samchain/econo-pairs-v1 huggingface dataset:
Concluding remarks Let me end my talk today by saying that, as a central banker, we should be ambitious in making the best use of all available policy tools and in improving our understanding of the economy as well as the shocks driving it. But setting the ambition higher than the capability of monetary policy would likely prove to be counter-productive. It is an old established wisdom that what monetary policy can best deliver is price stability. While we have learned for a great deal about other aspects of macroeconomic stability, there is little disagreement that price stability must remain the central objective of monetary policy in the long run. Abandoning this objective risks de-anchoring price expectations and inducing unnecessary economic volatility. The deployment of supplementary tools can go some way to help relax its limitation, but monetary policy is no panacea. Ladies and Gentlemen, Only by understanding both the power and limits of monetary policy, will the economy be able to reap the most benefit out of this policy lever. The Bank of Thailand will continue to do our utmost to strive for overall macroeconomic stability, and the long-term prosperity of Thailand. Thank you. 4  BIS central bankers’ speeches

with perfectly controlled deficits and levels of public debt, which logically places limits on the growth of public debt markets. This contradiction is known by economists as the “Triffin dilemma”. It was first identified in relation to the U.S. balance of payments deficits and the value of the dollar, but it can also be applied to fiscal equilibrium. The economy needs a growing volume of risk-free assets, but the more they are issued, the more risky they become. We cannot totally side-step this dilemma, but we can avoid making it worse. It is clearly not good for major developed countries to find themselves in a situation where their solvency is put into question, or to allow markets to think that under certain circumstances, they may be unable to honour all their commitments. But this is what we have done in Europe, against the better judgement of the ECB, by introducing the principle of private sector involvement. The idea is attractive in theory. However, its consequences for financial stability are extremely negative. There has never been any doubt about whether the United Kingdom or the United States would honour their debts. Today they are enjoying very favourable interest rates compared with Spain and Italy even though the latters’ fiscal fundamentals are better. I know that some attribute this difference in borrowing conditions to the actions of the UK and U.S. central banks. I do not agree.
(a) Shading is based on a score that reflects gross issuance (relative to nominal GDP) and spreads in primary markets, and spreads in secondary markets, expressed as a number of standard deviations from its historical averages, using as much data as available data from January 1998. Primary market indicators reflect the past three months, so smooth volatility. Where spreads are not available, indicators are based solely on issuance. (b)  2  Latest data point is August 2013. BIS central bankers’ speeches  Given such benign conditions it seemed natural to ask whether firms were prepared for the risk of a sudden change in conditions – in particular the possibility of a snap back in interest rates at some point. In early April, such questions to contacts usually evoked a blank response! Those who had been betting on rates rising had consistently lost money and such positions generally had been cut. There were few visible signs of any increase in hedging activity other than reports that some investors preferred floating rate rather than fixed rate products at the margin. A lot of faith seemed to be enshrined in the ability to anticipate the FOMC: that it would signal clearly and early what its strategy would be, leading to a smooth exit from its policy stance. Altogether the market was ripe for some volatility consequent to a change in the policy outlook. That volatility duly arrived. The initial catalyst was the strong US non-farm payrolls data on May 3rd after which longer term yields started to rise.

Jean-Claude Trichet: Financial integration, development and stability – lessons from the crisis (introductory remarks) Speech by Mr Jean-Claude Trichet, President of the European Central Bank, at the conference “Financial integration and stability: the legacy of the crisis”, sponsored and organised by the European Central Bank and the European Commission, Frankfurt am Main, 12 April 2010. *  *  *  Ladies and Gentlemen, I would like to welcome you to this conference on financial integration and stability, jointly organised by the ECB and the European Commission. I would like to thank in particular Commissioner Barnier for participating in this event, and his services for the smooth coorganisation of it. This joint conference is an illustration of the very good cooperation that exists since a long time between the two institutions. The European Commission is in the driving seat on all what concerns financial integration. The ECB also a strong interest in this topic, because of the implications for the single monetary policy, our primary mandate, and also on financial stability and the operation of payment systems, areas where we have a statutory responsibility. The very good cooperation between our institutions has intensified in the wake of the financial crisis. Let me just mention the recommendations and guidance we developed in the course of last year on support measures for banks in difficulties. This joint work limited the risk of unilateral and uncoordinated support measures by governments and was therefore crucial in maintaining a level playing field and in preserving the Single Market.
Emerging Market Forum – Paris, 16 May 2022 Welcome remarks: “Multipolarity and the role of the euro in the International Financial System”  Speech by François Villeroy de Galhau, Governor of the Banque de France  Page 1 sur 7 Ladies and Gentlemen, It is a great pleasure to welcome you today in Banque de France premises for the 15th Emerging Markets Forum. “Navigating in a fast moving and turbulent world” certainly requires great skills, and recent developments in the International Financial System remind us that it is currently all but smooth sailing. We have seen disruption in the global value chains due to the still ongoing pandemic. International trade may slow down or even contract if these disruptions lead to a significant wave of re-shoring. Now the brutal war in Ukraine has induced further supply disruptions and led our democratic leaders to use financial sanctions in response. In this uncertain situation, our first duty as a central bank is to provide appropriate monetary policy. The consensus in our Governing Council is now clearly emerging, as summed up by Christine Lagarde in her speech last Wednesday i: to fight an inflation which is not only higher but broader, we now have to normalise our monetary policy. I won’t add my precise calendar prediction to the many existing ones, but expect a decisive June meeting, and an active summer.

According to SWIFT data, almost 40% of transactions are denominated in euro. It truly is the second most important currency in the world after the dollar. The European Commission has recently taken steps to further strengthen the role of the euro, which are most welcome. iv Among other things, the Commission has launched the Capital Markets Recovery Package that introduced targeted amendments needed to develop euro-denominated derivatives for energy and raw materials. 1. Supplying euro denominated safe assets and enhancing Capital Markets Union An international currency is only as strong as the safe assets it can offer. The euro sovereign debt market is still fragmented and only a few Member States are issuing global assets in a sufficient quantity. In this regard, there have been interesting recent developments in Europe. In June 2021, Europe launched Next Generation EU (NGEU) which will raise over 800 billion euros through a joint issue of European bonds. More broadly, the deepening of European Capital Markets Union should, at end, be instrumental. v It would help both for the allocation of capital within the euro area and for the stability and balance of the International Financial System. Such an initiative is important as we face new policy challenges. The transition to a greener economy will require immense financing, and the digital transformation will also require both public and private investments. This all calls for investments in global public goods to be increasingly managed at the EU level. Two open questions remain.
Firstly, monetary policy is not able to precisely fine-tune the output gap or employment. As I said earlier, it takes times for monetary policy to have an impact on inflation, which is why the Riksbank’s monetary policy decisions are based on a forecast of expected price developments in the future. Furthermore, our knowledge of the output gap even now is not exact, and even less so for the coming years. In reality, shocks to supply and demand are occurring all the time, which influence both actual and potential output. As a result, the output gap is almost never zero. In addition, each forecasting period has its events and political decisions that not only are difficult, but impossible, to foresee, a good example being the terrorist attacks on 11 September 2001. For that reason all forecasts will be more or less inaccurate, and the output gap will be positive or negative for long periods. The important thing is that the Riksbank, in attempting to stabilise inflation, strives to achieve as small and as short-term deviations from the inflation target as possible. With a symmetric inflation target like the Riksbank’s, the incentives and our efforts to avoid missing the target on the upside and the downside are equally strong. Short-term deviations from the inflation target thus will even themselves out over time and will not result in any permanent gains or losses in terms of growth or jobs.

Between 1975 and 1995, Swedish inflation averaged 8 per cent a year. Real wages rose by only 0.5 per cent a year. Swedish companies’ competitiveness deteriorated and industrial production dropped. Sweden slipped from 4th place in the OECD’s standard-of-living league to 18th place – below the average for OECD countries. We became a relatively poor country in Europe and the industrialised world. Meanwhile, deregulation in the credit market during the 1980s resulted in a sharp expansion in credit, with an accumulation of debt among the general public as a consequence. Demand increased but supply was weak and productivity growth low. The economy overheated, inflation picked up and competitiveness was eroded. In 1990, the international economy began to weaken and prices of assets and property fell. The economic climate deteriorated dramatically and eventually the banking crisis hit the country, with large loan losses as a result. The Riksbank defended the fixed krona exchange rate to the very last, but after large currency flows and extreme rises in interest rates the fixed exchange rate was abandoned on 19 November 1992. The outcome of the performance during the 1970s and 1980s was that we slipped down the standardof-living league, suffered mass unemployment and saw a drop in GDP of 4-5 per cent. It was at this juncture that an explicit inflation target was introduced. The depreciation of the krona in 1992-93 of almost thirty per cent gave the manufacturing industry a powerful boost.
Jaime Caruana: Concluding remarks - conference on “Central Banks in the 21st Century” Speech by Mr Jaime Caruana, Governor of the Bank of Spain and Chairman of the Basel Committee on Banking Supervision, at the conference on “Central Banks in the 21st Century”, hosted by the Bank of Spain, Madrid, 9 June 2006. *  *  *  It is my pleasure to participate in this concluding session of the conference and to be accompanied at this table by Pedro Solbes. I hope you found the presentations and discussions inspiring and motivating. I certainly did. We are now witnessing some profound changes in the way our societies organise their economic relationships, and these naturally pose new challenges to central banks, regarding both their role of monetary policymakers and their responsibility to preserve and foster safer and more efficient financial systems. Over the last two days we have discussed some of the underlying forces of change and their implications for the design of sound monetary policy and financial architecture, including the question of how best to arrange payment and security settlement systems. Let me briefly elaborate on some of the issues raised at the conference which I found particularly interesting. I will first reflect on the difficult question of how monetary and financial stability relate to each other and then move to some particular issues of special interest for a currency area, such as Economic and Monetary Union (EMU).

I have, however, for the reasons I mentioned earlier in my speech, been somewhat more pessimistic than the majority of the Executive Board as regards inflation assessments at the forecast horizon. Fluctuations of consumer prices a few tenths of a percent up and down around the target in an economy with a strongly accepted price stability regime are per se less important than the mode of functioning of the economy. I am more concerned about what can happen with inflation and growth after the forecast period if demand increases at the rate we have anticipated. The simple rule that says that monetary policy shall only react if the target for inflation is not met during the forecast period is a good help when conducting monetary policy. However, it is not reasonable to mechanically apply this rule in every situation. The consequences that the economic development can have for macroeconomic stability and inflation beyond the forecast horizon must also be weighed in. The risk for financial imbalances now being built up when indebtedness is increasing and of inflationary pressure accumulating at the same time must in my view therefore be taken into account in the monetary policy decisions. A development that I described earlier can be the consequence if the expansion of demand and credit continue to increase at a high rate. The quantity of money and lending, especially to households, are for instance increasing at present at a rate which is probably not sustainable in the long term.
Growth in real wages has been negative for all bar three of the past 74 months. The cumulative fall in real wages since their pre-recession peak is around 10%. As best we can tell, the length and depth of this fall is unprecedented since at least the mid-1800s (Table 1). •  Productivity – GDP per hour worked – was broadly unchanged in the year to 2014 Q2, leaving it around 15% below its pre-crisis trend level. The level of productivity is no higher than it was six years ago. This is the so-called “productivity puzzle”. 1  House prices are measured using the average of the Halifax and Nationwide indices. 2  Okun’s original misery index, which was also referred to as the “discomfort factor”, comprised unemployment and inflation. 3  Adding real wealth and/or real borrowing costs to the index does not alter the underlying trends. 4  The value for 2014 is an estimate based on projections consistent with the August 2014 Inflation Report. 2  BIS central bankers’ speeches  Productivity has not flat-lined for that long in any period since the 1880s, other than following demobilisation after the World Wars. •  Annual real interest rates – for example, rates earned by households on time deposits adjusted for consumer price inflation – are around zero. They have been near-zero for close to four years. Real deposit rates have not been that low since the 1970s, when inflation was in double digits.

These include changes that have heightened competition and which have fostered the emergence of increasingly diverse market participants and organisations. The dramatically changing landscape calls for a new generation of highly-qualified professionals equipped with more comprehensive skills. To support and sustain these developments, the education system must evolve so as to meet these new demands. Against this backdrop, our ability to sustain long-term growth clearly depends on our ability to build, maintain and continuously expand our knowledge base. The key to this process is thus to be able to adapt to the new environment. As Charles Darwin observed "It is not the strongest", "nor the most intelligent that survive" but it is those that are "the most responsive to change." It is this capability that needs to be cultivated to ensure a mobile and agile work force that can adjust and respond to the emerging developments in the changing environment. As graduates today, you embody the hopes of the nation in making the transition towards a knowledge-based economy a reality. In graduating today, you would have achieved an important milestone in your life. This is indeed an important and distinct mark of success for all of you. Not so much because of the degree which you now hold in your hand, but more importantly its promise for your future. Your journey to reach this moment is a testimony of your own individual potential, determination and hard work. BIS Review 3/2006  1  The learning experience, however, needs to go on.
Will access to credit markets be restored in the near future, so that we can strengthen our foreign exchange reserves and begin lifting the capital controls soon, without jeopardising the exchange rate of our currency or worrying about upcoming payments on the Treasury’s foreign loans in the winter of 2011–2012? Or are we faced with a situation where access to foreign credit remains limited and the capital controls must stay in place much longer than we had hoped? It will then become critical to eliminate this uncertainty. If the conclusion is that we must maintain the capital controls longer than originally intended, and if access to further foreign credit is not forthcoming except at usurious rates, we will have to draft an economic policy that takes account of these circumstances. In that instance, strong emphasis would be placed on preventing the nation’s foreign exchange reserves from becoming dangerously depleted following payments on Treasury loans in the winter of 2011– 2012. Fiscal policy would have to be tighter than is currently planned. As regards monetary policy, two factors would tend to offset one another: the economy would be weaker, but the exchange rate would be lower. The more effective the capital controls are, however, the lower interest rates can be. This could also mean that the Central Bank would purchase foreign currency in the market in order to strengthen its reserves in advance of the loan payments, and that, in turn, would mean a lower exchange rate.

Janet L Yellen: Views on the economy and implications for monetary policy Speech by Ms Janet L Yellen, President and CEO of the Federal Reserve Bank of San Francisco, at the Portland Community Leaders’ Luncheon, Portland, Oregon, 29 July 2005. *  *  *  Thank you for that very kind introduction. It’s a pleasure to be here with you in this beautiful “City of Roses.” As a monetary policymaker, my main concern is the national economy, and that will be the chief focus of my remarks today. But as President of the San Francisco Fed, I also pay close attention to developments here in the Twelfth District, which, in many respects, mirror those of the nation. Looking at the big picture elements—growth, employment, and inflation—I’d say things are in reasonably good shape. Over the past two years, the nation’s output growth has been pretty steady, averaging just over four percent; this is solidly above trend, which, by most estimates, is around three and a quarter to three and a half percent. This growth has been amply in evidence here in the Pacific Northwest. While unemployment rates in Oregon and Washington remain above the nation’s rate, your region has largely recovered from the severe hit you took during the 2001 recession and its aftermath. As a result of sustained growth at the national level, slack in labor and product markets has trended down.
Deregulation has been the catalyst – the more cynical would say the excuse – for banks to introduce fees and charges on deposit accounts. Most banks have also introduced tiered savings accounts, with higher interest rates being paid on larger balances. Sometimes the rate depends on the range of the bank's products and services that the customer uses. The converse is that some banks are now paying less than the standard rate on small deposits. A further innovation is that in a few cases there are savings products that are linked to HIBOR. Banks have not rushed to pay interest on conventional current accounts, though some have offered combined savings and deposit accounts that pay interest. At least one bank offers an auto-sweeping service from savings to current accounts. Such products are effectively offering interest on current accounts. Generally speaking, the amounts deposited in the innovative current and savings accounts are still quite small. Perhaps the biggest surprise so far has been that some of the banks have been able to lower their benchmark savings account rate to 1.75%, which is probably 25bp below what it would have been without deregulation. A few years ago, when the debate about deregulation was taking place, the conventional wisdom was that the savings rate was artificially depressed and would rise closer to time deposit rates after the cap was lifted. So far this has not been the case. Indeed, it appears that the interest rate rules effectively imposed a floor as well as a cap.

It is all too easy for market participants to assume that they will be protected from the negative effects of their own actions during a crisis. Central banks need to keep a close eye on this moral hazard problem, and if necessary take steps to contain it through appropriate regulation.