samchain/econo-pairs-v1 huggingface dataset:
Central Bank’s FX Interventions and FX Auctions (Million US dollar)  Year  FX Buying Auctions FX Selling Auctions  FX Buying  FX Selling  Total Net FX  Interventions  Interventions  Purchases  2003  5652  -  4229  -  9881  2004  4104  -  1283  9  5378  2005  7442  -  14565  -  22007  2006  4296  1  5441  2105  6632  2007  9906  -  -  -  9906  2008  7584  100  -  -  7484  2009  4314  900  -  -  3414  2010*  3376  -  -  -  3376  *As of 15 April 2010. Source: CBRT. Esteemed Guests, 50. In sum, the developments since the last quarter of 2008 demonstrated that inflation targeting is a flexible strategy that enables a timely response to economic shocks. Recent experiences have clearly confirmed that the Central Bank, when necessary, can focus on sudden slumps in growth and employment driven by external factors provided that this does not conflict with its objective of price stability. In the upcoming periods, we will continue to focus on establishing price stability permanently, acting in the light of our past experience and with the awareness of our increased credibility.

At this point, I would like to emphasize that we closely monitor pricing behavior as inflation hovers around high levels, albeit for a temporary period. I would like to hereby remind you that we will provide public with the updated evaluations and forecasts on medium-term inflation outlook along with possible risks and policy measures, more extensively in the Inflation Report to be published on 29 April. BIS Review 68/2010  13  Distinguished Guests, 37. Throughout 2009, as the Central Bank, we focused on policies oriented towards containing the adverse effects of the crisis on the economic activity and on financial stability while also overseeing price stability. Thanks to the experience gained from domestic crises in the recent past, we were able to make prompt and effective decisions, thus we were able to do our part to minimize the adverse impacts of the global crisis. In this period, the soundness of the financial system in addition to the relatively limited deterioration in the risk premium provided monetary policy with an extra room for maneuver. 38. Accordingly, envisioning that undershooting the inflation target at year-end has been more likely, we continued the rate cut cycle that we initiated in November 2008 by pursuing a front-loaded monetary policy in early 2009.
A more integrated capital market would provide deeper, more liquid equity markets in which a wide range of corporates could issue equity and risks could be shared more widely. More broadly, areas where reforms could improve borrowers access to market-based financing could include: public platforms, such as, “mini-bond” markets for SMEs, which have enjoyed some success in Italy in particular; pan-European private placement markets which channel funds directly from non-bank investors, such as, insurers and pension funds to mainly medium-sized companies (currently only Germany and France have private placement markets of any notable size) and encouraging the emergence of simple, transparent and robust securitisation markets. 1 Increasing the scale of cross border capital flows across Europe brings benefits. But it is not without risks. One does not have to go back to where I started today – in the late 1950s – to find examples of the power of cross border flows to amplify crises when it all goes wrong. That is why they have to be built on the foundation of sustainable economic policies, good regulation and robust institutional structures. The nature of capital flows matters too. Europe was not short of cross border flows before the crisis. But they were concentrated in interbank lending and in debt often held by highly leveraged investors. Inter-bank lending can of course be a very dangerous way to share risks between economies, particularly if the banking system is highly leveraged.

We have made great progress towards ending “too big to fail” and towards ensuring that the risks taken by financial sector firms are truly borne by their shareholders and creditors and not by taxpayers. The EU and international reforms in progress mean that financial firms are much less likely to fail and, if and when they do, the real economy is much less likely to suffer the collapse of the critical economic functions that the financial system provides. We need EU rules to enable and support the single market in financial services. And, though they are not as effective as a framework for open capital markets because they do not have force of law, we need global prudential standards properly and consistently applied to support a global capital market. We need the rules and standards and cooperation between regulators to prevent adverse spillovers between countries and to manage them if they occur. But we should be clear that while we have reduced the risks and consequences, were we to see a major system wide shock that led to a systemic crisis, it is only governments and national authorities that can ultimately provide the confidence to ensure there is not systemic failure. In the EU context, it is worth noting that there is only a fleeting reference in the Treaties to financial stability; it is the references and powers relating to the single market that have been the basis for the EU rules on prudential regulation. To be clear.
The Grand Unifying Theory (and practice) of Macroprudential Policy Speech given by Mark Carney Governor of the Bank of England  Logan Hall, University College London 5 March 2020  I would like to thank Daisy McGregor, Nicola Anderson, David Aikman, Caspar Siegart and Victoria Monro for assistance in preparing these remarks and Wayne Chapman, Kate Stratford, Jon Bridges, Matt Waldron and Alina Barnett for their research and analysis. 1  All speeches are available online at www.bankofengland.co.uk/news/speeches  I. Introduction  Economists suffer from physics envy. We covet its neat equations and crave its deterministic systems. This inevitably leads to disappointment. The economy isn’t deterministic. People aren’t always rational. Human creativity, frailty, exuberance and pessimism all contribute to economic and financial cycles. As the great physicist, Sir Isaac Newton, lamented, “I can calculate the motions of celestial bodies, but not the madness of people.” Newton’s exasperation came after he had lost a fortune investing in the South Sea company, or, with the wisdom of hindsight - after he had speculated on a bubble. Just as people can go from rational to “mad” in a boom, theoretical physics itself isn’t quite as neat as Newton had thought, for it has been discovered that Newtonian mechanics break down at the subatomic level. But physicists are not easily daunted. Their hottest fields, such as String Theory, are part of a quest for a theory that unifies Newton and the neutron—a Grand Unifying Theory of Everything that Matters.

But if – as I expect is a risk – we are set to need more nuanced monetary policy actions in the future as the macroeconomic situation normalises and decisions become more finally balanced, then re-establishing a reputation for measured and purposeful steps in policy is valuable. Restricting ourselves to a 25bp now – albeit with the prospect of more to come in the coming months – is an investment in containing market expectations of aggressive ‘activism’ that I saw as worth making. In the early years of the MPC, former Bank Governor (then Deputy Governor and now Lord) King argued that the establishment of the inflation target should mark the end of characterising policymakers as either ‘hawks’ or ‘doves’: “it made no sense to use these descriptions because each member of the Committee had the same objective”.27 An alternative distinction could emerge along the dimension of how ‘activist’ policymakers were in pursuit of their common target: whether they would use policy aggressively to return inflation to target quickly, or take a more measured approach reflecting the potential for difficult trade-offs between inflation and output volatility created by some shocks. Given the data and structural uncertainties facing monetary policy that I have discussed in this talk, a case can be made for a measured rather than activist approach to policy decisions, with a focus on more persistent developments in the data that have lasting implications for the outlook for price stability. That is what I would label a ‘steady handed’ approach to monetary policy.
Inflation Per cent  6  6 Goods and services produced in Norway  4 2  4 2  Underlying inflation  0  0 -2  -2  Imported consumer goods  -4  -4  -6 1999  -6 2000  2001  2002  2003  2004  Sources: Statistics Norway and Norges Bank  Consumer price inflation in Norway declined sharply through 2003. A number of factors appear to have contributed to the decline. The appreciation of the krone through 2002 pushed down import price inflation. Chart 17. Price indicator for imported consumer goods Foreign currency. Percentage rise  3  3  2  2  1  1  0  0  -1  -1  -2  -2  -3 1992  -3 1994  1996  1998  2000  2002 2003  Source: Norges Bank  12  BIS Review 11/2004  A change in trade patterns and external economic conditions have resulted in an unexpectedly sharp fall in import prices, even when measured in terms of what Norwegian importers pay in foreign currency. Chart 18. Price indicator for imported consumer goods Foreign currency. Index.

Several entities have been charged in court and some of these had been convicted. While we will sustain these efforts to continue to raise standards of compliance in the industry, the primary responsibility for ensuring compliance rests with the industry itself. It starts with every company having clear processes, well-trained and informed staff, and effective systems and records that assist in complying with regulatory requirements. The industry has made some progress, and we are encouraged by the efforts that are being made at individual companies and at the industry level. Some of you have made more progress than others. For those that continue to wait, time is running out and it is very important that plans be developed immediately and implemented aggressively to establish the necessary systems to improve compliance with the law. Overall, while the industry has done a commendable job, a lot more can be accomplished and it is in the industry’s interest to show improvements, as we enter into the next round of compliance assessment of individual companies. Expectations on MAMSB We have high hopes and expectations for the association. The establishment of this association is very timely for it to play a central role for the benefit of the industry. The Association should spearhead and drive capacity building efforts that will support the objectives of promoting modernisation and elevating the standards of compliance and professionalism in the industry. Firstly, the association is expected to take on an important role in instilling professional conduct and good business practices amongst the industry players.
As its influence on the economy is subject to a time-lag, monetary policy has to be conducted in a forward-looking manner. Consequently, forecasts play a decisive role in analyses and decision-making. At the same time, the exchange rate, like other prices set on financial markets, is very difficult to forecast.11 Nevertheless, due to its significance for the development of small, open economies such as Sweden’s, it is important to form an understanding of exchange rate developments. The Riksbank tries to analyse and forecast the development of the trade-weighted exchange rate, which is to say the value of the Swedish krona against a basket of the currencies of Sweden’s most important trading partners. Due to the volatile nature of the exchange rate, no attempts are made to capture short-term variations in it. Instead, the focus lies on the more long-term trend. The starting point for this a statistical model in which the real exchange rate is related to relative GDP, the terms of trade and net foreign assets.12 However, the final forecast for the exchange rate considers the fact that the exchange rate both influences and is influenced by a multitude of other variables, including the interest rate differential in relation to other countries.13  10  See, for example, Ekholm et al. (2008). Pressure on firms to improve productivity can be seen as a positive aspect of a strong real exchange rate. A weak real exchange rate is otherwise frequently seen as being advantageous for a country as it benefits its exporting firms.

Partially, this is because price changes are intrinsically costly,5 but also because firms often wish to maintain customer goodwill by not immediately passing increased costs along. Furthermore, many firms hedge their foreign trade on the foreign exchange forward market so as not to be affected by short-term exchange rate fluctuations.6 This very time horizon is an important aspect of exchange rate fluctuations. If the change is deemed to be temporary, it is reasonable to assume that many firms will avoid changing their prices and that the pass-through will thus be moderate. If, on the other hand, it is deemed to be permanent, the pass-through should be greater, as otherwise margins will be lower (in the event of a depreciation of the krona). Another important aspect here is the competitive situation on the market. On a market characterised by strong competition, it will be more difficult for a firm to increase prices without losing sales. The general demand situation can also play a part. It will probably be easier to raise prices in a period of high economic activity, when many domestic competitors will also have a tendency to increase their prices, than in periods in which domestic demand is developing weakly. Empirical studies suggest that, for example, a weakening of the exchange rate by 4 per cent will increase import prices by about 2 per cent, which is to say that the pass-through is about  3  See Hansson and Lindberg (1994) for a description.
This new role for the Commission, in liaison with the ECB, was initially assigned under contractual arrangements, first for bilateral loans from Member States to Greece, and later for loans from the EFSF to a number of Member States. This role was later formalised in the case of loans from the ESM under the Treaty Establishing the European Stability Mechanism (the ESM Treaty), an intergovernmental treaty concluded by the euro area countries under public international law outside of the Union legal framework. [46] The role allocated under the ESM Treaty to the Commission, in liaison with the ECB, was confirmed by the CJEU in Pringle v Ireland[47] as being in line with the case-law of the Court, whereby Member States are entitled, in areas which do not fall under the exclusive competence of the Union, to entrust tasks to Union institutions, outside the framework of the Union, such as the task of coordinating a collective action undertaken by the Member States or managing financial assistance, provided that those tasks do not alter the essential character of the powers conferred on those institutions by the Treaties. In this respect, the Court held that the duties conferred on the Commission and ECB under the ESM Treaty, important as they are, do not entail any power to make decisions of their own. Further, the MoU negotiated by the Commission, in liaison with the ECB, with the Member State concerned is signed by the Commission on behalf of the ESM and, therefore, solely commits the ESM and the Member State.

[2] To maintain the claim of a negative relationship between inflation and central bank independence in the more recent period (in which central banks in advanced economies have not been struggling with high inflation, but rather with inflation being too low for too long) requires a more nuanced approach, as some commentators have stressed. [3] According to them, a consistently negative relationship between inflation and independence across time and countries remains intact if one considers a narrower measure of independence which captures the autonomy of the central bank in its selection and use of monetary instruments, in line with the core monetary policy function of the central bank (instrument independence). By contrast, the significance of broader measures of independence has been reduced in a period in which central banks have had to take on new tasks. At a conceptual level, the benefits arising from central bank independence in terms of price stability have been strongly echoed in the literature on rules versus discretion. [4] This literature points out that decision-makers who are subject to political election cycles tend to act in a more short-sighted manner when exercising their mandate. This short-termism creates an inflation bias, making it difficult to credibly promise actions which will validate low inflation expectations over time. To overcome this time-inconsistency problem, monetary policy needs to be delegated to an institution which is sufficiently detached from these cycles.
In total, more than 51 billion coins had been minted and around 16 billion banknotes printed at the end of 2001. The second phase of the operation involved putting the new currency into circulation and withdrawing national banknotes and coins, an operation that impacted the 300 million inhabitants of the euro area and many more outside it. Things worked out well because of good preparation: advance planning, communication, co-ordination and thorough follow-up and control have all been vital. It is worth mentioning the success of the slogan “the euro. Our money”, which reached a worldwide audience through television and newspaper advertisements, web pages, starter kits, and the 200 million leaflets written in a total of 38 official European languages, regional languages of European countries and other world languages. On 1st January 2002, the reception of the new currency was surrounded with confidence and, even, an element of enthusiasm across the euro area. The mandate of the ECB The citizens of the euro area received the new currency with a sense of confidence. But since the euro was not created in an institutional vacuum, it is important to recall which factors have enabled us to make the euro a credible currency which was immediately adopted. I would name here, most importantly, the institutional framework of Economic and Monetary Union. The Maastricht Treaty has written in stone that monetary policy is to be conducted with the aim of maintaining price stability and that the ECB is fully independent.

While the regulatory and legal barriers have proved to be thorny issues, I expect that the Commission, as part of its capital markets union (CMU) action plan, will not be dissuaded from its efforts.2  Integration of securities issuance With T2S, the Eurosystem has created the basis for an efficient and effective settlement 1/3  BIS central bankers' speeches  mechanism for securities in Europe. At the same time, by adopting the CSD Regulation (CSDR), the Commission has contributed to further harmonisation of the CSDs’ regulatory framework. However, to be able to reap the benefits of these efforts, market participants and corporates need to have full and direct access to the entire EU securities market at a low and harmonised cost. A European securities market should offer the possibility of issuing, settling and holding securities in the same way, regardless of where issuers and investors are located. A fully harmonised system of securities issuance could reduce the transaction costs for capital financing, make the European securities market more attractive in the global economy, and allow an effective redistribution of private risk across the EU markets. A sound and uniform panEuropean securities issuance mechanism would also be conducive to the creation of the CMU. Despite efforts to overcome the fragmentation of the securities market by providing a level playing field, there is still too little evidence of competition. The effects of competition have not been felt in terms of an actual geographical widening of services provided by the vast majority of issuers.
This assessment is particularly relevant as evidence is increasing that the entrenched uncertainties in recent years may have weighed more heavily on supply growth than previously anticipated. IV. Some Lessons for Inflation Targeting While there will always be healthy debates about monetary policy tactics, the UK’s most recent recovery provides some important lessons about the effectiveness of the UK’s Inflation Targeting framework. First, the flexibility inherent in inflation targeting is highly valuable, particularly when combined with mechanisms to improve transparency and accountability. In the wake of the referendum, the MPC’s aggressive monetary easing, despite a sharply depreciating currency and rising inflation, was made much more effective by the new requirements under its remit to explain clearly the trade-off it was pursuing between supporting jobs and growth on the one hand and returning inflation sustainably to target on the other. The post-Referendum experience was exceptional, not least because it was the product of a delayed real shock to the economy to which households, businesses and financial markets participants responded at different speeds and to different degrees. But this issue of a trade-off is not unique. As has become apparent since the financial crisis, the UK economy is subject to unusually large and protracted exchange rate pass through that can be relevant at the monetary policy horizon. The MPC needs to understand the reasons for such moves, decide whether to employ the flexibility in the inflation targeting framework to look through them, and then explain clearly the rationale for its actions.

6 Opening Remarks at Reforming Culture and Behavior in the Financial Services Industry: Expanding the  Dialogue, William C. Dudley, October 20, 2016. 7 The Role of Best Practices in Supporting Market Integrity and Effectiveness, Simon Potter, Remarks at the  2016 Primary Dealers Meeting, September 7, 2016. 2/3  BIS central bankers' speeches  3/3  BIS central bankers' speeches