samchain/econo-pairs-v1 huggingface dataset:
This, by the way, is another example of how providing financial services to the wider economy – in this case financing low carbon alternative technologies, has a positive feedback to balance sheet strength by reducing risks on both the asset and liability sides.2  2  See speech by Anna Sweeney (2020): Paving the way forward: Managing climate risk in the insurance sector 4  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  4  Following the crisis some companies will enter the recovery phase with more highly leveraged balance sheets, some from a starting point that was arguably itself over-leveraged. And structural change will create opportunities for new enterprises, often better financed with equity than debt. In his June remit letter to the Chancellor, the Governor made the case for introducing more equity, or more equity-like finance to the mix.3 Equity issuance by public listed companies is already strong and at its highest level so far this year compared to the same point in any year in the past decade.4  With their long-term liabilities, insurance companies and pension funds are well suited investors in growth capital. For some time now, insurers have been increasingly turning to illiquid assets for a good return on their investments at a time of historically and enduringly low yields. This trend has been most noticeable for annuity providers, incentivised by the matching adjustment (MA) to invest in assets that, perhaps with some restructuring, mirror the illiquid nature and fixed cashflows of their liabilities.

The banks in Bulgaria have an important year ahead, which we expect to be overall successful for the sector. Banks’ operations continue to take place in an environment of rather optimistic attitudes of enterprises and households amidst a relatively high growth of the Bulgarian economy. At the same time, the external environment holds risks and insecurity that, due to the openness and international integration of our economy, could potentially affect the economic 1/2  BIS central bankers' speeches  situation in Bulgaria. Some adverse scenarios could exacerbate aspects of the risk profile of the banking sector. Therefore, it is essential that in their behaviour banks continue to take into account the main risks, including profitability risks and asset quality risks. 2/2  BIS central bankers' speeches
In recent years, digital payment solutions such as e-wallets over mobile devices have emerged, and nowhere is this more obvious than in Asia. From 2015 to 2016, non4 . cash transactions in developed Asia-Pacific grew by 8.8% while that in Emerging Asia experienced 28.6% growth1. Digital payments in Asia are forecasted to grow annually at 16.4% 2 to reach over USD 2.5 trillion per year in 2022. That is almost half of the estimated worldwide total of USD 5.4 trillion. 5. Such services are often offered by non-banks, increasing the number of payments being handled outside the traditional banking system. EY and DBS3 found that payments and remittances were the highest-adopted FinTech services among banking and financial services customers in Asia, reaching 40% in China and 20% in India. In ASEAN, approximately one-third of FinTech companies are in the payments space, and this increases to 54% if you include money-transfer and remittance services4. These innovations did not come about by chance, but rather through a confluence of three factors: 6.  a. Technology has lowered the barrier to entry to run a standalone payments business, without being a bank. b. The high penetration of smart phones running apps has made it easier to acquire customers 1/6  BIS central bankers' speeches  digitally, without physical places of business; and c. The boom of online e-commerce has necessitated the creation of solutions to help customers to pay digitally for services that they in turn purchase digitally.

Looking ahead, we recognised that we needed two more measures: to require participants to use a common platform and to adopt common standards (such as SGQR). C. GOING CROSS BORDER 4/6  BIS central bankers' speeches  As we aim for interoperability and efficiency within our domestic systems, it is equally important to look beyond and to look outwards. A lot of commerce and e-commerce 19.  is carried out across borders today: Cross border e-commerce alone is expected to expand strongly, by approximately 25% annually until 2020, nearly twice the growth rate of domestic ecommerce10. And just as more people travel and work overseas, and more businesses find ways to deliver goods and services overseas, payments will also need to keep up. Among Singapore’s list of priorities as ASEAN Chair this year is to promote the growth of e-commerce in the region. Google and Temasek estimated that e-commerce in 20. ASEAN could amount to USD 88 billion in 202511. Cross border payments that are affordable, secure, and instant, will play an important role in driving e-commerce trade flows and achieving this vision. Although cross-border linkages offer huge benefits in important areas of the economy such as trade and tourism, implementing them is an up-hill task because of 21.  complexities like different technical interfaces, and legal and regulatory requirements in each jurisdiction. Each country is also in a varying stages of development. But we are making progress: a.
The entire Executive Board and most of the members of the Monetary Policy Department take part in this meeting. In addition, a number of advisers to the Executive Board and employees of the Financial Stability Department usually take part. A summary of the new information and the current status of the economy in Sweden and abroad is presented at the meeting. We also run through the alternative scenarios ordered at the risk meeting a few weeks earlier and discuss whether they really capture the risks that we Executive Board members envisage. We also have the opportunity at this meeting to request more information on various issues considered important to the coming decision. The meeting usually takes around three hours. Monetary Policy Department establishes its forecasts At approximately the same time as the meeting with the Executive Board, the Monetary Policy Department establishes its view of macroeconomic developments over the coming three years. In a preliminary stage it focuses on around ten key variables such as inflation, interest rates, GDP, number of hours worked, exchange rates and resource utilisation. The forecasts are produced on the basis of the exogenous conditions, the international forecasts, the model forecasts for the Swedish economy conditional on the current situation and assessments. The forecast for the interest rate path produced by the Monetary Policy Department is meant to reflect the Executive Board’s normal, historical behaviour. It is not  6  BIS Review 77/2008  any form of recommendation from the Department.

Before I go any further, I need to give the standard Fed disclaimer that the views I express today are mine alone and do not necessarily reflect those of the Federal Open Market Committee (FOMC) or others in the Federal Reserve System. Questioning the Assumption The idea of a natural rate of interest has been around ever since the Swedish economist Knut Wicksell wrote about it in 1898. Early on, it was recognized that it's not something that can be directly observed or measured. As the economist John H. Williams wrote in 1931: "The natural rate is an abstraction; like faith, it is seen by its works. One can only say that if the bank policy succeeds in stabilizing prices, the bank rate must have been brought in line with the natural rate, but if it does not, it must not have been. "1 The topic gained renewed relevance in 1993, following John Taylor's famous description of a monetary policy rule that incorporated an assumption of a natural rate of 2 percent.2 For policymakers, the natural questions—pardon the pun—were: Is 2 percent the right number? Does it change over time? And how would we know? Those were the very questions than then-Federal Reserve Governor Larry Meyer posed to Board staff back in 2000. And that's what brought Thomas and me together. A Meeting of Minds In July of that year, I returned to the Board from a stint at the Council of Economic Advisors, shortly after Thomas joined the Board staff from the Kansas City Fed.
In response to its Remit set by the Chancellor, the Governor replied on behalf of the FPC in August that: “The progress made in fixing the fault lines in the banking system means that the Committee is now more able to broaden its focus to potential risks emanating from and associated with non-bank activities. By balance-sheet size, nearly half of the current UK financial system consists of non-bank financial institutions. Capital markets are an increasingly important source of financing for the UK corporate sector and beyond, and globally almost all net finance growth since the crisis has been in market-based finance. A broad agenda encompassing non-banks is necessary to ensure that any potential systemic risks from market-based finance are identified and also that risks do not migrate from one part of the financial system to another.” “The Committee will (also) review a number of activities in the non-bank financial system over the next year, to consider potential systemic risks posed by: the investment activities of open-ended investment funds and hedge funds; securities financing transactions; the nontraditional, non-insurance and investment activities of insurance companies; and derivative transactions. These reviews will complement the Committee’s annual stocktake of risks outside the core banking system.” In the rest of this lecture I am going to focus on deposit takers and, to a lesser extent, insurance firms, which are the sectors most subject to regulatory reform to date.

For example as we move closer to ending too big to fail, and with standardised compensation schemes for retail depositors, one could reasonably ask why we need the same degree of regulation at all? Has the cost of providing credit to the economy been increased? Will the reforms restrict competition and innovation? Have capital markets been rendered dysfunctional? It is possible that there are degrees to which all these questions might have positive answers. But against that, the consequences of the Great Financial Crisis were so large, so negative for millions of people around the globe in terms of unemployment and reduced incomes, that more regulation, in every direction has been a necessary response. Over time one may learn where the reforms can be eased, where they  12  Bank of England/FCA/HMT, June 2015. “Fair and Effective Markets Review”. BIS central bankers’ speeches  11  need to be tightened, or whether other policies need to be introduced to offset any unwanted side effects. Let me re-state what has been said before – the authorities generally, including regulators, do not want the stability of the graveyard. We want successful, profitable, privately owned firms operating in the best interests of the global economy to support sustainable growth. The regulation of the financial services sector has to be aligned with that. But just as we don’t want growth generated by firms causing excess pollution, nor do we want it sustained by financial firms that take excessive risks with other people’s money.
In keeping with new global liquidity standards, banks have changed their funding models and their liquid assets – relative to their liabilities that can readily run – are tenfold higher now than before the crisis. Regulation has also made banks less complex and more focused. Trading assets have been cut in half, and interbank lending is down by one-third. Second, the growth in assets under management, from around $ trillion a decade ago to over $ trillion today, is bringing welcome diversity to the financial system, but is also increasing the risks of sudden stops and sharp capital reversals. Chart 12: Structure of external liabilities for emerging market economies  Sources: IMF, EPFR and Bank of England calculations  For EMEs, market-based finance has accounted for all the increase in foreign lending since the crisis, as bank lending has declined and FDI has stayed fairly constant (Chart 12). 13  All speeches are available online at www.bankofengland.co.uk/speeches  13  Within market-based finance, investment funds are growing, accounting for the bulk of the growth in asset management over the last decade. In parallel, investment fund flows to EMEs now account for around one third of total portfolio flows, compared to around one tenth pre-crisis.

It models the entire distribution of gross capital inflows to emerging market economies (EMs) based on a set of covariates, and focuses on the dynamics of the left tail of those conditional distributions, which is taken to be the relevant measure of capital flows-at-risk. In the baseline specification, the distribution of capital flows is estimated conditional on proxies for “push” and “pull” factors. For this purpose, the framework makes use of in-house financial conditions indices (FCIs), which measure co-movement in a series of financial indicators at the country level. 34 The global average of these indices is considered to be a summary measure of “push” factors, and the residual obtained from regressing country indices on this global FCI to be a country-specific summary measure of “pull” factors. For different horizons (h) and quantiles (φ) of the distribution, a panel regression of capital flows is performed on a constant, and the proxies for push and pull factors:35 KF@R i,t+h,φ = αt+h,φ + βt+h,φ 𝑃𝑢𝑠ℎt + γt+h,φ 𝑃𝑢𝑙𝑙i,t+h,φ + εi,t+h,φ  (1)  This specification allows capital flows-at-risk to be estimated, which is measured as the 5th percentile of the distribution in the baseline case. This specification is estimated on quarterly gross-inflows from non-residents to a set of 13 EMs over the period 1996-2018.36 The specification is estimated separately for FDI, banking and portfolio flows, and a split of portfolio flows into those intermediated via investment funds and those which are not.
When thinking about the set-up of national fiscal stabilisation policy in a monetary union intended to create credibility, these five guiding principles – consistency, commitment, transparency and accountability, coupled with independence of policy makers – are a good starting point. Fiscal stabilisation policy set-up Turning to its design, three relevant questions provide a framework for discussing the set-up of a fiscal stabilisation policy regime for a country in a monetary union: what is to be stabilised, how should it be stabilized and who should do the stabilising? 6 Addressing what is to be stabilised, two alternatives that were discussed in Sweden were the output gap and the inflation rate. Irrespective of what target is chosen, it should apply in the medium term, thereby allowing temporary deviations in the event of shocks hitting the economy. In the case of an  6  6  This discussion is based on Boije, Borg and Eklund (2002) and Boije and Shahnazarian (2003). BIS Review 73/2006  inflation target, it should be designed in such a way as to take account of necessary changes in relative prices; i.e. allowing for adjustments in the real exchange rate. Different targets have different advantages and drawbacks. For our purposes, when discussing the framework, it is more important to stress that the motives and forecasts behind the stabilisation policy decisions should be presented in a clear and open fashion. In turn, this helps build credibility through accountability. How is the policy objective to be stabilised?

8  BIS Review 73/2006
William C Dudley: The recovery and monetary policy Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York and Chairman of the Committee on the Global Financial System (CGFS), at the National Association for Business Economics Annual Meeting, New York City, 15 October 2012. *  *  *  Good morning. It is a pleasure to have the opportunity to speak at this NABE (National Association for Business Economics) conference today. Having spent more than 20 years as a business economist working in the private sector before joining the Federal Reserve Bank of New York in 2007, I feel right at home here today. My remarks will focus on the economic outlook. I do this with some trepidation, of course. In the private sector there are two adages about forecasting that underscore the need to be humble in this endeavor: First, forecast often. Second, specify a level or a time horizon, but never specify both, together. But more seriously, despite the difficulties in making accurate forecasts, we still need to understand as best we can why the economy is performing the way it is, what that implies about the economic outlook, and, how policymakers can respond to generate better outcomes. We live in a highly complex and uncertain world, but we need to make as much sense out of it as possible.

In my speech today, I would like to explain our negative interest rate policy. I will start by clarifying that there are two reasons for the low or even negative interest rates in many countries. First, the global equilibrium interest rate has fallen over recent decades. Second, since the financial crisis, monetary policy worldwide has been expansionary as a result of low inflation and weak economic recovery. For Switzerland, a country with generally low interest rates, these two factors – a long-term decline in the equilibrium interest rate and expansionary monetary policies around the world – have made the negative interest rate necessary in order to ensure appropriate monetary conditions. As a small open economy, we cannot decouple ourselves from a global environment of low interest rates. In the second part of my speech I will look at whether the negative interest rate policy is fundamentally effective. As this status report will show, the laws of economics do not change significantly when interest rates turn negative. As far as the mechanism of monetary policy is concerned, there is therefore no reason why the policy rate should not be reduced below the zero lower bound in the case of a country like Switzerland. On the contrary: without negative interest rates, the Swiss franc would have appreciated even more strongly, growth would have collapsed, accompanied by even lower inflation, and unemployment would have risen.
For Hong Kong, we have in our linked exchange rate system the most extreme case of an exchange rate target that is perceived to be impregnable – and has been proved to be impregnable under the most adverse of conditions. The link, in combination with sound fundamentals and well managed banks, has helped us through the recent crisis: not without hardship, it must be acknowledged, but with considerably less damage and uncertainty than we would have experienced had it not been in place. The tight discipline it exerts on our economy is helping to propel improvements in productivity, an important element in our current robust recovery. Indeed, the evidence to date suggests that Hong Kong experienced one of the fastest rebounds in productivity growth in the region. Labour productivity, measured in terms of GDP per person employed, registered the strongest gains of 10% in the post-crisis period, well above other Asian economies, whose gains were in the range of 5 to 8%. Because the exchange rate link suits an externally oriented, entrepot economy, it will continue to serve Hong Kong well in its expanding role as a regional and international hub, as China enters the WTO. And this applies, it should be added, regardless of the path taken by the renminbi – a path that will likely involve careful and controlled experiments with greater exchange rate flexibility in the not too distant future, and cautious and considered moves towards currency convertibility in the fullness of time. Technological advance 20.

In this area, Hong Kong has been one of the first regulatory authorities to issue guidelines that, among other things, require banks to ensure that their internet security platforms are airtight and that risk management systems are properly in place. We have strengthened our supervisory skills and resources to enable us to check that this is being done. This is not going to be an easy process. No-one can predict what directions technical innovation, customer behaviour, or latent practical problems will take. The challenge for regulators like the HKMA is to seek a balance between not allowing these developments to bring unmanageable risk and not stifling the application of useful new technology by holding back innovation. It is a difficult balance to achieve. Too great an interest by the regulator in new initiatives by the bank can often be misunderstood as heavy-handed over-regulation. The answer to the dilemma, clearly, is for regulator and industry to work hand in hand in a constructive way. Our policy in this, as in other areas, is to consult with - and listen to – the industry organisations as well as to the public at large and its representatives. 24. In other areas of its work, the HKMA has itself become something of a pioneer and is currently a clear leader in this time zone. Of particular importance here is our work on financial infrastructure. This is how we look at the matter.
At the same time, the debt service for new loans taken by households earning minimum to average wage economy-wide went up by 2 percentage points over the last 12 months. Considering that almost 30 percent of the borrowers with housing loans earn minimum to average wage economy-wide, a significant share of households report worrying indebtedness levels in the event of unfavourable developments. Moreover, the access to financing is much more reduced for individuals in the lower quintiles: only 1 percent of the individuals in the first three quintiles took a housing loan (Figure 29). The low interest rates and the granting of loans in lei improved access to financing, but the upward trend in property prices offset these developments. Housing loans show a higher sensitivity to consumer loans, to possible shocks on the interest rate, the income or the exchange rate, given their maturity and the higher amounts taken. In the context of the historically low interest rates seen at present, the main mediumterm risk comes from the impact of future rises in the financing cost on the indebtedness level. The DSTI ratio for housing loans would witness the largest increase in the event of a 2 percentage point interest rate hike (by 5.3 percentage points, Figure 30). By breakdown, the interest rate shock would generate an approximately 10 percentage point advance in the share of debtors with a DSTI ratio above 40 percent.

The portfolios for which the expected loss will be higher than current impairment loss are those of loans granted to the retail segment and regional governments. Heterogeneity is higher for banks at individual level, but is not likely to affect their stability considering the substantial surplus in solvency indicators (Figure 17). Starting with this issue of the Report, the NBR Board has decided to contain the number of presented risks to five at most, for two reasons: the opportunity to focus the analysis and draw attention to the most important messages, and the harmonisation with international good practice of central banks that publish financial stability reports, the ECB in particular. A full comparison with the risk map in the previous reports is therefore unfeasible. 3  No severe systemic risk has been identified, but a combination of the identified risks may induce a severe risk, amid unfavourable market conditions. The main risks to financial stability are set out in the table below. Map of risks to financial stability in Romania Deterioration in investor sentiment in emerging economies Tensions surrounding macroeconomic equilibria Higher household indebtedness through both banks and NBFIs Weak payment discipline in the economy, vulnerabilities in firms' balance sheets Faster increase in property prices severe systemic risk high systemic risk moderate systemic risk low systemic risk Note: The colour shows risk intensity. Arrows indicate the outlook for risk in the period ahead.