samchain/econo-pairs-v1 huggingface dataset:
BIS Review 39/2000  2  Let us make a comparison between the period starting with the recession of the early 1970s up to 1989, when annual inflation averaged over 9.5%, and the period from 1993, ie the end of the last recession, up to now, with an average inflation rate of just over 1.5%. Broadly speaking, the latter period presents a brighter picture. The total rate of investment, measured in terms of year-on-year changes, is higher on average during this period, especially if investments in housing are excluded. The average productivity of the economy as a whole is broadly the same during the two periods. However, behind the average during the first period lay some years of very strong growth in productivity in the early 1970s, offset by poor productivity growth during the 1980s. The Swedish economy has grown by 2.3% on average since the start of 1993. This is only slightly higher than growth during the period 1971-1989. However, the composition of growth is different in the two periods. During the second period, growth in industry has been just under 3.5%, which is about 1% higher than during the previous period. The difference in growth would also be more marked if the latter period were to start only six months later. Average growth from mid-1993, when the recession levelled out, to the end of 1999 was 2.9%. Diagram 2. Gross investment, total and excluding housing  Gross capital formation 7 6  7 Total Excl.

I will mainly therefore in my talk today direct my remarks mostly at the problems of good governance, competitiveness, transparency, righteousness and public policy in the private sector, in the government and in the financial system. I shall also mention specific situations which, though in the long term would not be significant, in the short term could upset the pace of the recovery and unsettle the good macroeconomic situations that we find ourselves in as I have just mentioned. Let me first pick a simple governance and transparency topic, our homepage. In the financial sphere, we have been trying to improve governance and transparency by improving the information available so that the decision-makers, be they financial institutions, foreign investors or locals may have easy access to accurate information and in so doing will become better decision-makers, whilst the transparency and availability of information on particular topics will force better behaviour by peer group behaviour or public pressure as the case may be. We have been improving the homepage tremendously in the last couple of years and the extent of information available, as quite a lot of people say, is good. But we still find, I still think, very much wrong with it. Firstly it is not very user-friendly. The format is amateurish and there are no “search” and “help aid” for users.
The new environment  But the financial world today has globalised both across borders and different kinds of firms. Risk transfer processes have mushroomed. And there has developed a corresponding will and ability to exploit them. The new world is characterised by new concentrations of risk. They can be built - and dissipated - with bewildering speed. Before looking at the consequences of the changes for financial stability oversight it is worth reflecting on the main causes of this new world. There are of course many drivers, but to my mind development of the new products and risk transfer techniques is based on the precondition of liberalisation and technological advance. 5. Liberalisation  As to liberalisation, it was little wonder that the rise in popularity of derivatives in the global economy was stimulated by the emergence in the 1960’s of that most liberal of markets: the international capital market. This burgeoning and open market place provided the preconditions to develop the new techniques. Regulation was minimal and market imposed. Disintermediation and securitisation gathered pace from the early 1980’s. And as derivative instruments were developed, newly emerging players including hedge funds and others entered the scene. So today we see a global market place of truly astonishing size and breadth where contracts straddle both national boundaries and the old functional areas of banking, insurance, and securities: and where the old silos are no more. The international capital market was itself in my view a major stimulus in encouraging individual governments to liberalise their markets.

In addition, the rise in longer-term rates constrains economic activity – making it even more difficult to sustain an economic recovery. Moreover, once confidence begins to erode, it can do so very quickly. Even if a country were willing to pay higher interest rates, this path is not viewed as credible given the implications such rates have for future debt service costs and deficits. Put simply, to wait and see ultimately is likely to necessitate an even bigger fiscal adjustment. In addition, waiting for the market to say “no more” may mean losing discretion as to the timing and magnitude of fiscal tightening. It is very unlikely that the time when market sentiment turns most adverse would also be the most attractive time to have to tighten fiscal policy. Thus, there is a balancing act between solving the longer-term problem of needed fiscal consolidation and, at the same time, not tightening fiscal policy too soon or too abruptly so as to derail the nascent expansion. So what should be done? I believe that moving ahead earlier with a credible plan is preferable to waiting. I am not going to enter a political debate about whether the restraint should be more in the form of higher taxes or lower spending. However, I do believe, like most other economists, that fiscal consolidation that has the least negative impact on investment in physical and human capital is bound to be most effective. That is because fiscal capacity depends on economic capacity.
As a result, country-specific factors have become less important in determining corporate bond prices and spreads. Cross-border holdings of long-term debt securities of monetary financial institutions grew from about 15% in 1999 to nearly 40% in 2007. Integration in the equity markets is less advanced but shows signs of improvement. Between 1997 and 2006, euro area investors doubled their holdings of equity issued in other euro area countries to 29% of their total portfolio of euro area equity assets. The retail banking segment has remained more fragmented. In particular, the euro area cross-country dispersion of bank interest rates, especially of interest rates on consumer loans, has remained relatively high. This reflects different conditions in national economies (e.g. credit and interest rate risk, size of firms, industrial structure and degree of capital market development), institutional factors (e.g. taxation, regulation, supervision and  2  BIS Review 20/2009  consumer protection) and financial structures (e.g. degree of bank/capital market financing and competitiveness). It was probably overoptimistic to expect a faster convergence in this segment. The creation of the euro also gave rise to expectations of a broad based convergence of underlying economic developments. These expectations were quite varied, in fact. Some people expected greater divergence as a consequence of specialisation. Others expected greater convergence. The result is mixed. Some convergence has been observed, in particular in terms of business cycle and dispersion across countries, which is comparable with that among the US states.

To complete the picture, net wealth has also risen across the majority of regions since 2008, on average by 13% (Chart 13a). In only three regions (the North East, East Midlands and West Midlands) has net wealth fallen. These patterns are broadly as we would expect if monetary policy has loosened credit conditions, boosted asset prices and wealth and thereby supported domestic demand, at least in the short-run. That said, this is a rather imperfect experiment. Factors others than monetary policy are also likely to have contributed to movements in GDP, unemployment and wealth (in particular housing wealth) over that period. To pinpoint the specific contribution made by monetary policy, we need a model of the economy. By using the Bank of England’s suite of macro-economic models, we can quantify the specific role played by monetary policy in explaining movements in incomes and jobs, albeit rather imperfectly given that all models are imperfect. Charts 11b, 12b and 13b plot the change in real GDP per head, unemployment and wealth respectively since 2008, under the hypothetical assumption that monetary policy had not been loosened over the period but had remained at levels prevailing in 2008. 17  This paints a stark picture of what might have been in the  UK. 16  This is set against a trend decline in global real interest rates and what economists refer to as the ‘neutral’ level of interest rates.
The first two stages – preliminary inquiries conducted through phone and Internet surveys – gauged how individuals interpreted the Michigan Survey questions and how they would respond to alternative questions about future inflation. The Internet survey also “piloted” questions on wage expectations and inflation uncertainty to expand the information currently elicited by the Michigan Survey. These preliminary inquiries guided the final formulation of the questions for the third stage – the actual implementation of  BIS central bankers’ speeches  3  an alternative experimental Internet survey of inflation expectations using a sample panel of households drawn from previous respondents to the Michigan survey. Reliable measurement requires that respondents agree with one another – and with economic modelers – on what the survey questions mean. For the questions asked in professional surveys, there is little room for differing interpretations of the inflation concept since forecasts for a specific price index are requested. For questions asked of households, specific price indexes are not used so respondents vary in their interpretation of the inflation concept. Thus, their responses may display disagreement not about expectations but the concept of inflation being used. Indeed, one feature that the Michigan Survey’s question about “prices in general” shares with other surveys is a high dispersion of responses around the median. This evidence of disagreement is in part related to observable characteristics of respondents such as age, gender, education and income. However, the differences in responses across demographic groups far exceed the variations in inflation experienced by the groups.

Before turning to the focus of this talk – the measurement of household inflation expectations – I want to provide a quick summary of market-based and professional surveys. The difference in yields between nominal and real government debt can be used to derive a measure of market inflation expectations for the price index used to protect the holders of real government debt from inflation. In the United States, that price index is the consumer price index (CPI). Thus, if the nominal 10-year yield is 3.5 percent and the real 10-year yield is 1 percent, one crude measure of average CPI inflation expected over the next 10 years would be 2.5 percent. Further, if the nominal 5-year yield is 3 percent and the real 5-year yield is 0.2 percent, then a crude measure of average CPI inflation expected over the next 5 years would be 2.8 percent and a crude estimate of the 5- to 10-year forward average CPI inflation would be 2.2 percent. BIS central bankers’ speeches  1  I say crude because such calculations ignore any difference in liquidity between and within the two types of debt, any compensation investors require for the uncertainty of the real value of nominal coupon securities and a variety of other issues, such as the fact that Treasury Inflation-Protected Securities (TIPS) are indexed to the CPI with a time varying lag. There are numerous ways to measure inflation expectations that take into account liquidity differences.
Rodrigo Vergara: Global liquidity, spillovers to emerging markets and policy responses Opening remarks by Mr Rodrigo Vergara, Governor of the Central Bank of Chile, at the XVII Annual Conference on “Central banking, analysis and economic policies” of the Central Bank of Chile, Santiago de Chile, 14 November 2013. *  *  *  I thank Claudio Raddatz, Luis Oscar Herrera, and Consuelo Edwards for helpful comments. Good morning. Welcome to the Central Bank of Chile’s Seventeenth Annual Conference on Central Banking, Analysis and Economic Policies. This year, our conference focuses on “Global Liquidity, Spillovers to Emerging Markets and Policy Responses”. You will probably agree with me that this is a very timely topic. The global financial crisis that started in 2008 prompted a quick and decisive reaction of monetary authorities around the world. The central banks of most countries soon slashed interest rates to boost their economies, and implemented various types of facilities to inject liquidity into troubled financial markets. However, while most emerging markets reversed some of these policies as their economies recovered, advanced economies have maintained historically low interest rates and engaged in unconventional policies that last to these days. I will discuss today some of the policy issues around these developments and share some thoughts about the pending research questions along the way. These years of global liquidity expansion have coincided with a surge in gross capital inflows into emerging markets, a real appreciation of their currencies, and an increase in the prices of their main commodities, stocks, and houses.

2  BIS Review 79/2005  3. How have firms reacted to these changes? The banking industry has, not surprisingly, responded to these changes by paying greater attention to liquidity risk management. And, as well as day-to-day management, banks have given more consideration to how they would cope with extreme or ‘tail’ events. Banks have developed, or are at least in the process of developing, sophisticated scenario analyses, and are assessing the contingency arrangements that would be required to respond to these scenarios. It is certainly encouraging to observe the determination with which many banks are addressing liquidity risk, and it is at the same time noteworthy how efficiency drivers have led many banking groups to take a more centralised approach to liquidity management. But, despite the progress that banks are making in addressing liquidity risk, the framework that underpins their contingency plans makes a number of assumptions, particularly regarding access to funding markets. There seems, for example, to be a widespread view that, whatever has happened to a firm’s access to wholesale unsecured funding, it will be able to borrow secured against good collateral. Lying behind this is probably an expectation that national authorities, and in particular central banks, will be ready to provide liquidity against good collateral in the event of the failure of one or more of the markets for secured borrowing.
This is the first step towards Bulgaria’s full integration into the euro area, i.e. to the core of the European Union, an act the importance of which goes far beyond the banking and financial sector. In a matter of days, on 1 October, the Bulgarian National Bank, through its banking supervision, will become the first Bulgarian institution that is a full-fledged member of an important euro area institution – the Single Supervisory Mechanism. This, inter alia, is a notable example of institutional development. Only a few years ago the supervision was one of the most vulnerable and most criticized regulatory institutions in the country. Now, it is one of the most sound and strong institutions, unanimously welcomed to the family of EU banking supervision. This example of institutional development may also be applied in other important areas. This will allow us to cope not only with the challenges of the present but also of the future day. Please allow me to end on this note and to thank you sincerely for the privilege to be with you on this day and to wish you a successful academic year. 2/2  BIS central bankers' speeches

Our ongoing focus on international standard setting and policymaking, including in relation to climate change  The final aspect of competitiveness I would like to discuss today is the future role of the PRA and  6  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  6  UK in shaping policy and engaging with other regulators at an international level. Even prior to withdrawal from the EU this was an area in which the PRA invested considerable time and effort, and post-departure this assumes even greater importance – now more than ever, it is important that the UK view and experiences are captured as part of international standard setting process. We are well positioned here given that Vicky Saporta, our Executive Director of Prudential Policy, also serves as Chair of the International Association of Insurance Supervisors (IAIS). Why is this important to UK competitiveness? International standards aim to create a common language for the supervision of internationally active insurance groups; to level the playing field internationally for insurers; and to simplify regulation for large international groups. To this end, the implementation of common international standards should serve to reduce barriers to cross border insurance activity globally, allowing for new international activity and removing friction where this is already taking place. Ensuring that the UK views are reflected properly in any international standards that are created reduces the risk that UK insurers are faced by regulatory regimes that are not wholly compatible with their business models and lines of business.
It could also be justified if there is a desire to avoid worst-case outcomes and the costs of crises are uncertain. 19  11  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  11  The longer timeframe better captures the prolonged build-ups in credit that precede financial crises in the data, as well as the longer implementation lags involved in setting macroprudential policy. Chart 8 uses the baseline calibration from Aikman et al (forthcoming), which sets 𝜅 = 1, larger than usual in 20  the literature given the longer timeframe, and sets 𝜎 = 0.6. A 1pp tightening in the CCyB increases spreads by 20 basis points (𝜓 = 0.2), while higher spreads have a larger effect on demand (𝜔 = 1) than supply (𝜈 = 0.4), so all else equal inflation falls when the CCyB is tightened. Absent policy, 3 year cumulative real credit growth is assumed to equal its recent UK average of 21% (𝜙0 = 0.21), which can be reduced by higher interest rates (𝜙𝑖 = −1.5) or credit spreads (𝜙𝑠 = −6). The trade-off curves in Chart 8 are derived under the assumption that there is a 5pp per year positive credit shock for 3 years, (𝜉1𝐵 = 𝜉1𝐵 = 0.15). With no policy response, such a shock would increase the crisis probability by 2.75pp. Because the shock is purely domestic, this is smaller than the effect of the global shock examined in Chart 3.

Think Global, Act local Speech given by Minouche Shafik, Deputy Governor, Markets and Banking  Joint Bank of England, IMF and Hong Kong Monetary Authority conference on Monetary, Financial and Prudential Policy Interactions in the Post-Crisis World, Hong Kong 24 October 2016  I would like to thank James Benford, Ambrogio Cesa-Bianchi, Fernando Eguren Martin, Julia Giese, Sujit Kapadia, Grellan McGrath, Michael McLeay, Dennis Reinhardt, and Simon Whitaker for their assistance in preparing these remarks. I am grateful to other Bank colleagues for useful comments on an earlier draft. 1  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  Introduction  The benefits of open capital markets are clear. They facilitate the flow of finance to where it would be most productive and help ensure global resources are allocated most efficiently. They allow savers and investors to diversify portfolios beyond national borders, and they provide a greater range of funding sources to fast growing economies and businesses. Motivated by these gains from openness, greater capital mobility has been one of the defining features of the global economy since the end of the Bretton Woods era, as first advanced and then emerging market economies liberalised their capital accounts (Chart 1). However, open capital markets also come with risks. Breaking the link between domestic saving and domestic investment allowed countries to accumulate ever larger stocks of external assets and liabilities. And that has contributed to another defining feature of the global economy since the breakdown of Bretton Woods: a significantly greater frequency of crises.
The news is mostly good—longer-run inflation expectations in the United States have remained remarkably stable at levels broadly consistent with the FOMC’s longer-run goal. Inflation uncertainty has increased, but this does not appear to be due to unmoored longer-run expectations. The one surprising wrinkle worth further study is the increasing divergence in views about future inflation, including the high share of those expecting deflation, and what this portends for the future. Table and Figures References Armantier, Olivier, Fatima Boumahdi, Gizem Kosar, Jason Somerville, Giorgio Topa, Wilbert van der Klaauw, and John C. Williams. “What Do Consumers Think Will Happen to Inflation?,” Federal Reserve Bank of New York Liberty Street Economics, May 26, 2022. Armantier, Olivier, Leo Goldman, Gizem Kosar, Giorgio Topa, Wilbert van der Klaauw, and John C. Williams, “What Are Consumers’ Inflation Expectations Telling Us Today?,” Federal Reserve Bank of New York Liberty Street Economics, February 14, 2022. By continuing to use our site, you agree to our Terms of Use and Privacy Statement. You can learn more about how we use cookies by reviewing our Privacy Statement. Armantier, Olivier, Gizem Kosar, Jason Somerville, Giorgio Topa, Wilbert van der Klaauw, and John C. Williams. “The Curious Case of the Rise in Deflation Expectations,” Staff Report 1037, October 2022. Board of Governors of the Federal Reserve System, Statement on Longer-Run Goals and Monetary Policy Strategy, January 24, 2012. Board of Governors of the Federal Reserve System, 2020 Statement on Longer-Run Goals and Monetary Policy Strategy, August 27, 2020.

Governor’s Feature Address at the Khazanah Megatrends Forum 2022 Speaker: Tan Sri Nor Shamsiah Mohd Yunus / Venue: Kuala Lumpur / Language: English / Speech/Interview Date: 03 Oct 2022 /  Navigating Malaysia's Economic Transition, in a post-COVID world 1. A very good afternoon to all of you. I would like to thank Khazanah for inviting me to speak. This morning, I will be pleased to share with you what we in Bank Negara Malaysia are seeing in the economy today, and what we believe is needed to secure our future. 2. For a good part of the past three years, the world has been grappling with managing not only a health crisis, but an economic crisis. Actions were taken to protect both lives and support people’s livelihoods. Following the warp speed effort to vaccinate the country last year, containment measures were soon lifted and borders reopened. Today, the economy is no longer in a crisis, and Malaysia’s economic recovery is well underway. A number of key indicators support this. 3. First, the Malaysian economy is showing positive growth momentum. This year, growth is expected to be strong. The reopening of international borders has and continues to lift tourism-related sectors. This will have significant spillovers to the rest of the economy given the importance of the services subsectors. Also, investment activity and prospects continue to be supported by the realisation of multi-year projects.