samchain/econo-pairs-v1 huggingface dataset:
Swedbank has released detailed data to explain why they are closing branches, and they show that the branches being closed were used by only 13% of the clients registered there prior to closure, and that the number of cash transactions in those branches has halved in five years. The larger commercial banks in Estonia now provide services more efficiently, and one consequence has been the closure of branches and cash machines in rural areas. A comparison with Sweden can be useful here, as that is where the parent banks of our largest banks are based. At the end of 2013 there were 1655 bank branches in Sweden, and a little over half of them were cash-free, which is more than twice the proportion in Estonia, where only 23% are cash-free. 2  BIS central bankers’ speeches  At the start of June I wrote to the leaders of the local government in Läänemaa that Eesti Pank finds that having a single network of cash machines for all the banks would not improve access to banking services in rural areas. This is because it would not be possible for any commercial bank to differentiate its services from those of other banks by offering higher quality if there were a single network. Furthermore, a single network dilutes the responsibility of each individual bank, making it harder for clients or the public to affect the decisions taken by the banks.

But they did not portend a permanent ratcheting up of inflation. Core PCE inflation – which excludes the volatile food and energy components and is a better predictor of future overall inflation – has been just 1.7 percent over the past year. Furthermore, prices for energy and many other commodities have softened of late. And with the unemployment rate still high and capacity utilization low, resource slack continues to exert downward pressure on prices. In addition, measures of longer-run inflation expectations are at the low end of the range they have been running since last November. Putting these factors together, I would argue that inflation is likely to remain moderate over the foreseeable future. The FOMC forecasts for core inflation were concentrated near 1.8 percent this year, and its forecasts for total inflation were in the range of 1.5 percent to 2.0 percent for 2012, 2013 and 2014. My own assessment is that inflation will be at the lower end of these ranges. Fed performance These disappointing forecasts pose a challenge for monetary policy. The Fed is charged by Congress in the Federal Reserve Act to encourage conditions that foster both maximum employment and price stability. This is what you hear us refer to as the Fed’s “dual mandate”. Given the high unemployment rate and low job growth, I think it is clear that the Fed has fallen short in achieving its goal of maximum employment. I will return to this point shortly.
At the same time, the scope for budget policy will be curtailed in a sense by the Stability and Growth Pact, though this need not be so much of a restriction in practice as long as the objective of medium-term balance or surplus is met. A stronger challenge is to be expected from the ongoing integration in the European Union, which BIS Review 50/1998  -5-  EMU may accentuate. This process can be rather rapid, not least in financial markets. In markets for goods, pricing in a single currency may accelerate the existing trend towards smaller differences in consumption taxes, for example. Structural and labour-market policy Finally some words about structural and labour-market policy. This policy field is much less clearly defined than the two I have already considered. It is affected by many different rule systems at both national and EU levels, besides belonging to the competence of many different ministers and commissioners. The common agricultural policy and tax harmonisation are two examples. The components of structural policy that concern the internal market - competition laws, the whole of the market for goods and services, the mobility of capital, and labour market mobility - are largely regulated at EU level. The competition laws are one example here. Another component of structural policy is the regulations and other matters that apply to the labour market. Many initiatives here have recently been taken at EU level in order to speed things up and comply with political requirements in the Union.

This is important because the chances of the monetary union functioning properly are better if rates of inflation are much the same initially and government finances are under control. Besides the matters behind the Maastricht criteria, with monetary union imminent there are somewhat different issues that need to be considered. Even when the Treaty was being drafted, many economists pointed out that the criteria by no means constituted the only, perhaps not even the most important, requirements for an efficient monetary union. There are now two other matters that seem to be particularly important and they will no doubt receive more attention, both in the European economic debate and in the EU decision-making processes in economic policy: •  One has to do with the degree of uniformity in cyclical activity and the possibility of using judicious fiscal stances in different parts of the monetary union to make up for the absence of national discretion in monetary policy. •  The other concerns the participant countries’ economic structures, not least how their labour markets function and to what extent they are sufficiently flexible both to cope with any shocks to stability and to bring unemployment down to more acceptable levels. If the various political systems fail to prevent large imbalances in government finances, internally as well as between countries in the monetary union, then the ECB will be under strong pressure to consider other objectives than average European inflation. The same applies if unemployment were to remain high or become even higher.
To achieve this, systemic risks need to be more clearly identified and kept in check by means of better regulation. This involves, among other measures, the introduction of additional systemic capital and liquidity requirements, countercyclical buffers and provisions regarding risk concentrations in interbank positions. The financial markets, for their part, need more standardisation and greater transparency. It is important, for example, that products are increasingly traded and settled through stock exchanges. Moreover, a market economy can only function efficiently if companies – including banks – can be allowed to fail and disappear from the market as a consequence of poor decision-making. The aim of such reforms is not to prevent banks from taking risks, but to ensure that, in future, the banks themselves fully bear the risks they take. BIS Review 51/2010  1

Note: Coefficients are recalculated into percentages as per Palmquist (1980) due to log-linear specification. A negative pay gap in this chart indicates that women earn less than men. Chart 22: Conditional gender wage gap under specification (5) Difference in lnpay  0.05 0 ‐0.05  Gender pay gap  ‐0.1 ‐0.15 ‐0.2 ‐0.25 ‐0.3  1994‐1998  1999‐2003  2004‐2008  2009‐2013  2014‐2019  Source: ONS Labour Force Survey and Bank of England calculations. Note: A negative gender pay gap in this chart indicates that women earn less than men. 11 The regressions assume the effect of the controls on pay is homogenous between different groups. If we run a Chow test on this restriction, it fails in our sample. This would be a useful area for future research. 12 Coefficients are recalculated into percentages as per Palmquist (1980) due to log-linear specification. 27  All speeches are available online at www.bankofengland.co.uk/speeches  27  We can replicate this regression for ethnicity with the same set of controls, except that the occupation, age groups, and children under 2 variables now interact with the ethnic minority variable. Where  (6) ln  ∝  h  =  ∗ 1 0  h  ∗  person does not belong to white ethnic group person belongs to white ethnic group  With this specification, the conditional gap for ethnic minorities averages around -11% and is again significant at the 1% level.
The weak euro affects us at the macroeconomic level in two ways: it has a dampening effect on our price level; and it reduces net external demand on our economy. To offset these influences - to prevent overall demand growth falling short of underlying capacity growth, causing inflation to fall significantly below our 2½% target - and I remind you it is a symmetrical target - we have had to keep interest rates lower than would otherwise have been necessary, in effect encouraging stronger domestic demand growth, to keep the economy as a whole on track. The risk in this approach, of course, is that we could find it difficult to moderate the pace of domestic demand growth to a sustainable rate as and when the euro recovers. But that’s a bridge we will need to cross when we get there. Now some of you involved in those sectors that are suffering most from the weakness of the euro would - from your own perspective - like us to go further and try more actively to drive the exchange rate down. As I say, if I were in your shoes, I’d be tempted to argue that myself. Euphemistically it is suggested that we should “pay more attention to the exchange rate” - than, as I’ve explained, we do already.

However, the balance that we seek is between simplicity and risk sensitivity: indeed, the banking industry has been quite clear in saying that we should not blindly pursue simple solutions if they would result in unnecessarily conservative estimates of capital requirements. Achieving a balance between simplicity and risk sensitivity is particularly difficult in an industry like banking, where a culture of constant innovation makes it a tall order for regulators to develop simple rules that fit all banking products and services in all their permutations. Paraphrasing Einstein, we might say that a good capital framework should be as simple as possible, but not simpler. So while Basel II is admittedly a more complicated document than the 1988 Accord, I would suggest that much of its apparent complexity stems from the diversity existing in real world. The text provides multiple options in part because some banks and supervisors thought that a “blanket rule” would unfairly burden them. By providing a range of options, we are better able to fit the regulatory framework to each bank’s risk profile, rather than the other way around. Similarly, some of the complexity in Basel II stems from the details we provide to promote a more level playing field. Many bankers and supervisors asked the Committee to provide greater details where they thought a danger existed for differences in interpretation to arise across jurisdictions.
There are also particular reasons why, in this case, levels of debt may have been poor indicators of cross-country risk. In the United States, for example, many mortgages were “non-recourse” – it was lenders, not borrowers, who were liable for any negative equity in the event of default. This increased both the borrower’s incentive to walk away from the loan and the  1  British banks certainly lost much less on domestic mortgage lending during the last financial crisis than they had in the early 1990s – when, as it happens, the level of debt was lower than in 2007. Most losses during the financial crisis were on banks’ overseas assets. 2  All speeches are available online at www.bankofengland.co.uk/speeches  2  lender’s subsequent loss. All else equal, this would mean the same level of debt was riskier in the US than in the other two countries. Thanks to the tax regime the opposite was true in the Netherlands. Mortgage interest was fully deductible from taxable income and interest receipts were only lightly taxed. This encouraged so-called “round-tripping”. By ramping up both sides of their financial balance sheet – funding extra deposits with higher mortgage debt – the more highly taxed households could reduce their overall tax bill without adding to financial risk, either individually or collectively. Yet it turns out that the superior predictive power of growth rates of debt, over levels, is a more general phenomenon.

6  BIS Review 31/2008  Chart 1: Current account balances in the first wave of financial globalisation  Chart 2: Number of sovereign wealth funds since the 1950s  Per cent of own GDP United Kingdom Germany 15 Western Europe France 10  Number of SWFs 30 25  5 0  20  -5 15  -10 -15  10  -20 Canada Australia Argentina  -25 'New World' countries  5  -30 -35  1870  1877  1884  1891  1898  1905  1912  Source: Taylor, A (2002), “A century of current account dynamics”, Journal of International Money and Finance, pp 725-748. 0 1950s 1960s  1970s 1980s  1990s 2000s  Source: Morgan Stanley, Deutsche Bank  Global map 1: Current account positions (% of own GDP) in 1997  Source: IMF, World Economic Outlook, 2007  BIS Review 31/2008  7  Global map 2: Current account positions (% of own GDP) in 2007  Source: IMF, World Economic Outlook, 2007  Chart 3: Global holdings of fx reserves (excluding gold), 1995-2007 $  China Japan Russia Other Asia (a) Other EMEs Developed countries (b)  7 6 5 4 3 2 1 0  1995  1997  1999  2001  2003  2005  2007  Source: International Financial Statistics. (a) Excluding China and Japan. (b) Excluding Japan.
Then I shall look in a more principled way at what the new economy may imply for monetary policy. In this context I shall mainly consider the consequences in terms of higher productivity growth, but I shall also be touching on the new economy’s impact on demand, which has attracted less attention in the public debate. This will be followed by a look at Sweden and the conditions for a new economy and the inflation process. What is the situation here as regards, for example, the use of IT and competition? Has the new economy led to changes in the inflation process? Finally, I shall be saying something about what the Riksbank has to consider in the context of the new economy’s existence or non-existence. My review today obviously will not result in definite answers either way. The questions are too complex for that. Economists are finding it difficult in general to arrive at sound explanations for technical development and growth. The discussion about the new economy is therefore welcome on that account. It can inspire studies of the driving forces behind the technical progress we are aware is so important for our prosperity but about which we unfortunately do not know enough. 1. Starting point: experience in the United States  The American discussion about the new economy was instigated by a generally good economic performance that combined high growth and employment with low inflation. A variety of factors contributed to this achievement.

First, I would like to emphasise the importance of using the national currency against foreign currencies. Lek plays a crucial and direct role in transmitting the positive effects of monetary policy to our economy. The higher the use of Lek, the bigger is the part of economy which feels the effects of the central bank’s policies. Furthermore, the use of the national currency helps to amortise the shocks that steam from external sector through minimising the shocks on income, consumption and investments. The broad use of foreign currencies alongside the national one has important negative impacts, on both the effectiveness of economic policies and financial stability. Particularly, in this period, while global developments, ambiguity and the change in monetary policy stance may give rise to additional risks to the exchange rate. These risks destabilise and expose the balance sheets of private sector against the fluctuations of the exchange rate. In simple words, the less you use the foreign currency; the lower is the exposure to the exchange rate risk, which nowadays is even higher. The stability of financial institutions, enterprises and households contributes in the monetary policy pass through and macroeconomic stability. Second, I would like to re-emphasise the importance of growing and promoting financial literacy as a counter-response to informality. This objective belongs to the central banks, and to all economic agents, educational institutions and media, to enhancing financial awareness and ability of public. These joint efforts, in addition to strengthening the monetary policy effectiveness, directly affect the financial inclusions of population.
Through it, among other things, we not only influence on the economic agents’ expectations and behavior, but ensure our transparency, as well, which is especially important because the central bank is an independent institution, and independence goes hand in hand with accountability. After all, transparency and accountability are the fundamental principles underlying our operations – they guarantee the preservation of the confidence and integrity of the National Bank. Moreover, the public confidence in us and in our capacity to deliver macroeconomic and financial stability is a sine qua non to our success. The communication of central banks is a dynamic category. Several decades ago, globally, central banks were closed institutions whose communication was extremely complex – clear and close only to certain groups that knew central banking well. As FED’s former Chairman Alan, Greenspan’s once said: “If I’ve made myself too clear, you must have misunderstood me”. But today, we, the central banks, operate in a world of openness and clarity and tend to be understandable in our public speaking. Particularly significant changes in communication have been evident in the last ten years since the beginning of the global economic and financial crisis. And not just through greater openness in communication, but also in the way central banks present themselves in their releases. This is not surprising, since we all, during the crisis, faced with high uncertainty, mistrust, and we started using instruments outside the conventional set of instruments. With regard to these changes, I would particularly emphasize the ECB’s example.

We, as a central bank, are also active data user, simultaneously producing and disseminating large portfolio of statistical data, which is why we have huge responsibility. First, to provide timely, quality and comprehensive data consistent with the highest international standards. The membership in SDDS plus standard – the IMF’s highest standard since the beginning of this year – is a proof for these commitments; Second, to put all available data into active use in our analytical work, in order to make appropriate decisions on the basis of data and information; Third, to provide a transparent, regular presentation of our statistical portfolio to the public. As a central bank, we understand very well the need for our statistics to be communicated to the public as clearly and frequently as possible. Although statistics is everywhere around us, the statistics itself consist exclusively of numbers. “And they are not enough to tell the story – in order to mean something, we must revive their intrinsic value.” That’s why we, over the last few years, have been making great efforts to bring the statistics closer to you and to the public through direct communication. We started to publish regular statistical press releases, trying to explain what the latest statistics on the economy show. We are trying to standardize these press releases so they can be easily followed by the public.
Based on a survey that was conducted, consumer satisfaction towards financial services increased significantly from 61% in 2011 to 73% in 2015. We will continue to invest efforts towards improving the performances in this area. With loans amounting to RM1.5 trillion as at end-November 2016, the banking industry is the main source of funds to households and businesses, including small and medium enterprises (SMEs). Recognising the pivotal role of the banking sector in our economy, Bank Negara Malaysia will continue to develop the financial sector in a progressive and inclusive manner to ensure that all segments of society can benefit from this financing ecosystem. Financial knowledge among businesses and individuals must be continuously improved While results are promising, our efforts in achieving financial inclusion need to be further intensified. There remain gaps in access to financing for certain segments of society, which require collective efforts from all. The Bank is receptive towards these needs and remain committed to assist the public at all times. Among the issues raised by businesses are the difficulties in obtaining funding to start a business, particularly for SMEs and new companies. The factors cited for this include the absence of collateral, or insufficient track record, especially for businesses involved in new growth areas.

Muhammad bin Ibrahim: Raising awareness of financial knowledge in Malaysia Welcoming remarks by Mr Muhammad bin Ibrahim, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at Karnival Kewangan 2017, Kuala Lumpur, 13 January 2017. * * * It is my honour to be here this morning for the Opening Ceremony of the inaugural Finance Carnival. The carnival is an initiative formed through the collaboration of various ministries, agencies and financial institutions. It aspires to raise the level of public awareness in three important areas: financial services; knowledge of financial management; and consumer protection. I would like to extend my appreciation to Yang Berhormat Datuk Johari bin Abdul Ghani, Second Finance Minister, who has graciously agreed to join us today in officiating the Carnival. Finance has the power to transform lives The pursuit of financial knowledge is a key economic imperative. It also has the ability to transform lives. In today’s world, the ability and knowledge to save, invest and borrow are essential life skills, be it for individuals or businesses. For businesses, including small enterprises, financial knowledge is particularly important in generating income and to secure financing. Various efforts have been undertaken to improve financial inclusion in Malaysia. The results so far are promising. Currently, the majority of Malaysians (over 90 percent) have access to formal financial services. 92% of adults have a savings account, while 98% of users have performing financing accounts.