samchain/econo-pairs-v1 huggingface dataset:
Tripathy et al, “Macroprudential Policy, Mortgage Cycles and Distributional Effects: Evidence from the UK” show that constrained banks issued fewer high LTI mortgages after the FPC’s policy was introduced. They also find evidence supporting the macroprudential benefits of the policy. The local areas with greater exposure to constrained lenders experienced smaller declines in house prices in the aftermath of the EU referendum in June 2016, when house prices fell across most UK regions. 15  11  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  11  The distinction between expectations effects and credit constraints matters in another way. To the extent that demand for housing is simply subdued by dampened household expectations about the future, there is no ‘loss’ to households. If however, demand for housing is held back by credit constraints, transactions which are desired are ‘lost’. One needs to be careful however about assuming that relaxation of credit constraints will lead to all otherwise ‘lost’ transactions taking place. The thought experiment I carried out earlier suggested that almost 10 million additional transactions would have occurred from 2007 to 2020 had transactions remained at their-pre financial crisis level. But this assumed that house prices remained at the actual levels we saw over the period. In the absence of increased supply, the evidence suggests that much of the additional demand would have fed into higher prices, raising indebtedness in the short term but eventually choking off the additional demand.

In a market with a sufficiently large share of such deep-pocketed arbitrageurs, it can be argued that the development of house prices relative to incomes can be largely accounted for by the substantial decline and then flattening out of the real risk-free interest rate over this period. Miles and Monro (2019) apply such a framework to demonstrate this. However – as I will go on to describe – this relationship does not fully explain house price moves over shorter time periods, which may be affected by credit conditions. 6  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  6  decisions (as housing is also an asset). In this literature, expectations of future income, future interest rates, and future house prices and can all play a role. There is some evidence that current interest rates and current house price growth have an important influence on expectations (Charts 4 and 5). All of these factors were likely at play during the pre-Covid decade. Chart 4: Momentum in annual asset price growth 1.0  Regression coefficient on lagged asset price inflation using annual data  0.8 0.65 0.6 0.33  0.4 0.2 0.0 House prices  FTSE all share  Sample uses annual data from 1971-2020 for house prices, from 1977-2020 for FTSE allshare.
Irma Rosenberg: Monetary policy and the Swedish economy Speech by Ms Irma Rosenberg, Deputy Governor of Sveriges Riksbank, to the Swedish Society of Financial Analysts, Stockholm, 5 March 2003. *  *  *  Thank you for the invitation to come here and speak at the Swedish Society of Financial Analysts. This is my first public appearance in my new role as Deputy Governor of the Riksbank. It is stimulating to meet people and discuss economic issues. At the same time, I feel a little nervous, as I know I am facing an audience who are used to examining and interpreting statements by the Riksbank. One difference between this post and my previous work is that a member of the Executive Board must to some extent exercise caution when speaking publicly. This is to avoid creating any misunderstandings among participants in the financial market, who try to translate statements by representatives of the central bank into future interest rate policy. This means that some of you may not be acquainted with me, but my aim is to be as honest and clear as I possibly can. What I intend to start talking about today is the development of the economy in recent years and to follow this with a look ahead at the challenges facing both the Swedish and international economic climates, and finally say something about monetary policy. Those of you who are familiar with the economic assessments I have made know that I sometimes have not shared the Riksbank’s conclusions.

Our ambition will then be to make it clear that we have done so. By raising and lowering the steering interest rate - the repo rate - the Riksbank attempts to influence inflation. As it is so difficult to steer inflation in the short term, the Riksbank makes an assessment of developments for the coming 1-2 years. This is the period of time usually assumed necessary for an interest rate adjustment to work its way through the economy and have a full impact on the rate of price increase, i.e. inflation. The Riksbank uses a simple rule-of-thumb when shaping its monetary policy. If the total picture of inflation shows that it is expected to be above or below the target level, the steering interest rate is adjusted accordingly. There are four main factors in the analysis of future inflation that stand out as central to the shaping of monetary policy: the development of total resource utilisation, international price trends, the exchange rate and the general public’s inflation expectations. Inflationary pressure varies according to the demand situation and to changes in resource utilisation. The stronger the upturn in demand in relation to potential production, the greater the risk that prices and wages will rise rapidly and vice versa. This is why we who work in central banks around the world  BIS Review 12/2003  1  must analyse the picture of economic activity as a whole, despite the fact that inflation is our target variable.
We also need to ensure the harmonised application of banking regulations in all Banking Union countries, and avoid the risk of fragmentation, which would reduce the expected benefits of a union. It is also vital to strengthen the integration of European financial markets. The action plan for the Capital Markets Union, launched by the Commission in 2015, has allowed a few advances to be made, with the creation of European cross-border funds and a pan-European retirement savings product. We must go even further on this, and create a genuine Financing Union for Investment and Innovation, that would better channel Europe’s savings surplus (3% of GDP) towards productive investment, by shoring up companies’ capital and increasing their ability to develop and innovate. For this, we need to (i) facilitate cross-border investment by harmonising accounting, tax and bankruptcy rules; (ii) develop incentives for equity financing; (iii) develop European securities and savings products (venture capital funds, green bonds, securitised portfolios, etc.) aimed at providing long-term, diversified financing to Member States. Finally, with its strong international commitment on climate issues, Europe must play its full role in initiatives to tackle the risks linked to climate change. The Banque de France was one of the founders of the NGFS or Network for the Greening of the Financial System, and provides secretariat services for the platform which now has 42 members and 8 observers, representing 5 continents.

Philipp Hildebrand: Principles for sound compensation practices Summary of a speech by Mr Philipp Hildebrand, Vice-Chairman of the Governing Board of the Swiss National Bank, at the Economic Outlook 2009 (Unternehmer NW-Schweiz), Basel, 23 April 2009. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch). *  *  *  Most financial institutions viewed compensation systems as being largely unrelated to risk management and risk governance prior to the crisis. Short-term profits were rewarded with generous bonuses with little regard to the longer-term risks taken on behalf of the firm to generate those profits. With hindsight, it should therefore be no surprise that these bonuses fueled the excessive risk-taking that has ultimately undermined the global financial system. It is important for the future stability of our financial system that compensation systems be viewed as an integral part of the risk management system in financial firms, and designed and governed with this in mind. The Financial Stability Board (previously the Financial Stability Forum) has drafted a set of sound compensation principles for large financial institutions with exactly this goal in mind. The Principles were endorsed by the G20 leaders at the London summit earlier this month and aim to be widely implemented by the 2009 remuneration round. BIS Review 50/2009  1
These are summarized in the Report’s box V.1. Also, this time around, we have attached to the Report a supplement describing a body of background information on the determinants of and perspectives for Chile’s trend growth over the next 30 years. I will come back to the contents of this document in a few minutes. Our estimates suggest that Chile's trend GDP growth over the next ten years is in the range of 3% to 3.5%, quite comparable to our estimates a year ago. This range implies, among other things, that investment again grows in line with GDP; that the productivity of sectors other than natural resources grows near its average of the last 20 years; and that immigration and increasing female participation partially offset the effects of the aging population on the labor force. With regard to potential growth, at the shortest terms, investment and productivity show below-trend growth rates, so potential growth is lower than trend. Thus, potential GDP growth is now estimated to be around 2.5%, compared to the 2.5% to 3.0% we estimated in September 2016. With this, the current activity gap is somewhat narrower than previously estimated, even considering that the evolution of GDP has also been somewhat lower (figure 9). For the purposes of monetary policy, the evolution of the activity gap is still consistent with an economy needing an important monetary impulse throughout the 4  projection horizon. In addition, the Board continues to estimate the neutral interest rate to be between 1% and 1.5% in real terms.

Merchants and consumers With increased transparency in payment services brought about by the various regulatory and industry measures, merchants and consumers alike should leverage on expanded information disclosure to get the best deals that suit their requirements. A smart consumer will drive competition and reduce costs over the long run Processing payments and account reconciliation manually is a tedious affair and a source of much inefficiency. Merchants in particular should leverage on e-payments as a means to rationalize their business processes to be more efficient, so that more resources can be directed towards growing their business. Merchants should also leverage on the latest payments technology such as the mobile point-of-sale (mPOS) which allows them to leverage on smart devices to accept payment cards on-the-go. Consumers on the other hand, should also embrace e-payments to be more efficient and safe by taking advantage of the various incentives provided by the banking industry. Opportunities and key priorities for 2016 We have now reached a critical juncture in our migration to e-payments. With the enabling environment in place and the encouraging progress recorded for the past five years, emphasis should now be devoted towards implementation and facilitating behavioural change among individuals and businesses. We must use as beacon the targets set out in the Financial Sector Blueprint. The achievement of such targets would put us on par with other advanced countries and become as competitive as we transition into a high value added and high income economy.
They may also, however, reduce market discipline and increase the overall scale of leverage assumed by those funds. We don’t have the capacity to assess with confidence the balance of these effects on the probability of crisis and the severity of market dynamics in conditions of stress. What should be the focus of supervisory efforts in this new context? Clearly, capital supervision and market discipline remain the key tools for limiting systemic risk. The emergence of new market participants such as leverage institutions does not change that. I am going focus on three broad policy priorities - risk management, capital and margining practices, and the financial infrastructure. Risk management We should focus more attention on parts of the risk-management process where uncertainty is greatest and materiality of the risks that we can’t readily quantify is highest. This means more attention on the risk factors where the measurement challenges are most complex. It means more attention on assessing potential exposure in extreme events that lie outside past experience, not just those outside of the recent past. These challenges require using a mix of different analytical tools to help illustrate the range of possible outcomes and the dimensions of uncertainty that apply to the measurement of exposure. The focus should be not on the specific estimates produced for various types of asset price movements or stress events, but the uncertainty that surrounds those estimates and the magnitude of the potential underestimation of losses.

In my view, these should remain the priorities of economic policy if we intend the incipient recovery in our economy to strengthen and be sustainable over time. Thank you. 4  BIS central bankers’ speeches
A strong takaful market in Malaysia, supported by the experience and expertise of several niche players in retakaful operation during the last two decades, would provide a strong base for a global retakaful operation to flourish. Under this initiative, qualified local and foreign applicants will be allowed to conduct both Malaysian and international currencies retakaful business. Flexibility is accorded to the retakaful operators to conduct its retakaful business in Malaysia by way of an incorporated either entity or a branch. Foreign applicants are also welcomed to conduct retakaful business in Malaysia through a joint-venture with Malaysian companies. It is anticipated that this measure would serve as a catalyst in our efforts for Malaysia to become the centre for takaful and retakaful business through the establishment of a significant number of strong and reputable retakaful operators. For the potential investors in these ventures, I wish to highlight that Malaysia maintains a liberal foreign exchange administration regime where investors are freely able to obtain ringgit and foreign currencies to fund their investments in Malaysia. Please do forget the foreign exchange administration rules introduced during the 1997/1998 Asian financial crisis. BIS Review 129/2007  3  We have even further relaxed the foreign exchange administration rules to allow resident and foreign issuers to raise foreign currency-denominated bonds, including Islamic bonds or sukuks.

As affirmed by the Governing Council at its last monetary policy meeting on 7 September, we expect the key ECB interest rates to remain at present levels for an extended period of time, and well past the horizon of the net asset purchases. Our asset purchase programme (APP), at the current monthly pace of € billion, is intended to run until the end of December this year, or beyond, if necessary, and in any case until the Governing Council sees a sustained adjustment in the path of inflation consistent with its inflation aim. The net purchases are made alongside reinvestments of the principal payments from maturing securities purchased under the APP. Later this year we will decide on the calibration of our policy instruments beyond the end of 2017, taking into account the expected path of inflation and the financial conditions needed for a sustained return of inflation rates towards our objective. 1/3  BIS central bankers' speeches  The ECB’s monetary policy measures and the favourable effects they are having on borrowing conditions for firms and households, access to financing and credit flows across the euro area are supporting domestic demand and are also facilitating the deleveraging process. In order to reap the full benefits of our monetary policy measures, actions in other economic policy areas remain necessary to strengthen long-term growth and resilience in the euro area. Meanwhile, the condition and resilience of the euro area banking sector has continued to improve.
To this end, the SNB is investing very substantial resources to contributing actively to international regulatory reform projects, especially within the FSB and the Basel Committee. Indeed, a main raison d’être of these international bodies is to ensure a level playing field. We must accept, however, that not all countries are confronted with the same urgency for reform as we are in Switzerland. As I have already explained to you this evening, given the size and importance of our banking sector, our country is particularly vulnerable to a financial shock. Agreeing on an international common denominator of regulatory reform may turn out to be insufficient for the Swiss case. Ultimately, it will be a political decision to choose the level of risk Switzerland is willing to accept, both for the financial and for the real sector. Given the particular situation in Switzerland, higher-than-average regulatory standards are warranted. Conclusion The worst of the crisis is behind us, and intensive efforts are underway to increase the resilience of the financial system. Banks are again generating profits. In some cases, these profits are very substantial and are clearly linked to the public support measures, many of which are still in place. As the situation improves, complacency can easily become the rule of the game. We will forget the severity of the crisis and fall prey to lobbying by a powerful and recovering financial industry. Ladies and gentlemen, we must not let this happen. The stakes are simply too high.

Lord Mayor, as we prepare to toast the Bankers and Merchants of the City of London, we remember that the City is more than banking and that banking is much more than the trading of complex securities. So all of us here tonight would like to pay tribute to your work since you became Lord Mayor, to support your efforts to promote financial literacy, and to thank both the Lady Mayoress and yourself for the splendid hospitality which you have extended to us all this evening. So I invite you all to rise and join me in the traditional toast of good health and prosperity to "The Lord Mayor and the Lady Mayoress", Ian and Lin Luder. 4  BIS Review 76/2009
I wish you a very fruitful conference. 2  BIS central bankers’ speeches

A number of actions have already been completed to enable the targets, currently being consulted on by the FSB, to be met.11 The importance of progress in this area was highlighted in the recent G7 Communique.12 The improvements we are making to RTGS, will help us to deliver key elements of the FSB roadmap. Key elements include the implementation of APIs, the capability to extend operating hours, synchronisation and our first key milestone of the implementation of the emerging global standard for financial messaging in payments ISO 20022. Future proofing the payments infrastructure Innovation is crucial to the future payments landscape. It is not a single act: it needs to be continuous. We are building a renewed RTGS service as a modular flexible platform so we can introduce new features in an agile flexible way with less cost and less risk, to enable us to respond more quickly to market changes and continued innovation in payment technologies. We 5/6  BIS central bankers' speeches  already plan further enhancements following the replacement of the new our core ledger in September 2023. This will include the ability to connect via multiple message networks, additional APIs, consideration of extended operating hours and synchronisation functionality. It will also include improved contingency functionality to enhance resilience. These ideas have been developed in conjunction with industry, and we will be consulting later this year to help to prioritise the enhancements. I encourage you to actively participate in this consultation and to help shape the next phase.
Another reason that our new objective should not encourage risky bets on regulatory standards is that we all remember what happens when such bets backfire. Over the last thirty years we saw the spectacular unravelling of the Bank of Credit and Commerce International, a subsequent small banks crisis, the equally spectacular collapse of Barings, and problems in the insurance sector including the closure of Equitable Life. And that was before we even got to the historic crisis of  Page 6  2007-08. In case anyone has forgotten, government support to the financial system peaked then at almost £ trillion. [15] The economic damage was immense and enduring. [16] Good prudential regulation – like a good immune system – remembers previous crises so that it can tackle similar ones when they come along in future. But to reiterate, strong regulation also needs to be responsive to the needs of the UK and to accommodate beneficial innovation. While I do not believe there is a fundamental tension between strong regulation and competitiveness for a global financial centre like the UK, it’s obvious that stronger and ever stronger is not the right answer. The PRA will not be turning the dial up to eleven. We will turn the dial down when we can. This is what we are doing as we go through the hard and unglamorous work of considering our detailed prudential rules to tailor them to the circumstances of the UK.

That would be an argument for keeping the programme in place while recognising that it may not be employed unless unusual circumstances appear. 2  BIS central bankers’ speeches  Q. How would you evaluate the programme. Has it been a success? The programme has been a success. One has to ask what is the counterfactual for what would have happened in the euro area had the programme not been in place. In the dramatic situation that we were facing in May 2010, the damage that could have resulted from the absence of this programme could have been quite severe. Q. Is the transmission mechanism working now? Speaking for myself, I have less concern for the transmission of monetary policy today than in May 2010 when it was introduced. Q. Could Portugal government bonds be extended similar treatment as Greece and Ireland regarding collateral use in ECB operations? Regarding the eligibility of collateral, as a rule we rely on the rating agencies, but in those circumstances when we can make an independent evaluation of the country we don’t need to rely on the rating agencies. This has happened in the case of Greece, this is what has happened in the case of Ireland and I trust that if it becomes necessary to have an independent evaluation in order to assess the eligibility of collateral of any other sovereign in the euro area, then this will be done as well. Q.