishment of a dedicated High Court bench to provide a comprehensive adjudicative system to deal with disputes involving Islamic finance. In addition, the new Islamic Finance Arbitration Rules of the Kuala Lumpur Regional Centre for Arbitration provides a customised mechanism for the resolution of disputes in the Islamic financial services sector. The development of an efficient and vibrant Islamic financial market Equally important to the development of Islamic finance is not only the financial intermediaries but also the Islamic financial markets.