samchain/econo-pairs-v1 huggingface dataset:
But a strong independence and plenty of room for manoeuvre entails freedom with responsibility – we have an important analytical and educational task to explain what we do and how this helps us attain our objectives. I want to start by going back in time around 350 years. The motive for our independence – creating long-term stability Every central bank reflects its time and its country, but some tasks are common to all of them through history, for instance, issuing means of payment in the domestic currency, and ensuring the means of payment can be used and retain its value. And this also applies to the world’s oldest central bank – the Riksbank. Monetary policy has always focused on maintaining the value of money. Historically, the Riksbank has tried to do so by having a nominal anchor. 2 The establishment of the Riksbank can be dated back to Stockholm banco, Sweden's first bank. This also became Europe’s first banknote-issuing bank. The value of the banknotes was based on it being possible to exchange them for coins. But when an abundance of banknotes were issued, the general public began to question their value and demanded to redeem them. The nominal anchor gave way. And a bank crash was unavoidable. Riksens ständers bank emerged from the ashes of this in 1668, becoming what we know now as the Riksbank, as an authority under the Riksdag, the Swedish parliament.

Narrow or broad mandate for central banks? Political influence  Political independence Narrow target definition, few tools  Broad target definition, many tools  17 [20]  Figure 7. Yield spread between different types of bond and government bonds in Sweden Percentage points 2,5  2,5  Municipal bond, 5 year Corporate bond, 5 year Covered bond, 5 year  2,0  2,0  1,5  1,5  1,0  1,0  0,5  0,5  0,0 Jan-19  Jul-19  Jan-20  Jul-20  0,0  Jan-21  Note. Percentage points. Yields on covered bonds, corporate bonds and government bonds are zero coupon rates calculated using the Nelson-Siegel method. Corporate bonds refer to companies with a high credit rating. Municipal bonds are issued by Kommuninvest i Sverige AB. Broken line marks 11 March 2020, same day the WHO declared COVID-19 to be a pandemic. Sources: Bloomberg, Macrobond, Refinitiv and the Riksbank. Figure 8. Borrowing among non-financial corporates Percentage of GDP, quarterly data 80  80  60  60  40  40  20  20  0  0  95  00  05  10  Lending from MFI  15  20  Issued securities  Note. Includes securities borrowing in both Swedish kronor and foreign currency. Sources: Statistics Sweden and the Riksbank  18 [20]  Figure 9.
Chart 2: National Bureau of Statistics, China Chart 3: Associação Nacional dos Fabricantes de Veículos Automotores, Brazil Chart 4: Ministry of Economy, Trade and Industry, Japan Chart 5: Bundesbank, Germany Chart 6: Bureau of Labor Statistics, US Chart 7: ONS Chart 8: Baltic Exchange Chart 9: Consensus Economics and Bank calculations  BIS Review 8/2009  1  Governments and central banks around the world responded decisively and boldly with large fiscal injections and cuts in interest rates, and the provision of hundreds of billions of pounds in capital and funding to support banks. The scale and urgency of their actions embodied an audacity born out of pessimism. Tonight I want to ask: what went wrong? How can we limit the impact of the banking crisis on the wider economy? And can we design a better approach to the management of our economy and financial system in the future? So what went wrong? The origins of the crisis lie in the imbalances in the world economy which built up over a decade or more. The entry of the rapidly growing economies in Asia into the world trading and financial systems provided a huge new pool of savings. But their development and exchange rate strategies meant that they were running large current account surpluses. In other words, their domestic saving was more than enough to finance investment at home. Significant amounts were channelled into foreign financial assets.

Such asset purchases involve taking more credit risk onto the public sector balance sheet. That is why the Bank will consider purchasing only high quality assets. Despite the existence of a range of unconventional instruments, monetary policy is likely to be more effective when the banking system is working normally. So the first priority for policy is to fix the banking system so that it can resume its normal lending function. The contraction of lending to ordinary viable businesses – your businesses – is threatening to drive the economy further into recession. The package of measures announced yesterday by the Chancellor are not designed to protect the banks as such. They are designed to protect the economy from the banks. In particular, the Asset Protection Scheme aims to remove a degree of uncertainty about the future losses banks will make. It also has the effect of reducing the amount of capital banks need to hold against their risky assets. Both effects will serve to strengthen and underpin banks' balance sheets and so support their lending to the real economy. To be clear, the scheme does not mean that the taxpayer will bear the full brunt of past lending mistakes by banks. Rather, there is sharing of losses between shareholders and the government – or coinsurance – with the government providing, at a price, insurance against only extreme outcomes for the banks.
Mr. Heikensten talks about monetary policy and the Swedish economy Speech by the Deputy Governor of the Bank of Sweden, Mr. Lars Heikensten, on the occasion of the 1997 Money and Capital Markets Day arranged by The Association of Local Authorities and the Federation of County Councils on 13/3/97. Today I shall be considering this field in terms of three topical issues: - First there is the path of inflation in recent years. In this context I shall dwell on the significance of transitory effects, not just for recent price tendencies but also more in principle. - Next comes the issue of employment. What can monetary policy do to help create new jobs in Sweden? - The third matter is the rule system for monetary policy. What is the point of delegating the management of monetary policy and the task of establishing low inflation to a central bank? In this connection I will also look at various proposals that are being discussed at present for amending the rules for the Riksbank. Inflation and monetary policy Price stability is the Riksbank’s paramount objective, specified in the target of keeping the increase in the consumer price index to 2 per cent, with a tolerance interval of ±1 percentage point. There is a time lag of one to two years before a monetary policy measure has its full effect on inflation. Our discussion should therefore focus on future inflation. But first I want to say something about inflation in the past year.

This may seem paradoxical but if people feel they can rely on the central bank, in an economic slowdown it may be possible to ease the monetary stance without triggering higher inflation expectations and bond rates, because everyone counts on policy being tightened before inflation moves up. We have experienced something of this sort in Sweden in the past year. In a system with poor credibility, a monetary easing may be perceived as a sign of a lasting upward shift in inflation. This in turn may generate self-fulfilling expectations, with future problems when efforts are made to control inflation once more. It is understandable that the risk of this is seen as particularly great in economies where inflation has been high for a long time. A more independent central bank is thus in a better position not only to maintain low inflation but also to operate at times with a policy that includes an element of stabilisation (though the problems of fine tuning stabilisation policy should not be underestimated). The German central bank is one example; over a series of decades, economic slowdowns could be parried by lowering the short interest rate fairly rapidly and markedly. It may be in place to point out that credibility and, for that matter, independence can be achieved in various ways. Some countries have recently clarified their regulations so as to BIS Review 32/1997  -7-  bring them into line with the arrangement I have just advocated. One example is New Zealand.
Personal Contract Purchase (PCP) plans accounted for one in five new car purchases in 2006. Now they finance almost four in five (Chart 13). At the aggregate level, PCP is the new cash purchase. The Financial Conduct Authority, which regulates car finance, has expressed its concerns about a lack of transparency, potential conflicts of interest and irresponsible lending in parts of the car finance industry. It will explore and address those practices. 9  The Bank of England’s role is to manage any risks to the wider economy from this growth. And those should be kept in perspective. On average, those taking out PCP plans tend to have higher incomes and more savings than the population as a whole. 70% of PCP borrowers have above average income (Chart 14). Arrears rates on banks’ car finance deals are lower than on other forms of consumer credit. Moreover, the true burden of car finance to households overall is much lower than it seems at first glance. 9  Financial Conduct Authority (2017) ‘Business Plan 2017/18’. https://www.fca.org.uk/publication/business-plans/business-plan-201718.pdf 10  All speeches are available online at www.bankofengland.co.uk/speeches  10  PCP plans commit the car buyer to around three years of fixed monthly payments with an option - not an obligation - to make a final balloon payment at the end of that period, to own the car outright (Chart 15). If those optional balloon payments are excluded, this car finance debt accounts for only 1.2% of aggregate household income.

Aggregate cumulative UK impairment charges over the five years of the (a) stress Impairments in the stress (left-hand scale) Impairment rates in the stress (right-hand scale) Per cent 25  £ billions 20  20  15  15 10 10 5  5  0  0 UK mortgages  Sources: PRA regulatory returns, published accounts and Bank calculations. (a) Major UK banks’ core Tier 1 capital as a percentage of their risk-weighted assets. Major UK banks are Banco Santander, Bank of Ireland, Barclays, Co-operative Banking Group, HSBC, Lloyds Banking Group, National Australia Bank, Nationwide, RBS and Virgin Money. Data exclude Northern Rock/Virgin Money from 2008. (b) Between 2008 and 2011, the chart shows core Tier 1 ratios as published by banks, excluding hybrid capital instruments and making deductions from capital based on FSA definitions. Prior to 2008 that measure was not typically disclosed; the chart shows Bank calculations approximating it as previously published in the Report. (c) Weighted by risk-weighted assets. (d) From 2012, the ‘Basel III common equity Tier 1 capital ratio’ is calculated as common equity Tier 1 capital over riskweighted assets, according to the CRD IV definition as implemented in the United Kingdom. The Basel III peer group includes Barclays, Co-operative Banking Group, HSBC, Lloyds Banking Group, Nationwide, RBS and Santander UK. (e) CET1 ratio less the aggregate percentage point fall projected under the Bank of England’s 2016 annual cyclical stress scenario for the six largest UK banks.
The sharp increase in the value of dwellings is one of the main factors behind growth in household debt. House prices have risen by an annual average of around 9 per cent over the past 10 years. High and persistent house price inflation might contribute to holding up credit growth even after prices have levelled off. Since only a portion of the housing stock is sold each year, there will for a long period be some dwellings that are sold at a higher price than when they were last sold. This contributes to sustaining high credit growth. As a result of low interest rates, the household interest burden will remain fairly low in spite of high debt growth. It may prove to be particularly challenging for borrowers to assess their debt-servicing capacity over time in a period when the interest rate is abnormally low. Such a low interest rate also places greater demands on banks in assessing the creditworthiness of borrowers. According to money market expectations, the interest rate will eventually stabilise around 5½ per cent. This is consistent with an inflation target of 2½ per cent and a long-term real interest rate on a par with the level abroad. This interest rate, with an addition for banks’ margins, provides a more realistic indication of the interest rate level that will apply over the loan’s life than the floating interest rates prevailing today. The interest rate can be used to reduce credit demand.

BIS Review 18/2005  1  This brings me to a third factor that has contributed to the low inflation, namely productivity, which grew stronger than expected by the Riksbank and other forecasters. (Figure 2). This is the other side of the unexpectedly weak labour market conditions, which in turn have dampened domestic price and wage pressures. Neither are the causes of the high productivity growth fully understood. One possible hypothesis is that the large-scale IT investment in many sectors at the end of the 1990s is now beginning to pay off. Another theory argues that Sweden is a highly open economy and thus strongly influenced by the currently rapid integration of low-cost countries into world trade. As regards the developments in both productivity and imported inflation there is considerable uncertainty over the strength and durability of the present tendencies. The Riksbank and unemployment As I said earlier it is natural that a debate on monetary policy should arise when inflation deviates considerably from target. On this occasion the debate has been fuelled further by the rise in unemployment in 2003-2004. When I was here in the autumn I devoted a lot of attention to the issue of what the Riksbank could do about the unemployment situation. The discussion has continued since then. It is important to remember that the Riksbank’s objective is price stability.
BIS central bankers’ speeches  3  which maintains the size of the portfolio and adjusts the asset type and maturity composition of its holdings. 8 Large-scale asset purchases as a policy tool and their execution Of course, as this audience knows well, the Federal Reserve was not the first major central bank to use alternative tools for monetary policy implementation at the zero lower bound. The quantitative easing policy (QEP) that the Bank of Japan (BoJ) initiated to combat deflation in 2001, after operating for some time under a policy of zero interest rates, provided a valuable precedent when central bankers elsewhere faced similar challenges later that decade. However, the balance sheet expansion under the BoJ’s original quantitative easing differed significantly from the asset purchase programs undertaken by advanced economy central banks over recent years, including the BoJ’s current quantitative and qualitative monetary easing (QQE). The earlier QEP was a liability-driven program in which the BoJ changed its operating objective from an overnight interest rate to quantitative targets for the level of current account balances outstanding at the BoJ (the counterpart to reserve balances held by depository institutions at the Fed). To achieve its new target, the BoJ provided ample liquidity through a range of operations. Although the BoJ increased its outright purchases of long-term government bonds as part of this initiative, a large share of the easing was accomplished through temporary open market operations or purchases of short-term securities.

Thus, the human and societal cost is very real. It is pervasive and destructive, rippling across society, and if left unattended, will accumulate over time. Imagine the thousands of schools that could have been built, numerous hospitals with the best care and the strongest social safety nets that can help those most in need. The persistence of financial crimes will disproportionately impact the most vulnerable section of society. It erodes trust and leads to a breakdown in society. We in the financial sector have an instrumental role to play in this area. Our job involves the intermediation of money flows. We have the ability to prevent and facilitate investigations and prosecution of these crimes. In light of this, allow me to make three points on how we can achieve greater governance and transparency in the financial sector, which will reshape Malaysia’s future for the better. Shared responsibility to enhance compliance and prevention The first point that I would like to make is that combating financial crime is a shared responsibility. It is not the sole responsibility of central bank supervisors, financial intelligent units, banks or even the compliance function within financial institutions. Just as individuals, all of us have a collective responsibility to contribute to nation building, it is the responsibility of each player in the financial system, law enforcement agencies, prosecution agencies and the judiciary to look out for potential abuses, stamp out financial crimes and not let the perpetrators get away. For financial crimes do not occur in isolation.
The vigorous productivity growth has been another positive surprise in the performance (Figure 5). At the start of the 1990s there were no indications that this would be the case. Why then would the Government have appointed a productivity delegation? The firm productivity gains have, of course, been crucial for the increases in real wages. But they also have meant that companies have not needed to hire new staff on the same scale as before, which has contributed to the weak employment growth in recent years. We really do not know why productivity has improved so strongly even if there are a number of hypotheses according to which the IT explosion, deregulation and increased global competition are significant explanations. For the Riksbank, it is important to understand this better if we are to be able to produce accurate forecasts of inflation. Of even greater importance, of course, is to do what is possible through economic policy to ensure that the positive performance can continue. In the long run higher real wages presuppose increased productivity. Two problem areas However, not everything has been as positive. Labour supply has not developed as well as one might have hoped. There are currently large groups outside of the labour market and employment has increased at a slower rate than is desirable over the past ten years.

i  Lagarde, C., Challenges along Europe’s road, speech, 11 May 2022 Villeroy de Galhau, F., The Eurosystem and its monetary policy: from an “impossible dilemma” to a possible roadmap for normalisation, speech, 6 May 2022 iii QJE paper by Fahri and Maggiori (2018) iv See the Council conclusions on achieving the EU’s economic and financial strategic autonomy in an open economy: one year after the Commission’s Communication. v Villeroy de Galhau, F., Capital Markets Union: unleashing Europe’s potential, speech, 30 November 2021 vi ECB report on RIE : only 60% of extra-euro area exports of goods were invoiced in euro in 2020 vii Recent research by Amiti, Itskhoki and Konings (2020) viii See the document Trade and investments in energy in the context of the EU common commercial policy ix Quote available here https://www.imf.org/external/np/exr/center/mm/eng/mm_sc_03.htm ii
The single most influential act for banks was the introduction of the Second Banking Coordination Directive, which provided a passport for banks to offer services across the European Union. Liberalisation in the EU financial services sector is already very extensive. What we see now is an ongoing adjustment of the regulatory environment implemented in the 1980s and early 1990s. In effect, it allows other driving forces to have a more profound effect on the financial system. One of these factors, which has been facilitated by liberalisation, is the trend towards globalisation. This trend is occurring in most private sectors of the economy. As companies and individuals requiring financial services are becoming more globally oriented, they demand appropriate financial services. Globalisation is expected to increase competition in most areas of financial services, and it may also be able to realise economies of scale and scope. At the same time, globalisation has opened up new markets for banks, particularly in trading, asset management and investment banking activities. Finally, the wealth of individuals has increased, and a larger proportion of the population is making portfolio investments. This is partly a result of the ageing of the population, which has, in itself, increased the average wealth of people. At the same time, it is also due to changes in pension systems in a number of countries from a “pay-as-you-go” to a funded basis. The prospects for the future are for more of such change, as reflected by the recent proposals for pension reforms in Germany and France.

Christian Noyer: The euro and the banking sector  Speech by Mr Christian Noyer, Vice-President of the European Central Bank, at the Duisburger Banking Symposium, organised by the European Center for Financial Services, on 27 September 2000. *  *  *  Ladies and gentlemen, It is a pleasure for me to speak here at the Duisburger Banking Symposium. The famous American comedian, Bob Hope, once typified a bank as “a place that will lend you money if you can prove that you don’t need it”. As we all know, this description does not give credit to the extremely important role that banks play in a modern economy. Nowadays, economic life simply would not be possible without the wide range of services and products that banks offer to various groups of society. The issue that I shall address today - the euro and the banking sector - cannot be fully comprehended without considering the particular, and to a large extent unprecedented, nature of the introduction of the euro. The single currency does away once and for all with internal exchange rate fluctuations, completes the structure of the Single Market and, by virtue of its availability to almost 300 million people, increases the efficiency of currency use in an unprecedented manner. The introduction of the euro was a regime shift that will undoubtedly have a major impact on the euro area economy and its financial structure in the years to come.