samchain/econo-pairs-v1 huggingface dataset:
This legislation will not only affect the banks that we supervise, but also our own supervisory system and the tools we use to carry out our responsibilities, so I hope my additional perspectives will be useful. The publication of Basel II in June 2004 was a milestone which marked the culmination of a worldwide and unprecedented effort spanning more than five years. It involved extensive and open discussions among bankers, central bankers, bank supervisors, market observers, and the public. The Basel Committee published three proposals for public comment. It conducted several impact studies and it engaged in extensive discussions with interested parties. I believe that this broad and often highly technical dialogue was of mutual benefit as a learning process. It contributed greatly to the thorough examination of banks’ risk management practices. This was necessary in order to find ways to harness recent advances in these practices to promote financial stability. It also allowed us to take into account concerns and suggestions and to make a considerable number of changes that have significantly improved the framework. Let me mention, for example, improvements made in important areas such as SMEs, procyclicality, complexity, recognition of collateral, and the treatment of securitisation, etc. Likewise, the global nature of the consultations led to changes which increased the relevancy of the new framework to all kinds of banks, something that is important for the European market. As a result of the dialogue, we were able to design a solid, comprehensive and balanced new capital framework.

Export demand was expected to rise at a slower pace, while domestic demand was forecast to increase somewhat faster, mainly owing to increased investment but also to a slightly stronger pick-up in private consumption. That was also assumed to contribute to an improvement in the labour market. Against the background of the continued cyclical upswing and expectations of a reduction in spare resources, domestic inflation was forecast to rise. Higher wage costs in line with an increase in employment and lower productivity growth was assumed to imply a faster increase in unit labour costs and a gradual rise in companies’ costs. The factors that had resulted in falling prices for imported goods in the past year were estimated to gradually diminish during the forecast period, even though we anticipated that imported inflation would remain low in the period ahead as well. It is reasonable to expect that a pick-up in resource utilisation in the world economy will lead to higher international price pressures. We also made the assessment that the krona would not appreciate nearly as much during the forecast period as in recent years and that it would therefore not have as large a restraining effect on price increases in Swedish kronor in the period ahead. The shift seen in imports in recent years, which has involved a greater share coming from low-cost countries, is likely to continue, however, and probably depress import prices in the period ahead as well.
In order to properly understand what happened, we must consider the gradual shift that occurred in expectations and in economic policy during the post-war period. The thinking at the beginning of that period was still marked by the interwar period’s mass unemployment but also by the price stability of that time. Prices fell during some periods and rose during others. On the whole, the price level was stable during the 1930s, which was also the Riksbank’s explicit target at the time. Inflation expectations during the first post-war period were marked by these experiences, even to such an extent that the government prior to the post-war period announced in advance that the price level would fall as the productivity gains from the transition to peacetime production materialised. As the general price level actually rose, but never dropped, the public’s expectations of inflation were influenced accordingly. Expectations of rising prices worked their way slowly into people’s minds. During the period 1956-64, the general level of prices increased on average by 3.4 per cent a year; during the period 1965-74 by 5.6 per cent and from the mid-1970s to the mid-1990s by an average of 8.1 per cent a year. Between 1973 and 1982, Sweden devalued the krona six times after the Bretton Woods system, with its fixed exchange rates, had been abandoned. By the end of the 1980s, following successive increases in the inflation rate and repeated devaluations, inflation expectations had been anchored at a high level.

Eddie Yue: Opening keynote - "Scaling up sustainable finance in Asia" conference Opening keynote by Mr Eddie Yue, Chief Executive of the Hong Kong Monetary Authority, at the ASIFMA "Scaling up Sustainable Finance in Asia" conference, Hong Kong, 17 March 2023. *** Alice, Diana, distinguished guests, ladies and gentlemen, Good Morning, Let me start by thanking ASIFMA for inviting me to this Sustainable Finance Conference. It is my great pleasure to share with you Hong Kong's vision and the concrete steps being taken to strengthen our leading role in green and sustainable finance. As we come into Spring after a colder-than-usual winter, this is a good time to talk about the advances that happen when the right ecosystem is combined with the right opportunities. In the financial world, green and sustainable finance brings extraordinary opportunities. And if we are looking for the best ecosystem for these opportunities to flourish, Hong Kong is the place. The climate challenge to Asia is huge, and urgent. Meeting this challenge will require substantial investment – some $ trillion over the next three decades based on market estimates. China alone will require more than 100 trillion yuan. The multi-trillion-dollar funding need can hardly be met by the public sector alone, and climate finance plays a crucial role here. It helps the public sector raise funding from the market to finance climate projects and initiatives. It also mobilises private capital to directly fund climate actions.
Coinciding with uncertain growth prospects is the indecisiveness about the exit from policy accommodation especially in the U.S. Global market sentiments since May have turned with the expectation about the Fed scaling back its asset purchases. While all of us know that the exit from the extraordinary stance in the U.S. is inevitable, and is actually looming on the horizon, the timing and the pace remain uncertain and data-dependent. This could actually continue to disrupt the process of global rebalancing for a while. Time and again, taking away the punch bowl has always been a tricky task for central bankers. But the impact has never been more global, given today’s interconnected global financial market. Inconclusive clues about the future world, after all, lead to increased sensitivity to new pieces of information. Beliefs about the future world are shifting fast, and with that come bouts of volatility due to successive rounds of reassessing and repricing risks. To some extent, the recent episode also served as a stress test for emerging market economies, who  BIS central bankers’ speeches  1  had to deal with sudden capital movements and volatile asset prices. It also served as a reminder for these countries to ensure that their economic stability is safeguarded as they try to benefit from the increased integration with the global financial market. And importantly, it also served as a reminder for these countries to re-examine the robustness of their growth strategy in the face of global headwinds and fickleness.

Given what we have experienced in the last two years, it is my hope that the international community will see the wisdom of not waiting for the next crisis to learn how we can make the international financial system a more robust and safe one for all of us.” 3. Ladies and Gentlemen, I made the above remarks over 10 years ago, in June 1999. It was ten months after the Asian Financial Crisis hit Hong Kong, which was then followed by the turbulence of the global financial system as a result of the abrupt collapse of the LTCM. It was rather unfortunate that the fear I expressed in 1999 has come true ten years later. The international community has failed to learn the lessons from the Asian Financial Crisis and the LTCM debacle and to make the financial system more robust and safer. As a result, we have been punished, and punished very, very severely. The latest Financial Tsunami, dubbed as “Once in a Century”, has demonstrated that somehow all the key safety valves and gatekeepers have failed functioning properly to prevent excessive leverage and risktaking within the financial system, leading to very heavy fiscal and social costs in the subsequent bail-outs. 4. Now the international community, led by G20, is trying very hard to draw lessons from this latest financial crisis. I sense that there is a very strong resolve to do something this time round.
In this way, I trust, we can reconcile those who feel left out, including many of the protesters gathered in Frankfurt this week, with a process of integration that has already generated so many benefits for three generations of Europeans. Let me conclude. This building is a credit to all those who have worked to bring it to fruition. It is a landmark for the city of Frankfurt. And it provides the ECB with an impressive new home to pursue its mandate. But it also stands as a powerful symbol of what European integration is about. It reminds us of where we have come from and where we have come to. Of the horrors that can happen when we split apart, and the huge steps forward we can make when we work together. So let us not undo what has been achieved. Let us not hanker for the past. Let us draw on the past to unite us in the present – to build a complete Union that can deliver the stability and prosperity we need. We as the central bank will do our part in this process by ensuring the integrity of our single currency. Our shared money is the most tangible sign of the trust we place in one another. As the ECB’s first President, Wim Duisenberg, put it at the launch of the euro more than 16 years ago: “A currency is far more than just a medium of exchange … A currency is also part of the identity of people.

BIS central bankers’ speeches  1  As an EU institution that has played a central role throughout the crisis, the ECB has become a focal point for those frustrated with this situation. This may not be a fair charge – our action has been aimed precisely at cushioning the shocks suffered by the economy. But as the central bank of the whole euro area, we must listen very carefully to what all our citizens are saying. There are some, like many of the protestors outside today, who believe the problem is that Europe is doing too little. They want a more integrated Europe with more financial solidarity between nations. And there are others, like the populist parties we see emerging across Europe, who believe that Europe is doing too much. Their answer is to renationalise our economies and reclaim economic sovereignty. I understand what motivates these views, why people want to see a change. Yet in truth neither offers a real solution to the situation we face today. Solidarity is central to European integration and it is right that countries have supported each other during the crisis. But the euro area is not a political union of the sort where some countries permanently pay for others. It has always been understood that countries have to be able to stand on their own two feet – that each is responsible for its own policies.
I am convinced that South Eastern European countries, that is EU candidate and potential candidate countries, will have an opportunity to broaden their knowledge about what to do and what to avoid on the road to EU. At the same time, we will also share the experiences about the challenges that the South Eastern European countries face with on their way to the real convergence. The transformation of the Central and Eastern European countries and their final membership in the EU is one of the most remarkable events in human history. Never before had so many countries and people made so many changes in such a short time. During the 1990s, we witnessed a complete renewal of entire systems and institutions, implementation of structural reforms, but also establishing new ways of living and thinking. What is important for us here is that these changes were happening simultaneously with a huge rise of income and living standards in general. Although not a perfect indicator for the remarkable changes, the comparison of GDP per capita in the beginning of transition and now shows a clear picture of the progress. In 1993, the group of 10 new EU member states had a GDP per capita that was 37.2% of the euro-zone level at that time, but in 2007 this indicator reached 56.4%. 1 Certainly, not all transition countries were moving with the same speed, and not all of them reached the same level of income. Among this group of countries, the three Baltic countries were moving the fastest.

Nominal convergence about which we, central bankers, speak the most, is consisted mainly of convergence of price levels, but also of exchange rate changes, interest rates and budget deficits to EU levels. As an empirical fact, rises in relative CPI usually move together with rises in relative GDP, and emerging Europe was not immune to this trend. The CPI level in the new EU member states in 1995 ranged from 29.2% of the EU-15 level in Lithuania to 44.9% of the EU-15 level in Poland. In 2006, the CPI level ranged from 42.7% in Bulgaria to 71.8% in Slovenia, which clearly shows fast price rises in these countries. 5 It is obvious that the parallel processes of real and nominal convergence of countries in transition pose numerous challenges for their economic policies in general and particularly for their monetary policies. The process of real convergence creates inflationary pressures through a number of channels, thus making it difficult to fulfill one of the Maastricht criteria for entering the monetary union, and also the higher inflation generates negative effects on the competitiveness of the domestic economy. The BalassaSamuelson effect is one of the most frequently indicated channels through which real convergence leads to higher inflation rates. According to this concept, the faster productivity growth in the tradables sector compared to the non-tradables sector of a country will cause a positive inflation differential and afterwards real appreciation – through the rise of marketdetermined prices of non-tradable goods.
Private customers only face transaction fees when making payment transactions at the bank branch-office or when using cheques (although cheques are hardly ever used). Transaction fees are almost exclusively taken from corporate customers, particularly merchants. Cross subsidies between card payments and cash distribution Using the average bank’s costs and prices and data on transaction volumes for the different payment instruments, we could estimate the average large bank’s profit from the provision of different payment services. Our estimates show that the average bank makes a positive profit of approximately 155 million Swedish kronor in the provision of payment services. This calls to question the often stated view that a low interest rate is needed to finance a payment operation that is running at a loss. All payment services except for cash distribution generate net revenues for the bank. Credit transfers as a whole give a net revenue of about 160 million Swedish kronor. However, most net revenue is generated by card payments, in particular from acquiring services for charge and credit card transactions. The average bank has an annual surplus of 460 million Swedish kronor in card payments. Interestingly, the bank has an almost equally large annual loss from the distribution of cash to the public, of which two-  2/3  thirds come from ATM services. We can conclude from this that there are cross subsidies between these two segments where card payment transactions finance distribution of cash to the public.

Conclusions Summing up, our results imply that there might be considerable cost savings to be made by the banks through a more transparent and cost-based pricing This is because such a pricing strategy would lead to changes in the pattern of demand. Consumers would have economic incentives to shift to those instruments that are less costly to produce. According to our cost estimates, they would use debit cards more and credit cards and cash less and they would increase their use of electronic credit transfers and direct debits at the cost of paper-based credit transfers. A more cost-based price strategy would result in private customers facing transaction fees on paperbased and electronically-initiated credit transfers and in the introduction of transaction fees for cash withdrawals. Fees for acquiring services would have to decrease. The fact that Swedish banks do not take any fees whatsoever for cash withdrawals, while such fees can be observed in the other Nordic countries, may very well be the explanation for our greater use of cash and lesser use of card payments. Based on the data on variable costs and volumes, the banking sector could lower their variable costs by around 560 million Swedish kronor annually if bank customers replaced charge and credit cards and cash with debit card payments. The shift from paper-based to electronically-initiated credit transfers could result in a further reduction in the banking sector’s variable costs of almost 200 million Swedish kronor annually. One interesting issue to consider is the reason for this pricing strategy.
In 2000, although the inflation targets that were envisaged in the program could not be reached, significant progress was made in the fight against inflation, which reached its lowest level ever in the last 14 years. In addition, the fiscal balance improved considerably, and the structural reforms were underway. Interest rates came substantially down in 2000 as a result of the decreased exchange rate risk and the improved foresight of public. Declining interest rates reduced the cost of the Treasury’s domestic borrowing. Rising domestic debt stock was put under control. After the recession in the economy in 1999, falling interest rates boosted the deferred consumer demand, particularly for durable goods. Moreover, increased demand for credit, driven by the banks’ favorable consumer loans, put the economy back on the growth track. Besides the decreasing tendency in interest rates, the stable exchange rates and the private sector’s renewal investments, directed to productivity increase, also contributed to the growth in the economy. As a result, the GNP grew by 6.1 percent in 2000. However, the economic expectations became confused in the second half of 2000. Starting from May 2000, the gap between the optimists and pessimists in the CBRT’s Business Tendency Survey began to decrease and in November, the pessimist expectations started to gain ground. It is observed in this survey that also the expectations for inflation, employment and exports began to deteriorate in the same period.

Some firms proposed lengthening the period of time between examinations, including increasing the asset size limit for community banks to qualify for the 18-month cycle. In response, the agencies supported a change to statutes that govern examination frequency. Subsequent legislation enacted in 2015 permitted qualifying firms under $ billion in total asset size to be subject to an 18-month examination cycle for safety and soundness examinations. The final rule for this legislation was issued at the end of last year and is now in force. I should emphasize that a longer exam cycle does not mean we are neglecting our supervisory responsibilities and we will remain focused on the core drivers of safety and soundness. That is our responsibility as supervisors. While it was some time ago, it is useful to recall the FDIC study of the financial crisis in the 1980s that highlighted how quickly financial health can deteriorate and concluded that delayed recognition via less-frequent examinations contributed to the scale of losses and failures in the 1980s.3 In addition to our review of regulations, supervisors periodically review existing supervisory guidance to evaluate relevance and effectiveness. The Board completed a policy review of the supervision programs for community and regional banking organizations to make sure that these programs and related supervisory guidance appropriately align with current banking practices and risks. As a result of this review, the Board eliminated 78 guidance letters that are no longer relevant.
BIS central bankers’ speeches  However, it would be more appropriate if depositors are more fully aware of the basic fact of finance: higher returns are generally accompanied by a higher degree of risk and possible volatility, and depositors should be fully aware of this fact. The deposit guarantee scheme should not be exploited to hide this basic fact of finance. Furthermore, higher deposit rates would require increased loan rates or investments in higher yielding assets. Both of these carry risks which, in the current lower interest rate environment, may lead to greater risk being assumed than perhaps would be the case in normal circumstances. It is therefore prudent for such institutions to hold an increased level of capital buffers so as to compensate for the elevated risk. Indeed, in recent discussions which I had with another euro area central bank governor, an approach that his institution uses is to require higher capital requirements when deposit rates exceed Euribor by more than 300 basis points. This is an interesting proposal which merits further analysis. At the international level, the limitations of current regulation and supervision have become more and more evident with the severity of the financial crisis. Too much attention was focused on individual institutions thereby overlooking the macro-prudential risks. In reaction to this, European institutions and member states have engaged in a major overhaul of bank regulation and supervision, with the objective of making financial institutions safe, sound and transparent.

In recent months, Malta’s HICP inflation may have been biased upwards because of methodological changes related to the measurement of tourist accommodation. Meanwhile the RPI, which is unaffected by accommodation prices, stood at 2.9%. It is the RPI that determines with a lag the COLA increase. The core RPI inflation rate, which is a good gauge of persistent inflation, stood at 2.0%. BIS central bankers’ speeches  3  On the other hand, a number of labour market indicators remain positive. As seen in Chart 8, the most recent LFS unemployment rate is 6.5%, the same as it was on average in 2007, prior to the euro area crisis. In fact, Malta’s unemployment rate is at the lower end of national unemployment rates across the euro area. Meanwhile the latest registered unemployment rate stands at 4.2%, in June. Malta has avoided the two essential sources of the Euro area crisis: the deficit ratio has been moving in the right direction while the banking model followed by the core domestic banks remained prudent. In Malta, the core banks generally rely on traditional, domestic sources of funds, specifically retail deposits. Malta’s banks remained largely unaffected by the euro area crisis, averting the need for any government assistance and avoided what in other countries became a major source of fiscal overruns and distress. Malta must position itself in a way that builds on the strengths of the economy and minimises its vulnerabilities.