samchain/econo-pairs-v1 huggingface dataset:
We may not see the effects of these reforms right away but we must continue pressing on with the reform effort and not let reform fatigue get in our way. Productivity also depends on the availability and quality of public goods. With a strong fiscal position, the Thai government this fiscal year has opted to pursue much needed infrastructure projects. Key infrastructure investment projects include the expansion of the mass transit network in Bangkok, water resource management, and an integrated logistics system. These public investments will ease bottlenecks and allow firms to focus on improving their efficiency and productivity. The importance of productivity cannot be overstated. But with integrated world financial markets, exporting firms must also learn to cope with exchange rate risk. We encourage exporters to hedge against foreign exchange rate risk, to bill their exports in foreign currencies other than the US dollar, and to use imports as a natural hedge. Your Excellencies, Ladies and gentlemen,  2  BIS Review 20/2007  The risk of global imbalances has been with us and will remain with us for some time to come. Each country has to do its own part in managing the risk. For us, we will forge ahead with our economic and political reforms. But major economies must also do their best to mitigate global imbalances since this is a global problem. We must solve it together. International policy dialogues such as the Fundinitiated Multilateral Consultation would need to be strengthened.

Being transparent also means that policy intents should be quantified, measured and disclosed. Finally, policymakers must not formulate public policy in isolation. We must promulgate policy with hard facts, backed by statistics and sound theoretical evidence. Foremost, we should not forget about the lives of people we are trying to help. A strong GDP growth figure will be less meaningful if they do not create good quality jobs, better distribution of incomes and higher standard of living for the people. Formulation of public policies must continue to be based on sound economics and have the ultimate goal of improving the welfare of society. While we remain cognisant of the broader distributional implications of our policies, issues that are more structural in nature such as low productivity, income inequality and quality jobs creation would also require specific policies that lie beyond the capacity of the central bank alone. It requires collaboration across many domains, with other policy makers, and with many stakeholders for the betterment of the standard of living and welfare of the general public. As we know it, the world is fast evolving and we must keep pace. The progress of information and communication technology, has been astounding and its assimilation into our economic and financial system structure will be the catalyst to propel finance as the great social equaliser. But for us to optimise the benefits for all, we need to strike the right balance between regulation and allowing technological innovations to take place in our financial system.
The Sellers Stamp Duty (SSD) holding period was shortened and the rates lowered because speculative flipping of properties had declined significantly. Mortgage equity withdrawal loans (MWLs) with LTV ratios of 50% or less were excluded from the TDSR framework to give home owners greater flexibility to monetise their properties for retirement needs. - This is for a very small category of people: we estimate that MWLs excluded from the TDSR framework made up just 1% of new private housing loans granted in the last three months. Over the medium-term, property prices should be aligned with broader income trends in the economy. Ultimately, residential property purchases are financed out of buyers’ income. In turn, income growth depends on GDP growth. If property prices increase faster than nominal GDP growth on a sustained basis, buyers would end up taking on more leverage than they can reasonably repay out of their incomes. Such highly-leveraged households will be particularly vulnerable when interest rates rise or their incomes fall. Therefore, market participants – owner-occupiers, investors, developers – need to set realistic expectations regarding future property price increases. MAS, together with MOF and MND, will continue to keep a close watch over developments in the property market. MAS’ FINANCIAL PERFORMANCE After contribution to the Consolidated Fund, MAS made a net profit of $ billion for FY2016/17. This is a record profit but as I have often reminded at these briefings, MAS’ profit and loss outcomes are subject to sharp swings.

It is important to intervene upstream in the process well before retrenchments take place. MAS  is working with financial institutions to identify early on jobs that might be at risk in the future. We then work with these financial institutions to proactively up-skill these workers through professional conversion programmes. These are all early efforts still and will take time to bear fruit. On the positive side of the jobs equation, we continue to see good demand for professionals in several areas of finance. These include compliance, risk management, insurance underwriting, and asset and wealth 9 / 10  BIS central bankers' speeches  management. Within the technology area, there continues to be strong demand for expertise in cyber security, data analytics, network architecture, artificial intelligence, and machine learning. MAS is working closely with the industry to build the relevant skills and competencies at all levels within our financial institutions. To ensure graduates are job-ready, we are partnering with institutes of higher learning to develop curriculum in new growth areas, for example risk analytics for insurance. To support mid-career finance professionals deepen their specialist skills so that they stay relevant, we have launched the SkillsFuture Study Awards, with a total of 170 awards to be granted this year. To equip capable Singaporeans to take on regional or global leadership roles in financial institutions, we are co-funding leadership programmes at NUS and SMU focusing on international exposure, Asian market insights, and professional networks.
I hope that sharing the Bank’s experience will reinforce the current initiatives you may have in your organisations and perhaps even trigger some new ideas about what more we all can do to achieve gender equality in the industry. Lessons from the Bank’s diversity and inclusion initiatives Diversity is not a one hit wonder: focus on the whole process from recruitment to development to promotion The Bank recognises that how it recruits affects whom it recruits. From school leavers to career returners, the Bank has programmes to attract diverse talent at each stage of life. To help develop the next generation, the Bank is working with schools to encourage a more diverse set of students to study economics and finance. We provide free classroom materials for students aged 11‐16 to equip them with the analytical skills to make informed financial decisions, using real‐world examples, captivating videos and accessible case studies.7 By the end of 2018 we had reached 90,000 students through our “EconoMe” programme, one quarter of all state secondary schools in the country. In an attempt to inspire children into finance, over the past year we have also made more than 300 school visits, of which 75 were by the Bank's policy committee members. 5  Farmer, H, McKay, R, Tsakiris, M, Trust in Me (2013): “Trust in Me: Trustworthy Others Are Seen as More Physically Similar to the Self”, Psychological Science. 6 Kahneman, D (2012) “Thinking Fast and Slow”, London. See also Sunstein, C.R, Hastie,R (2014), “Making Dumb Groups Smarter”, Harvard Business Review, December.

But the oil remaining under the North Sea lost even more of its value when oil prices fell from USD 150 to USD 40 in the course of a half year. On the other hand, oil prices may show a more favourable tendency than equity prices. The slide in equity prices over the past quarter has not been accompanied by weaker oil prices. Norges Bank has been delegated the responsibility for managing the Government Pension Fund Global and hence has an independent responsibility for limiting and managing risk. We  19  See national accounts data from Statistics Norway: http://www.ssb.no/histstat/aarbok/ht-0901-355.html and historical data on the Norges Bank website http://www.norges-bank.no/en/price-stability/historical-monetarystatistics/  20  See, for example, World Bank data on www.databank.worldbank.org  21  For the results of the Pisa survey, see: http://www.pisa.no/english/index.html  22  http://www.statsbudsjettet.no/Statsbudsjettet-2012/English/  6  BIS central bankers’ speeches  have therefore reduced the fund’s holdings of southern European government bonds in recent months. We have also reduced counterparty exposures to European banks. Maximising returns As a long-term investor, Norges Bank seeks not only to minimise the risk of losing wealth, but to maximise the return on the fund’s capital within the risk limits set by the fund’s owner. But how can we manage our wealth to promote capital growth? Many have probably wondered as does the poet Jan Erik Vold when he writes: “You put as the advert says 20 000 kroner into a high-interest savings account in one of our largest banks.
Left unchanged—without our tiering system—it would have severely impaired the bank channel in the transmission of our monetary policy. The return of policy rates to positive territory would this time provide a sizeable risk free income to the banking system, and a similar loss for the Eurosystem. The possible losses for central banks and the Eurosystem may draw public attention, but the primary objective of monetary policy is price stability, not central bank profitability; and the more relevant issue  Page 8 sur 8 in this regard, rather than our profit and loss statement, is the financial solidity of central banks’ balance sheets through their levels of capitalized reserves. The effect on banks’ net interest income nevertheless, if opposite in sign to the one under negative rates, could also distort the transmission of our monetary policy. Just as we did with the tiering scheme, we have to think about a reserve remuneration system adapted to this new context, as the ECB announced it in our July decisions. We will conduct this assessment in a swift and pragmatic way, looking at various options having existed across history and across jurisdictions. ** The high uncertainty in which we must at present navigate the normalization of monetary policy means that we will have to artfully deal with the unexpected. Perhaps however, accepting this uncertainty is, if not what science is typically associated with, at least what rationality commands. Voltaire said, “uncertainty is not a pleasant condition, but certainty is absurd”.

But at present, in a very uncertain situation, we all tend to move away from it, and even to distrust it because it would tie our hands. Does it mean that we also abandon predictability? I will here come to my second part, and focus the art/science nexus on the reactivity/predictability trade-off, if you allow me to assimilate the former to intuition and art, and the latter to rationality and science. II. Four possible lights for a new predictability Should art now play a bigger role? At a minimum we should acknowledge the need for modesty, agility and nimbleness. But this is not an argument for returning to the secrecy and unpredictability that characterized central banking until the 1990s. There is no room for what Karl Brunner ironically described forty years ago as “thriving on a pervasive impression that Central Banking is an esoteric art, [whose] esoteric nature is revealed by an inherent impossibility to articulate its insights in explicit and intelligible words and sentences.”vii Instead, we should aim to build a “new predictability”, a different one suited for uncertain times. Let me propose, with humility, four possible lights in approaching it. II.A.
These are likely to include the cash flow effects of interest rate changes on interest payments and receipts and the effects of asset prices on wealth portfolios. For example, when asked about whether lower interest rates have benefitted them, around a third of the UK public – and more than half of those aged over 50 – suggest not. 17  Within that group, a large majority –  around 80% – focus only on the negative effects of lower rates on their savings income. This is only one of the channels through which monetary policy works, albeit the most immediate and observable. It is far harder for the public to take account of the other channels, many of them neither immediate nor observable, through which a relaxation of monetary policy might benefit them. This includes the effects of looser policy in boosting wages and jobs. Not taking account of these channels can give a distorted lens on the impact of policy on the economy at large, on inequality and on individuals’ personal finances. To gauge fully the distributional impact of monetary policy, then, we need to capture as many as possible of its transmission channels, direct and indirect, immediate and slower-moving. It is only by considering all of these channels in combination that we can then properly evaluate the impact of monetary policy on the income, wealth and welfare of people and the distribution of these effects. It is to those we now turn.

4  Given the increased interest in distributional issues, and the increasingly activist role of monetary policy, it is perhaps no surprise that there has been increasing public interest in the fusion of the two – that is to say, the distributional impact of monetary policy itself, which is what I’m going to talk about today. Chart 1 shows a simple metric of that increased public interest since the financial crisis based on that most scientific of metrics, the Google search. Interest in these issues has sometimes spilt over into sharp criticism of central banks’ actions. Surveys of the general public have suggested that a large proportion may believe lower interest rates have actually 5  made them worse off. Meanwhile, QE is held by some to have increased inequalities between rich and poor 6  and to have harmed pension funds and the companies sponsoring them. Some have gone further, suggesting that QE may have caused central banks to cross the thin line between 7  monetary and fiscal policy, between economic policy and political economy. Others still have suggested that these unconventional monetary measures may have called into question central banks’ operational independence from government in the setting of monetary policy. 8  My aim in this lecture is not to resolve these questions, one way or the other. Rather, it is to provide a framework for assessing the first claim – that recent monetary policy actions have had a significant distributional impact.
But at the same time, the public finances problems in several European countries have led to a number of fiscal tightening packages, which will subdue domestic demand in the coming period. I shall return to this later. 2  BIS Review 109/2010  Since our Monetary Policy Report was published, Eurostat has reported a flash estimate for GDP growth in the euro area for the second quarter of this year. This showed an increase in GDP growth of 1.0 per cent, compared with the first quarter, which was much more than the 0.3 per cent we were expecting, and much stronger than during the first quarter. The average level of GDP growth in the euro area was high thanks to very high growth in Germany. Moreover, the purchasing managers’ index for the manufacturing industry in the euro area rose to 56.7 per cent in July. The economic recovery is also continuing in our Nordic neighbouring countries. Inflation in the euro area was 1.7 per cent in July, measured in terms of the EU-harmonised consumer price index, the HICP, which may be considered a relatively high inflation rate given the low resource utilisation in the EU. But if one disregards energy and unprocessed foods, inflation was only 1.0 per cent in July, which is largely the same inflation rate as earlier in the year. (Figure: Inflation in the euro area).

However, during the summer the countries affected have managed relatively well in issuing government bonds, and the banks’ interim reports have been positive. The European Central Bank has been able to reduce both its purchases of government bonds and its lending to the banks. The general picture is, to summarise, that the unease in the financial markets has been subdued during the summer, at the same time as the situation is still not normal. From this international perspective I shall now move on to a national one, and take a look at economic developments in Sweden. Economic developments in Sweden At the beginning of this presentation I summarised the picture of developments in Sweden painted in the Riksbank’s Monetary Policy Report. The Swedish economy is developing strongly following the severe downturn. GDP was expected to grow relatively quickly over the coming years, and the labour market was expected to improve. Inflationary pressures are currently low, but are expected to increase as resource utilisation rises. I will now describe developments in the Swedish economy in a little more detail, and at the same time discuss new information received during the summer. 1  Somewhat simplified, one can say that a CDS is a contract where the buyer pays the seller a premium for the seller to take on the credit risk linked to an underlying asset, such as a bond. The premium then becomes a measure of the credit risk.
A track record of low inflation over several years has provided Norges Bank with a  2  BIS Review 47/2001  better basis for implementing monetary policy. The new guidelines do not imply a significant change in the conduct of monetary policy. The key rate is set on the basis of an overall assessment of the inflation outlook. Higher interest rates curb demand for goods and services and reduce inflation. Lower interest rates stimulate economic growth. Lower interest rates have the opposite effects. If evidence suggests that inflation with unchanged interest rates will be higher than 2½ per cent, the interest rate will be increased. If it appears that inflation with unchanged interest rates will be lower than 2½ per cent, the interest rate will be reduced. There is symmetry here. It is equally important to avoid an inflation rate that is too low, as it is to avoid an inflation rate that is too high. A change in interest rates is not expected to have an immediate effect on inflation. Our analyses indicate that a substantial share of the effects of an interest rate change occurs within two years. Two years is thus a reasonable time horizon for achieving the inflation target of 2½ per cent. Hence, the key rate is set with a view to achieving an inflation rate of 2½ per cent two years ahead.

Norges Bank therefore attaches substantial importance to what seems to have become a fairly broad consensus on a long-term anchor for fiscal policy that takes into account possible fluctuations in oil prices from one year to the next. The rule would appear to be credible as well since it is robust in relation to various scenarios for oil prices and oil production. The Government was of the view that a clearer anchor was required to reinforce monetary policy’s role in underpinning stable economic developments. This is why Norges Bank was given a new operational mandate for monetary policy. Norges Bank shall set the key rate with a view to maintaining low and stable inflation. The inflation target is set at 2½ per cent. The new mandate for monetary policy is in line with international practice. Sweden and the UK have an inflation target. These countries generally have a positive track record, but this may also be ascribable to a situation that was conducive to low inflation after the downturn in many countries in the early 1990s. In our view, there has been a reasonable degree of confidence in monetary policy over the past decade. Inflation has been low and stable. By quantifying an inflation target, the Government may nevertheless have made it easier to understand Norwegian monetary policy. With the revision of monetary policy, the Government has also, in our view, recognised low inflation as a benefit in itself.
On the contrary, I think that appropriate fiscal retrenchment in countries that need it is part of growth enhancement, because sustainable public finances makes a difference in terms of improving confidence of households, enterprises, investors and savers, which is decisive to foster growth and job creation. WSJ: Does the U.S. have it wrong? It is engaging in even more fiscal stimulus. TRICHET: It’s not for me to give a lecture to other advanced economies. We have our own responsibilities. In our own case we strongly believe that fiscal soundness is confidenceenhancing and therefore part of a growth-enhancing strategy. WSJ: In your recent ECB press conference you made repeated references to the July 2008 rate hike and said the ECB is never pre-committed not to move interest rates. Were your remarks over-interpreted as hawkish? TRICHET: I have nothing to add to what I have said last Thursday (ECB press conference on 13 January). You have to place my remarks in the context of the first 12 years of the euro, during which we delivered price stability in line with our definition: less than 2%, close to 2%. When you look at the yearly average since the setting up of the euro it is 1.97%, better than had been done in any such period of time in the previous 50 years. You don’t get this result by chance. We are profoundly attached to our mandate.

To determine the impact of the illiquidity premium and inflation risk premium on these results, we decomposed our ex-ante analysis, comparing the breakeven rate of inflation excluding the illiquidity premium in TIPS yields 3 to the SPF forecast. This comparison yields an  2  In addition to these primary factors, TIPS yields also reflect the taxation difference between TIPS and nominal issues, the convexity difference between real and nominal yields and the price of the embedded deflation floor. 3  We used the illiquidity premium in TIPS yields estimated in D’Amico, Kim and Wei (2008). D’Amico, Kim and Wei calculated the liquidity component for five- and ten-year TIPS yields, which we used to adjust the auction prices for 5- and 10-year TIPS issues. For twenty- and thirty-year TIPS issues, we assumed that the liquidity component is equal to the component for a ten-year security, which in the event that these securities are less liquid than the ten-year note, understates this effect and thus underestimates the risk premium at this horizon. For further information, see Dudley, Roush and Steinberg Ezer (2008). BIS Review 14/2009  3  estimate of the premium investors were willing to pay for inflation protection at previous TIPS auctions. We found an average risk premium estimate of 47 basis points over our sample period. This suggests that the TIPS program does satisfy a real demand that is not met by nominal Treasuries.