samchain/econo-pairs-v1 huggingface dataset:
Thank you. President Dudley: Well, first thing I would say is the level of interest rates are still pretty darn low. The federal fund rate, that’s the rate we target, is three-quarters of a percent to 1%. And we’ve only raised interest rates twice since the end of the Recession eight years ago. It’s important to recognize that the trajectory has been very, very shallow because we are aware of some of the issues that you’re raising and we’re trying to get the balance right. End of the day, what are we trying to accomplish? We want to have an economy that can grow for a long time. So, we want to keep the economy in balance growing at a rate that is sustainable over the medium- to longer-run. What we’re trying to do is find that level of interest rates that’s just right. Now we recognize that anytime that we change interest rates, it’s going to help some people, and it’s going to hurt other people. So, on the other side of the story are all the people, like my mom, who are savers and they’re unhappy. They’ve been unhappy for the last eight years because interest rates have been so low. So, we’re trying to get that balance right. I think we’ve been pretty cautious in terms of how we’ve been raising interest rates because of some of the concerns that you raise.

Fiscal policy is then best handled by the government, not by the central bank. The Riksbank's monetary policy is already expansionary and contributing to supporting demand in the Swedish economy. But there are limited possibilities to make monetary policy even more expansionary, in my opinion. There are, however, good possibilities to make fiscal policy more expansionary. I therefore believe that fiscal policy will play a larger role in stabilisation policy if economic activity weakens further in the coming years. Climate change entails new economic and financial risks Climate change is one of the structural changes I have talked about today. I have noted that Örebro was one of the first municipalities in Sweden that issued a green bond. Here at Kommuninvest, in Örebro, I think that it may be appropriate to conclude by elaborating on what I see as the Riksbank's role in the work to achieve greener financial markets. Climate change affects the way the economy functions. Its impact is most clear in the insurance sector, as a direct consequence of the risks of climate-related damage. The risks may also increase on the financial markets when various branches are forced into major changeovers as a result of demand, taxation or regulations being changed. 7 Monetary policy can also be affected more directly, for instance if economic data becomes more difficult to interpret when the effects of the weather lead to larger fluctuations in prices and production.
Ardo Hansson: Experience with and preparations for the euro Speech by Mr Ardo Hansson, Governor of the Bank of Estonia (Eesti Pank), at the opening of the conference on “Experience with and preparations for the euro”, Riga, 22 February 2013. *  *  *  Honourable Mr. President, Honourable Madame Speaker, Honourable Mr. Prime Minister, Excellencies, Ladies and Gentlemen, It is a great honor to be here today in Riga at this important conference and to be able to express my support for Latvia’s euro area aspirations. Looking to the future, and remembering all of the good help which we also got from other countries in the past, we would also like to give that same support other European countries joining the euro area. Let me begin by stressing that Latvia’s long track record of fiscal prudence and your recent very difficult but ultimately successful crisis management are recognized, welcomed and greatly respected in the euro area. In fact, Estonia and Latvia are good examples of the benefits of implementing decisive reforms, demonstrating that the beneficial effects of frontloaded fiscal consolidation, deep structural reforms and economic flexibility outweigh the initial higher costs, especially by quickly restoring the confidence that is so crucial for ending a crisis and getting a country on a path towards recovery and growth. One of the lessons we learned from this crisis is the importance of the issue of confidence. It is intangible, it is hard to measure, but it is so crucial.

For Estonia as a small European economy highly dependent on trade, euro area membership was a natural goal stemming from close economic ties and similar cyclical behavior. A common currency with many of our main trading partners would reduce the costs of trading and more importantly deepen the economic integration that can drive all of the productivity improvements that will ultimately lie behind higher living standards. Our main trading partners are in Europe, so it is not an international issue for us but domestically important if we want to grow. In any case, our strategic choice two decades ago to tie our currency first to the DM, then to the euro, and a clear determination to never change this peg, meant that our macroeconomic environment was already very similar to that of a euro area member, and that the extra step towards full euro area membership would only be logical and natural. Let me now turn to the process. When discussing such currency reforms, we often speak in terms of the date on which this takes place, which can leave the impression of a single event which suddenly brings great changes. In fact, the process element is crucial. We have been on a given path for 20 years, and we will be on this path for another few decades. Therefore,  BIS central bankers’ speeches  1  it is many small steps that contribute and the actual date of conversion is somewhat less of an event.
However, when interest rates are  2  BIS central bankers’ speeches  already very low, a decline in the Euribor is associated with a reduction in the interest margin (the price effect exceeds the quantity effect) as banks have less capacity to pass through the reduction in interest rates to retail deposits owing to their proximity to the zero-rate level. It is possible that these non-linearities may be exacerbated when interest rates move into negative territory. Chart 2  That said, there are also factors that mitigate the impact of low interest rates on results. In particular, low interest rate levels contribute to reducing loan loss provisions, insofar as they are conducive to a decline in non-performing loans. This mitigating effect is particularly significant in Spain, owing to the prevalence of assets with floating rates on bank balance sheets. 2.2  Non-performing loans  The second factor weighing down on bank profitability is the still-high level of non-productive assets on the balance sheets of banks located in specific countries, despite the continuing downtrend we have observed for some time. As can be seen in Chart 3, in some instances the NPL ratio exceeded levels of 15% in mid-2015. With its ratio at approximately 7%2, Spain stands only slightly above the euro area average, thanks to the reduction witnessed in the past two years.

On this occasion, I would therefore like to announce the following measures which we have instructed financial institutions to take, to further strengthen safeguards against financial scams. First, financial institutions are required to migrate from SMS One Time Passwords (OTP) to more secure forms of authentication for online activities or transactions relating to account opening, fund transfers and payments, as well as changes to personal information and account settings. The major banks have already started this process of migrating to more secure forms of authentication; Second, financial institutions will further tighten fraud detection rules and triggers for blocking suspected scam transactions. Customers will be immediately alerted when any such activity involving their banking accounts is detected. As an additional measure, financial institutions will block such transactions, and customers will be asked to confirm that such transactions are genuine before they are unblocked; Third, a cooling-off period will be observed for the first-time enrolment of online banking services or secure devices. During this time, no online banking activity is allowed to be conducted; Fourth, customers will be restricted to one mobile or secure device for the authentication of online banking transactions; and Fifth, financial institutions will be required to set up dedicated hotlines for customers to report financial scam incidents. Financial institutions have been directed to be more responsive to scam reports lodged by customers. Financial institutions have also been directed to facilitate efforts to recover and protect stolen funds, including to work with relevant agencies to prevent further losses.
In the spring of next year, when the next rise in the Ofgem cap on gas and electricity bills comes through, it will probably climb comfortably through 5%, a long way north of the MPC’s 2% target. Given the origins of this inflation – just about all the overshoot reflects unusually rapid rises in prices of tradable goods (including energy) – monetary policy could never have done anything about the consequences of the current inflation for real incomes. If global demand pushes up the price of something  8  Based on the Labour Force Survey, it is reasonable to assume that approximately 10% of those on the CJRS could be added to estimates of slack in the labour market. On that basis, the dots for 2020 and 2021 might be shifted to the right by 1.2 and 0.9 percentage points respectively. 14  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  14  we buy, and the price of our imports therefore goes up, that reduces real national income come what may9. Even assuming these shocks had been foreseeable, the only way to prevent the near-term consequences for inflation would have been to ensure that nominal wage growth was lower to at least the same extent. And because that, in turn, would have required much higher unemployment, real incomes would actually have been lower.

Lags, trade-offs and the challenges facing monetary policy Speech given by Ben Broadbent, Deputy Governor, Monetary Policy  Leeds University Business School 6 December 2021  I’ve received helpful comments from colleagues at the Bank of England. I’d like to thank Fabrizio Cadamagnani for his help in preparing the speech. The views expressed are my own and do not necessarily reflect those of the Bank of England or other members of the Financial Policy Committee or the Monetary Policy Committee. 1  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  Good morning! Thank you for asking me to speak to you today. It’s a great pleasure to do so in person, something I haven’t been able to do for almost two years. Virtual meetings are all very well – and were clearly indispensable during the worst of the pandemic – but I think there’s something missing if that’s the only way in which we ever talk to each other. It’s an additional pleasure to be in Leeds. As you may know, as part of a plan to increase our staff presence across the UK we announced earlier this year we’d be setting up a new hub right here in Leeds. I’m coming here at an extraordinary time for the economy in general and for monetary policy in particular. Annual CPI inflation rose to over 4% in October, with the jump in domestic energy bills the single most important contributor to the change on the month.
This is where money comes in and makes things easier for everyone; in that we agree what we will use as means of payment and store of value, Anna can give Pelle money for his work that represents the value of her harvest. The money is a representation of the work someone has done. 4 But for this to work, everyone must trust that it will be possible to buy what they want for the money, and that it must be easy and cheap to use money. This is where the central banks and other public authorities come in. The Riksbank’s role is to add efficiency and reliability for Swedish kronor and this is how we do it: • •  •  •  •  By ensuring that money retains its value. It is via monetary policy that the Riksbank holds inflation low and stable. By ensuring that one can rely on payments in Sweden. We need to know for certain when a payment has been finally executed, otherwise we would not be able to trade with one another. It is also possible that major risks could arise to the financial system if many participants had claims on one another. By supplying a payment system so that the banks manage their payments via the Riksbank we ensure that the payments are running smoothly. By ensuring that one can rely on the banking system where money is stored and created.

One question that many nevertheless ask in the light of today's relatively large balance sheets, is whether we should expect them to be large in the future. 44 There are many indications that this is the case. A short-term policy rate will always be an important monetary policy tool, but my assessment is that bond purchases will play a bigger role than before. As I said, the balance sheet is very large at present. This means that even if we wanted to reduce it rapidly, it would take a long time before it is back at the levels that applied prior to the global financial crisis 2008-2009. But there are also a number of economic reasons why the central banks’ balance sheets should be large going forward. 45  General low level of interest rates in Sweden and abroad If interest rates continue to be as low as now, the policy rate will hit the lower bound more often. Monetary policy will thus automatically become more dependent on other instruments to be able to affect interest rates and access to credit. Extensive asset purchases will thereby become a more important instrument, but other measures, such as forward guidance, and interventions on the foreign exchange market, could also become relevant. The Riksbank has already been using a form of forward guidance since 2007, in that we have published a policy rate path.
By the 1970s, policymakers realized that physical capital was not enough, and that health and education were equally important. By the 1980s, emphasis was placed on improving economic management and allowing greater functioning of market forces. By the 1990s, a three-fold strategy evolved: first,  4  BIS Review 88/2007  promoting labour-intensive growth through economic openness; second, intensive investment in infrastructure, and third, providing basic services to poor people in health and education through a solid welfare net. The model for 2000’s went further and took an even wider approach. In September 2000, 189 member states of the United Nations adopted the Millennium Development Goals. That declaration endorsed a strong commitment to the right to development, peace and security, gender equality, and the eradication of the many dimensions of poverty. It also mainstreamed a set of 8 inter-connected and mutually reinforcing development goals and 18 related targets into a global agenda. As of now, Sri Lanka has achieved some of the goals of the Millennium Declaration while others are being pursued quite diligently. The first goal is poverty eradication. For international comparison, the poverty line is set at US dollar 1 per day. As you know, the proportion of population whose income is less than the poverty threshold is known as the poverty head-count ratio. As measured by this indicator, as at 2002, about one fifth of the household population in Sri Lanka was living in poverty. Many efforts are now being taken to reduce this further.

According to the World Development Report of the United Nations, of the world’s 6 billion people, 2.8 billion (almost half) live on less than two dollars a day, and 1.2 billion (a fifth) live on less than a dollar a day. Also, the average income in the richest 20 countries is 37 times the average in the poorest 20, a gap that has doubled in the past 40 years. Hence, the distribution of global gains is extraordinarily unequal. Worldwide inequality persists even on the socio-human front. Although in general, human conditions have improved more in the past century than in the entirety of previous history, particularly in health and technological capabilities, several inequalities still exist. For example, in the poorest countries, only 4 out of 5 children live to celebrate their fifth birthdays, while in rich countries this ratio is over 99 per cent. While in rich countries fewer than 5 per cent of all children under five are malnourished, in poor countries as many as 50 per cent are. Hence, there is a huge imbalance and inequality in distribution of socio-economic gains as well. In this context, it is also heartening to note that strategies of reducing poverty have evolved over the past several decades in response to broadened understanding and rethinking of the complexity of development. As we are aware, in the 1950s and 60s, many economic and political planners viewed large investments in physical capital and infrastructure as the primary means of development.
The Bank, therefore, relies to a considerable extent on its established network of twelve Regional Agents who have the role of finding out from local businesses and firms their views on the state of the economy. The Agents maintain direct contact with around 7,000 businesses across the UK and provide a monthly report for each region to the MPC. Where there are particular concerns, the MPC also commissions the Agents to carry out inquiries on specific issues. Because of the time it takes for changes in interest rates to impact on inflation, it is perhaps too early to judge the success of these new arrangements. We could argue that we have made a reasonable start, given the period of sustained growth with low inflation and falling unemployment the UK has enjoyed since the new monetary framework was put in place. But a fairer measure of the MPC’s success is perhaps the fall in inflation expectations since May 1997 (which can be derived from prices of government bonds) which has brought the cost of long-term borrowing down to historically low rates. I think that this provides some measure of the growing credibility of the monetary policy framework; and the expectation that we have moved into an era where we can expect low and stable price conditions. Core purpose: financial stability I will say more later about the current position of the UK economy, but first I would like to say something about the other functions of the Bank which are perhaps less familiar than the MPC.

Further repo-rate cuts in April and July GDP continued to fall dramatically during the first quarter of the year, in Sweden as well as abroad, and the GDP forecast for 2009 was revised further downwards compared to the Riksbank’s assessment in February. The Riksbank also assessed that CPI inflation would fall very rapidly during 2009, which was largely due to the rapid interest rate cuts implemented at the end of 2008 and start of 2009. At the monetary policy meeting on 20 April, the repo rate was cut by 0.5 percentage points to 0.5 per cent. The repo rate was expected to remain at a low level until the beginning of 2011 (see Figure 1). In July, the assessment was that the decline in economic activity during 2009 would be slightly deeper than the assessment made by the Riksbank in April. The Riksbank’s assessment was that the repo rate and the repo-rate path needed to be even lower. The repo rate was cut by 0.25 percentage points to 0.25 per cent at the monetary policy meeting on 1 July. The repo rate was expected to remain at this low level until the autumn of 2010 (see Figure 1). The Riksbank also assessed that the cut did not represent a threat to the functioning of the financial markets. Furthermore, the Riksbank deemed that, following the cut to 0.25 per cent, the repo rate had in practice reached its lower bound.
First, in reporting my views to the committee, I noted my concern for the fragility of the U.S. economy and weak job creation. It might be noted by the press here today that although I am constantly preoccupied with price stability – in the aviary of central bankers, I am known as a “hawk” on inflation – I did not voice concern for the prospect of inflationary pressures in the foreseeable future. Indeed, the Dallas Fed’s trimmed mean analysis of the inflationary  BIS central bankers’ speeches  5  developments in June indicated that the trimmed mean PCE turned in its softest reading of the year. The trimmed mean analysis we do at the Dallas Fed focuses on the price movements of personal consumption expenditures. It is an analysis that tracks the price movements of 178 items that people actually buy, such as beer, haircuts, shoe repair, food and energy prices. In June, the trimmed mean came in at an annualized rate of 1.3 percent, versus 2.1 percent for the first five months of the year. The 12-month rate was 1.5 percent. My concern is not with immediate inflationary pressures. Core producer prices are still increasing at a higher than desirable rate.

Domestic banks are flush; they have on deposit at the 12 Federal Reserve banks some $ trillion in excess reserves, earning a mere 25 basis points – a quarter of 1 percent per annum – rather than earning significantly higher interest rates from making loans to operating businesses. These excess bank reserves are waiting on the sidelines to be lent to businesses. Nondepository financial firms – private equity funds and the like – have substantial amounts of investable cash at their disposal. U.S. corporations are sitting on an abundance of cash – some estimate excess working capital on publicly traded corporations’ books exceeds $ trillion – well above their working capital needs. Nonpublicly held businesses that are creditworthy have increasing access to bank credit at historically low nominal rates. I have said many times that through the initiatives we took to counter the crisis of 2008–09, and the dramatic extension of the balance sheet that ensued, the Fed has refilled the tanks needed to fuel economic expansion and domestic job creation.