samchain/econo-pairs-v1 huggingface dataset:
A third example of perceptions being at variance with reality was the prediction that the Mainland Chinese currency, the renminbi, would be devalued during 1999 and that the Hong Kong dollar would inevitably be swept down with it. It is true that the economic performance of the Mainland was for a time moving in a manner such that devaluation could have been judged a not unreasonable option. But those who predicted such an event tended to give insufficient attention to the fact that the renminbi is not a convertible currency, that the prevailing external position was strong, and that the authorities had made it clear that they were not contemplating devaluation. The read-across to the Hong Kong dollar required an even greater leap of the imagination. Our exchange rate had never been dislodged from its peg by previous depreciations of the Mainland’s currency, which have amounted cumulatively to some 75% over the period since the establishment of our peg in 1983. Moreover, any reasons for expecting a devaluation of the renminbi to have a knock-on effect on the Hong Kong dollar because of competitiveness considerations are weaker now than before, because Hong Kong has evolved much more as a complementary economy to the Mainland of China than as a competitor. As a final example I might mention the various misperceptions which people have had more generally about the relationship between Hong Kong and the Mainland of China, which have perhaps caused some volatility in financial market sentiment towards Hong Kong.

Banks should extend all necessary assistance to help these groups to migrate to the e-payment platform. To realise the full potential of the payment network, banks that offer cheque issuing and ATM cash withdrawal facilities should provide the full suite of funds transfer and electronic payment functionalities over the ATMs. Of the 20 banking institutions that offer ATM services, 17 of them today provide the IBFT service, a real time interbank funds transfer service that enable customers to transfer funds via the ATM in a safe and secure manner. Banking institutions are strongly encouraged to also offer the Interbank GIRO (IBG) via their ATMs as a lower cost option to the IBFT. With over 1,400 new ATMs deployment by MEPS over the next 5 years, in addition to the current 12,000 installed nationwide, there is a significant potential for the ATMs to be used as convenient access points to the public to conduct electronic payment and funds transfer transactions. The widespread availability and reach of the ATMs network should serve the needs of the public not just in the urban areas but also in the rural towns. ATM cards to be used for purchases at Point-Of-Sale terminals Whilst Malaysia has a population of about 29 million, we have a high penetration of 39 million ATM cards. The ATM cards issued by banks that are used for cash withdrawals also have the domestic debit card application which can be used at merchants’ Point-Of-Sale terminals to make purchases.
And, at the same time, the launch of the programme of public guarantees to loans extended by financial institutions for a very sizeable amount is a most powerful lever enabling firms to finance their liquidity needs. This programme limits 21  the risk of firms disappearing and therefore preserves the productive system for the time at which the restrictions on activity imposed as a result of the pandemic are lifted. The data I shall later offer underscore the importance of these programmes of public guarantees to loans granted by financial institutions to firms, and particularly to SMEs, for the purpose of preserving the business sector and employment in the economy. It is highly likely that the interruption of activity, either completely or partly through the setting of maximum permitted numbers, will most sharply affect the tourism and leisurerelated sectors. In this respect, a temporary extension of the mechanisms implemented to date to provide liquidity to firms in those sectors that will be affected by the crisis over a longer period would seem desirable. Generally, the pace of the return to normality will evidently differ across the different productive sectors and firms. Accordingly, the fiscal policy response should also be tailored to these circumstances, with the dual aim of preserving that part of the productive system most affected by the crisis and containing the impact of these measures on public finances.

Sabine Lautenschläger: Banking supervision – what next? Speech by Ms Sabine Lautenschläger, Member of the Executive Board of the European Central Bank and Vice-Chair of the Supervisory Board of the European Central Bank, at the Banking Supervision, Resolution and Risk Management Conference during the 20th Euro Finance Week, Frankfurt am Main, 14 November 2017. * * * “What next in banking supervision and resolution?” is the title of this panel discussion. Well, before we discuss what comes next, let us take a quick look at what has happened in recent years. Since 2014, we have built European banking supervision from scratch. We have hired people, devised methods and set up processes. There are certainly still things that need to be improved, but by and large the system runs smoothly. As that is the case, there will be less construction work to be done in the years ahead. But this doesn’t mean that we will sit idly by, quite the opposite. The banking sector is facing a whole range of challenges, as you well know, and we have our part to play. Let me mention a few points – and it’s not a comprehensive list. There is the banks’ search for profitability and their need to cut costs and adjust their business models. There is Brexit. There is digitalisation and there are cyber risks. There are the Basel III reforms, which need to be finalised and then implemented. And there are efforts to further strengthen proportionality.
So this situation hardly constitutes a macroeconomic problem at present. In actual fact, one of the aims of the low interest rates has been exactly to create conditions for households to reduce their saving and maintain their consumption in the weaker economic climate. In spite of this, there is reason for the Riksbank to monitor developments carefully. There is also good reason for individual households to reflect on their debt situation. Interest rates are unusually low at present and will most probably change in the future. On the whole, there is no reason to make any marked adjustment to the overall outlook for demand in the Swedish economy in the coming years compared with in December or February. Most factors still indicate that growth in household consumption will continue to be stable around 2.5 per cent in the  2  BIS Review 16/2004  years ahead. The contribution to growth from exports will probably be somewhat higher than previously expected, but a large part of the effect on demand will be offset by the fact that this could also be the case for imports. Local government consumption appears to be somewhat weaker than we thought in December. Investment is a source of uncertainty and could probably pick up somewhat later than forecast. On the whole, therefore, GDP growth may be roughly as we expected in the December Inflation Report and when we took our decision in February, reaching around 2.5 per cent per year in the years ahead.

Governor’s Speech - the Budapest Eurasia Forum 2022 “Challenges facing small, open economies in the changing global landscape” Dr. Sethaput Suthiwartnarueput, Governor, Bank of Thailand Magyar Nemzeti Bank, Budapest, 19 September 2022  Excellencies, distinguished participants,  It is a great pleasure and privilege to be here at the Budapest Eurasia Forum. While the global landscape is constantly changing, the speed and scale of the changes happening now are particularly large and rapid. Many of these changes pose particular challenges for small, open economies. I would like therefore to focus my remarks on three key challenges facing small, open economies in this changing global landscape. Part 1: The first challenge is rapid and synchronized monetary policy tightening •  We are going through one of the most rapid and concerted monetary policy tightening cycles in recent memory. About this time last year, the Fed Funds rate expected for the end of this year was under 0.5%; markets now expect it to be around 4%. Almost all central banks have raised rates as part of what one might call the “Great Policy Normalization”. This reflects the rapid return of inflation. Two years ago, of the 60 countries tracked in the BIS database, 42 had inflation below 2%. Today, that number is zero. •  Adding to the challenge, the prevailing initial conditions under which the major economies are embarking on this “Great Policy Normalization” are far from ideal.
We are now seeing annual rates of increase in housing prices of between 15 and 20 per cent, at the same time as household indebtedness has started to accelerate upwards again (see Figure 6). 5 There is a connection between the development of housing prices and household indebtedness because housing purchases are largely funded by loans and large parts of households’ debts are made up of mortgages. Monetary policy faces a choice between, on one hand, the development of the exchange rate, inflation and inflation expectations and, on the other, the development of household indebtedness. My assessment is that, at present, it would be difficult to maintain a higher repo rate to manage the risks linked with household indebtedness. The krona would then risk appreciating and demand in Sweden could become too low – inflation may not reach the target as planned and inflation expectations may not become anchored around the target. Figure 6 Housing prices and household indebtedness in Sweden  Sources: Statistics Sweden and Valueguard. The expansionary monetary policy is contributing to stable inflation... Our assessment is that the monetary policy being conducted will allow us to safeguard the credibility of the inflation target, which is vital for achieving price stability. However, household indebtedness risks threatening both price stability and financial stability. You could put it like this: Monetary policy is the policy area that has the best conditions for influencing the exchange rate and inflation.

Lowering the limit to 80 per cent would lead, over a 10-year period, to about the same effect as the proposed amortisation requirement, and even lowering it to 75 per cent would result in a smaller effect looking 10 years ahead than a debt-to-income limit of 600 per cent. It is clear from what I have said so far that it is hard to find an individual measure which could prevent indebtedness from increasing from a 10-year perspective. A combination of measures may therefore be needed. One example of a “package of measures”, which I have discussed on previous occasions, includes an amortisation requirement, halved tax relief and a debt-to-income limit of 400 per cent. A summary of the effects of these measures offers a very rough estimate of the total effect, and indicates in this case that indebtedness would level out to around the level seen today (see Figure 14).
I want to thank you all for your support, trust and commitment, which has enabled us to reach this first step towards an integrated, more efficient, and harmonised post-trade market in Europe. In particular, I would like to take this opportunity to thank the national communities, namely the national central banks, the securities depositories and their clients, for their involvement and cooperation. Moreover, I would like to thank the 4CB (composed of Banque de France, Deutsche Bundesbank, Banca d’Italia and Banco de España) for developing and now also running the T2S platform. Let me also acknowledge the hard work and dedication of the people at the ECB who coordinated the implementation of the project. In particular, I thank Jean-Michel Godeffroy, who steered the T2S ship through sometimes stormy waters for many years, and Marc Bayle, who brought the ship to a safe harbour on 22 June 2015. And a special thanks to Ms Tumpel-Gugerell, who was the ECB board member in charge during the project’s inception. A popular saying is that “Two heads are better than one”. From the very beginning T2S has managed to unite the efforts of both the private and the public sector. T2S was not initiated by the market, but owing to its post-trade harmonisation agenda it has evolved into a marketdriven initiative which is supported by the public sector. In many ways it has been a unique project. First of all, no one was forced to join the T2S Community.

The Danish krone will be available for settlement in T2S as of 2018. Some of the other non-euro-area central banks have also expressed an interest in joining at a later stage, as soon as their markets are ready. I am confident that, following the successful launch, more markets and currencies will be interested in joining the platform, paving the way for T2S to embrace the diversity of Europe and become a truly panEuropean platform. Like the speakers in the panel discussion who shared their vision for the post-trade industry ten years from now, we should think about what happens next. The capital markets union, once established, will be a great step forward. But is more needed in the market infrastructure arena in order to progress on the journey towards an integrated financial market in Europe? One helping hand will be the synergy between TARGET2 on the cash side and T2S on the securities side, which certainly brings new opportunities. The objective should be to better meet the demands of the market and increase efficiency. Our journey continues. What I am sure of is that the story of T2S is successful because of each and every one of you. To celebrate this great achievement, I would like to invite you for a drink in the beautiful garden outside. Thank you. 2  BIS central bankers’ speeches
BIS Review 28/2010  By acting in this way, marking to market has the potential to serve as an amplifier of stress in the financial system. 19 Other things equal, it could result in sharper and more severe asset price falls than in the past, accompanied by greater institutional stress. It could exaggerate excess volatility and misalignment. Marking to market may not just be a casualty of the failure of EMH; it may also be a cause. Hyun Shin has likened the destabilising dynamics of mark to market to the unstable oscillations of London’s Millennium Bridge at the time it opened. In finance, these adverse dynamics have a much longer historical pedigree. In their classic monetary history of the United States, Friedman and Schwartz assigned mark to market a key role in propagating banking failure during the Great Depression. 20 The evidence of such dynamics during this crisis is more mixed. Some studies have claimed this effect was limited to banks with large trading portfolios; 21 others that it has been significant and wide-ranging across the financial sector. 22 Perhaps the truth lies somewhere in between, with some market and institutions affected and others immune. Chart 8 plots commercial property values in the UK since 1920. There are five discernible boom and bust cycles in commercial property, signified by the dotted lines. Chart 9 looks at the cumulative falls in value during the bust. In four of the cases, the bust was similarly timed and sized.

As discussant for today’s lecture, we are privileged to have Dato Dr Zeti Akhtar Aziz, who has been Governor of Bank Negara Malaysia since May last year, and who is another one of the ‘classmates’ at BIS. I have known Dr Zeti for some years now and benefited from her wise counsel, particularly during the time when she was Assistant Governor in charge of economic research. Dr Zeti is a career central  BIS Review 13/2001  1  banker who joined Bank Negara in 1985 and who has taken up various important positions within Bank Negara. She played a pivotal role in steering, very successfully, Malaysia through the Asian Financial Crisis and in introducing the very important financial sector reforms. Dr Zeti is therefore able to offer a particularly practical perspective on today’s theme, and I look forward to her comments with much interest. Ladies and Gentlemen, I now have great pleasure in calling upon our speaker, Mr Andrew Crockett, to deliver the fourth HKMA Distinguished Lecture. Mr Crockett, please. 2  BIS Review 13/2001
This was considered so remarkable that it was given its own name – The Great Moderation. The reasons for the Great Moderation have never been made entirely clear, but many people felt that one important explanation was that policy, and perhaps in particular monetary policy, had begun to be conducted in a better way.1 Compared with the economically much more volatile 1970s and 1980s, there was much greater focus on keeping inflation in check. To make this easier, many countries had transferred responsibility for monetary policy to independent central banks. Moreover, an increasing number of countries had introduced something that was a monetary policy innovation in the early 1990s – inflation targeting. It appeared as though one had not only succeeded in checking inflation, but also managed the cyclical fluctuations reasonably well and laid the foundations for a good development in the economy in general. It was so successful that it may have led to a blind faith in the precision of monetary policy and what it can achieve. It was assumed that the financial markets were, on the whole, efficient and functioning smoothly, at least in the industrial nations. Of course, financial crises were still considered possible, but as isolated events, often caused by individual economies being mismanaged. The contagion effects were assumed to be limited and the prevalent opinion was that wise crisis management could relatively quickly get the economies concerned back on track.

It is estimated that the growth of our economy will continue to be underpinned, above all, by national demand, but with a positive – though diminishing – contribution from the external sector. In particular, household consumer spending and residential investment will continue to be assisted by rising employment, the sector’s improved financial position, the fiscal impulse and favourable financial conditions. Also, the growth of demand and of corporate earnings, higher capacity utilisation and the aforementioned propitious financial conditions will continue to provide for significant increases in investment in capital goods. Nonetheless, the tailing off of some of the temporary factors that have supported the increase in activity in Spain in the most recent period would explain the moderation in growth expected in the coming years. This would be the case were there to be a reversal in the trend of oil prices, in the expansionary effect of monetary policy and in the momentum of external markets, following their significant dynamism last year. As regards prices, the latest data continue to show, as in the euro area as a whole, very moderate behaviour, with the year-on-year growth of the CPI standing at 1.1% in April. The Banco de España projections published in March augured an increase of 1.2% for the year as a whole; however, it might ultimately be higher owing to the impact of the recent rises in oil prices. In this respect, the current volatility on the oil markets adds further uncertainty to the evolution of prices in the short term.
Uncertainty, however, does not mainly come from the economic environment; it comes from the erosion of trust, based on an unbalanced distribution of globalization benefits, a long and slow recovery, decentralization and fragmentation – as the IMF’s First Deputy Managing Director David Lipton pointed out in a recent speech1 . The REO also speaks about the weakening support for globalization, which affects global trade and long term growth prospects, a thesis linked to the apparent retreat from cross-border integration and the move from multilateralism to bilateralism. And the report is right, in my view. After 3 decades of deregulation and liberalization, the consensus is being threatened by the return to protectionism. East European countries, being at the receiving end of capital movements, are the short term losers of what it looks like an exit from globalization as we knew it. I call this exit from globalization “Glexit” – which is much more than Brexit or any other individual exits. In the banking sector, Glexit means further deleveraging and higher financial burden for already over indebted nations, companies and households. We can do more, together, to rebuild trust in institutions, to improve the governance, and to make sure that the economic upswing that we are now enjoying will be more evenly distributed, that it will reach every household and company. While this is a long time-effort, we need to do more to put our house in order now.

However, there is still no consensus on operationalizing the EDIS, on debt mutualization, on setting the minimum requirement for own funds and eligible liabilities, on the features of the fiscal union, and the list could go on. I think that the Union should also clarify the fine balance between the consolidated microprudential supervision of banks and national accountability in terms of resolution. The home-host issue has not been dealt with yet. Moreover, the European financial architecture is populated with unfinished, incomplete, or untested mechanisms created after the crisis. Even so, my message on the reform of the European financial sector is twofold. First, the reform is fundamental for the success of the European project. Romania welcomes all the European Commission’s initiatives aimed at enhancing supervision, consolidation, and accountability in this area, and we will do our best to help reach a consensus on these proposals during our incoming EU Presidency. Second, it is also fundamental for the integrity of the European project that euro-area should not be ring-fenced; the reform should still make it possible for non-euro countries to join euro, when they will be ready, on a level playfield. Price stability and financial stability are two sides of the same coin. You can’t have one without the other – this is a lesson that history has recently taught us. And none of them is possible without credible public policies. 1. Lipton, David (2018), “Trust and the Future of Multilateralism”, Introductory Remarks for the  Eurofi High Level Seminar, Sofia, Bulgaria, April 30, 2018. 2.