samchain/econo-pairs-v1 huggingface dataset:
All the theories of the ruble exchange rate pegged to a certain ruble price of oil originated from considerations of budget balance and concerns that the central bank would intentionally generate inflation to finance budget liabilities. That is the Bank of Russia was suspected of being ready to give up inflation targeting for the sake of budget replenishment. It took us many months to persuade the market of the opposite. Does Russia have a potential to build up government debt? Yes, it does, in theory, since our country may boast one of the lowest levels of government debt. Consequently, the development of the government debt market could be conducive to the development of the financial system as a whole. Anyway I would proceed from the conservative assessments of the maximum possible debt burden on the Russian economy, which does not pose a threat to macroeconomic stability, say, no more than 25–30% of GDP. Anyway examples from the Russian history show that the real interest rates the Russian budget has to pay, should the government debt exceed 35–40%, became exorbitant and accelerated the debt spiral. Among the negative outcome of government debt growth I may also call the ousting of corporate and private borrowers by the state. By the way, the maximum permissible debt burden is higher in the countries witnessing persistently low inflation and persistently low inflation expectations. The long-term real interest rates in these countries are lower, which means that debt burden limits are higher.

Risks related to the corporate debt burden are under control. The Bank of Russia is monitoring financial stability, promptly and regularly adjusts its macroeconomic forecasts and its policy. The central bank is prepared to use all available instruments to stabilise the situation in case of need. However, in order to maintain macroeconomic stability we need not only a balanced policy pursued by the central bank, but also the appropriate fiscal policy, including the government debt management policy. The national debt in national currency is a basic financial instrument for any country of the world. It plays a leading part in the financial markets, is actively used by central banks in their monetary policies, as well as in banking and financial regulation. This is the role of a risk-free liquid asset, as we conditionally call it. The rates on other riskier assets are usually calculated with due account of the risk premium to government debt. As distinct from short-term interest rates regulated by central banks, long-term rates in the economy depend on inflation expectations and expectations with regard to government finance sustainability. The ‘risk-free’ is a key word describing the relationship between the financial system and the government debt. The latter may perform all these functions only if the state budget is balanced in the medium and long terms and the government may honour its obligations without resorting to defaults and the printing press. Budget discipline impacts the central bank’s ability to function as an economic and financial stabiliser amid economic shocks.
First, given the unpredictable and dynamic nature of the financial market, there is urgency for us to keep our fingers on the pulse of the market and have access to real time information. 2  BIS central bankers’ speeches  There is much scope for cooperation between the central bank and industry players in this area. In addition to being familiar and observance of the rules and regulations of the financial market, we expect market participants to know the details of their clients’ transactions to aid us in understanding the nature of the market conditions. Everyone has an important role to play in maintaining the stability of the market and remain vigilant on all financial market activities. This is necessary to prevent activities that could threaten financial stability and create unnecessary volatility, or incidents that could damage the integrity of our domestic financial market. Secondly, while I’m on the topic of enhancement of market stability and integrity, I should stress on the importance of upholding individual ethics and professional conduct. The market is made up of individuals including institutions. The glue that binds individuals and institutions that constitute the market is TRUST. A case in point, on rate rigging, several global banks paid hefty fines to regulatory authorities because of individuals rogue traders. Many dealers were convicted of wrong doings, and investors are still taking lawsuits against the banks. TRUST was violated. While no Malaysian dealers were caught red handed in market misconduct, we should not be complacent.

Given the strong data, this is not what and how a developed market should behave as there is ample FX market liquidity. If we look at the recent daily volume of FX trade, although lower than last year, it was still double the amount 5 years ago, between USD5-6 billion for the USD/MYR pair and between USD8-10 billion for all other currency pairs. What we need to do now is to remind ourselves and each other constantly that we need to put things in proper perspective. As a group, we constitute the market and individuals, we should behave responsibly. BIS central bankers’ speeches  1  On the other hand, despite the adverse market conditions, we noted that the Malaysian bond market has been holding up quite well despite lower level of liquidity, thanks to domestic institutional players’ support. Nevertheless, we also realized that significant foreign participation in our financial market can be both a boon and a bane for the industry. While high foreign participation has led to better liquidity and lower cost as what we have experienced in the past, it has also brought risks and vulnerabilities. The percentage of nonresident holdings itself has evolved into a risk indicator, regularly quoted by market commentators, where 48% is the number frequently quoted as the percentage of nonresident government security holdings. There was also the argument that large holdings by non-residents might leads to sell offs during period uncertainty, thus causing financial market instability. This is erroneous and misleading.
We acknowledge that this can make our strategy more difficult to understand, especially at the outset. Sometimes the strategy is accused of lacking clarity on the grounds that the two-pillar approach is rather complicated and therefore unclear. However, alternative strategies would only achieve clarity in a superficial sense. Rather than being simple, they may actually be simplistic - and therefore misleading. Drawing together these arguments, let me emphasise that a monetary policy strategy should not be seen as a machine that mechanically delivers policy decisions. There must be room for a diversity of views, for deliberation and for judgement in the Governing Council’s discussion. Monetary BIS Review 44/2000  4  policymaking cannot be reduced to a reaction to a single figure, be it monetary growth or an inflation projection taken from a model or a group of experts. Nor can monetary policy be formulated on the basis of a single chart, however colourful. The ECB’s strategy provides scope for extensive debate and the exercise of informed judgement, both of which are essential to policymaking. Taking an eclectic, more diversified approach to inform policy judgements - as is implicit in the two-pillar approach - is likely to lead to a better understanding of the economy, to produce better policy advice, allow better policy discussions and therefore reduce the risk of policy errors. This robust approach to monetary policymaking is at the heart of the ECB’s strategy.

The Taiwan Semiconductor Manufacturing Company, a major producer, said last week that its own production had risen 30% in the first half of 2021, relative to the same period a year earlier, and that it expects full year growth of 60% (in response to what have been much milder price rises I think this counts as relatively “elastic” supply). The Chief Executive of the company said “we expect the shortage to be greatly reduced for TSMC customers starting this quarter”.10  One would expect this to take some of the heat out of semiconductor prices, and those of the goods that rely on them. As for shipping, which has affected the time and cost required for all international goods trade, expectations of future prices, as indicated by forward contracts (Chart 15), imply material declines over the next year or so. See, for example Winkelried (2021), ‘Unit roots in real primary commodity prices? A meta-analysis of the Grilli and Yang data set’. Journal of Commodity Markets, article in press. 10 See “TSMC signals global chip crunch may be easing”, Financial Times, 15 July 2021. 9  12  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  12  Chart 15: Forward contracts suggest material declines in shipping costs  Sources: Baltic Exchange and Bank calculations. Panamax is a sub-index covering mid-sized vessels travelling on 5 of the 23 shipping routes of the full index. It co-moves quite closely with the overall Baltic Exchange Dry Index.
Manuela Pfrunder, the graphic artist, has further developed her drafts and completed the design for the CHF 50 note, taking the technical aspects of banknote production into account. At its meeting of 29 August 2008, the SNB Bank Council approved the design of the new CHF 50 banknote and gave the go-ahead for the further work that is to be done. Preparations for the technical aspects of implementation of banknote production are now in full swing. A particular challenge is posed by the security features that will be used in the new banknote series for the first time. Based on the progress of work to date, the SNB is confident that the first banknote in the new series will be ready for production within the planned time period. The CHF 50 banknote will mark the beginning of the new series of banknotes and is scheduled to be issued in autumn 2010. The appearance of the new banknote and the security details for the entire series will be presented shortly before the scheduled issue date. 1  Nout Wellink, The Importance of Banking Supervision in Financial Stability, High Level Meeting, 17 November 2008, Beijing  BIS Review 157/2008  3

Elvira Nabiullina: Review of recent inflation developments in Russia and economic outlook Statement by Ms Elvira Nabiullina, Governor of the Bank of Russia, in the follow-up to the Board of Directors meeting, Moscow, 11 June 2021. * * * Today, we have decided to raise the key rate by 50 basis points to 5.50% per annum. As inflationary pressure has notably strengthened, we need to ensure price stability consistently and actively. We see the necessity of further increases in the key rate at upcoming meetings. Let me dwell on the factors behind the today’s decision. First. The Russian economy will return to its pre-crisis level during this quarter. Its H1 growth exceeds the pace we factored in in the April forecast. Leaving out restrictions on oil production and international passenger travel, it is clear that the output in most key industries has not only bounced back to the end-2019 level but outstripped it. Russia is among the group of countries that will be the first to reach the pre-pandemic level of output. It is typical of the current situation in many sectors of the economy that growth in demand is outpacing the potential to expand supply. Companies need time to roll out new capacities, and also hire and train staff. Demand is growing both domestically and abroad. The activation of external demand is underpinned by a faster-than-previously-anticipated rebound in the global economy and trade. The main reasons are abating epidemic risks, given vaccination rates, and extremely loose monetary and fiscal policies in major economies.
The statement shall comprise the first two parts of the report by the Zimmerli Expert Commission (on the creation of integrated financial market oversight and sanctions). The third part of the project (examination of expanded prudential oversight) will be dealt with at a later point in time. The Federal Council has taken various concerns of the National Bank into account. As regards the division of tasks between the supervisory board and the management board in particular, the Federal Council has moved closer to the view held by the National Bank, which believes it important that the power of disposition remains with the management board. As a non-professional body, the supervisory board is inevitably faced with conflicts of interest, which could prove an obstacle to individual dispositions. However, the experience and know-how of the supervisory board can be fully exploited with regard to the deliberation of questions of principle, budget and important staff issues. Furthermore, we support increased budgetary autonomy of the Federal Financial Market Oversight Authority (FINMA), as we are convinced that a financial centre that is as complex and significant as the Swiss financial centre requires an authority with a supervisory and management board whose powers are equal to those of the corresponding bodies of banks and insurance companies. The National Bank backs the project regarding the FINMA Act. We continue to view the integration of financial market oversight as a means to improve oversight rather than as an end in itself.

Should it emerge in the course of work - either with regard to sanctions or prudential oversight - that the planned reform is becoming so cumbersome that it jeopardises the present level of banking supervision, we reserve the right to reassess the project. Conclusion My explanations clearly reflected the National Bank’s wish to adopt a moderate stance with regard to public interventions. We are pleased that the Federal Council requests through the FINMA Act that the regulation consequences of new projects be assessed. The ongoing reform of capital adequacy requirements is driven by international standards (Basel II). It is the responsibility of the SFBC and the banks to find correct and acceptable solutions. Everything beyond this must be prepared by the G-10 bodies. The call for moderation directly affects the National Bank with regard to the oversight of payment and securities settlement systems. We contribute to minimising the regulatory burden by interpreting the term “systemically important” in line with the law, by closely cooperating with the SFBC and by taking into account the activities of foreign oversight authorities. We will continue on this path in the future, too. 2/2
Andrew G Haldane: The Great Divide Speech by Mr Andrew G Haldane, Executive Director and Chief Economist of the Bank of England, at the New City Agenda Annual dinner, London, 18 May 2016. *  *  *  I would like to thank James Antwis, Andrew Bailey, Jeremy Franklin, Jonathan Fullwood, Andrew Hauser, Andrew Hebden, Alex Holmes, Leanne Leahy, Emma Murphy, Ben Nelson, Laurie Roberts, May Rostom, Pedro Santos, Minouche Shafik, Emma Sinclair and Paul Robinson for their comments and contributions, and to Gillian Stamp for conversations on these issues over many years. In November last year, the Bank of England hosted a so-called Open Forum. This was a new departure. For the first time in its 300-plus year history, the Bank brought together all of the main stakeholders in the financial sector: not just policymakers, banks and investors, but politicians, civil society, businesses, regional representatives, religious groups and the media. This was a deliberately broad church, with an eclectic congregation comprising religious zealots, high priests, regular church-goers, agnostics and atheists. The aim of the Open Forum was to discuss, in an unscripted way, the progress made towards fixing the financial sector. The Open Forum was an opportunity to hear a different set of views from a different set of voices: from the customers and users of finance, as well as the producers and investors; from the often-silent majority of outsiders to finance, as well as the often-vocal minority of insiders. This made for a very different dialogue.

Technology has helped us reduce some risks and better manage others, but it has also introduced new risks and vulnerabilities. The regulator’s job is never done. And while we have gotten better at managing traditional risks such as credit and market risk, 8/9  BIS central bankers' speeches  cyber risk has now moved to the front of the regulatory agenda. But while the landscape has evolved and the nature of threats to financial stability has changed, the core principles of sound regulation remain evergreen. The goal is to keep the financial system stable and maintain public confidence and trust in the financial sector. And to do this in a way that allows the financial sector to innovate and grow, and serve the needs of the economy and society. That means taking a proportionate approach to risk, so that we can achieve resilience with efficiency, stability with growth, safety with innovation. Thank you. Everything said here about the future is pure imagination; it is neither a forecast nor a recommendation, by me or the Monetary Authority of Singapore. My intention is merely to paint a plausible scenario for the future of financial regulation, as food for thought for this Symposium. In all likelihood, the Symposium of 2028 will find my account lacking in imagination or realism or both. The truth will be stranger than fiction. 9/9  BIS central bankers' speeches
One response to the gaps revealed during the financial crisis was the adoption of the Dodd-Frank Wall Street Reform and Consumer Protection Act. It ushered in significant changes and also required numerous studies to be undertaken, and new regulations to be considered and promulgated. Much of this work is still in process. Some of the most significant aspects of the Dodd-Frank legislation involve seeking greater clarity in the resolution procedures for complex financial holding companies that experience difficulties; creating a Financial Stability Oversight Council; establishing a Consumer Financial Protection Bureau intended to address gaps in consumer protection; and increasing regulatory powers over, and focus on, systemically important financial institutions. A second major change resulting from the financial crisis has been a reappraisal of the quantity and quality of capital needed to avoid a reoccurrence. This matter is clearly critical to the Basel III discussions taking place here over the next two days; but, I would note, has already been the focus of two supervisory exercises conducted in the United States. As I will describe in more detail in a moment, during a financial crisis investors focus on how much “core” or “pure” capital exists in an organization to absorb immediate and near-term losses.2 Some of the broader definitions of capital include elements that are not actually readily available to absorb losses.

Capital meeting the broader definitions was largely ignored by investors during the intense phases of the crisis, leading to significant financial runs and liquidity problems at institutions whose capital, using the broader definitions, actually satisfied existing regulatory standards. As conditions deteriorated, market focus  1  These remarks were prepared for delivery at a gathering focused on “The New Framework to Strengthen Financial Stability and Regulatory Priorities”, jointly organized by the Financial Stability Institute and the banking supervisors from Central and Eastern Europe, and hosted by the Central Bank of the Russian Federation. 2  Beyond concern over immediate losses, investors may also focus on the possibility of future losses and the capital readily available to offset them. BIS central bankers’ speeches  1  shifted from the relative strength implied by regulatory capital ratios to the vulnerabilities associated with deteriorating measures of “pure” capital. This led to greater uncertainty and ultimately to liquidity stresses. The experience in the United States during the crisis is instructive as we think about where we should focus our attention in terms of bank capital, as well as in terms of supervision. On the latter, I would note that stress testing has proved to be an important supervisory tool in the United States for judging the quality and quantity of capital.
The concern six months ago was that a soft patch – amid an environment with little room for conventional monetary policy – could be particularly risky. However, growth picked up in the third quarter to an estimated 2.6 percent, and as 2010 came to an end, economists were revising upward their growth forecast for 2011. The risk that the economy will enter a double-dip recession now seems quite low. The increased optimism reflects in part the compromise on the extension of the Bush tax rates, the Federal Open Market Committee’s decision to purchase up to $ billion in Treasury securities, and stronger retail sales during the holiday season. While there are many factors that will affect the shape of the recovery in 2011, a key factor will be the degree of improvement in the labor market. From its peak in December of 2007, employment is down by 7.4 million jobs and remains below its level in January 2000. That is, the “Great Recession” eliminated an entire decade’s worth of job growth (Chart 2). Improved job growth is essential to generating the increase in disposable income that will support continued consumption growth which is so important for overall economic growth. Leading indicators for the labor market are pointing to a likely pickup in the pace of employment gains over the course of this year. Many new hires are preceded by firms posting job openings. According to the Labor Department, at the end of October, there were 3.4 million job openings, up from 2.3 million a year earlier.

In simpler terms, consumer spending of Albanian households, private sector investments, public spending and external demand for Albanian goods and services do not manage to fully use the productive capacities of the economy. The low aggregate demand leads to low increase in employment, wages and production costs, and hence to low inflation rates. Also, it poses difficulties for many businesses and is translated into increase in nonperforming loans in the banking system. In this context, undoubtedly, promoting and stimulating the economy should be a priority of the macroeconomic policies. The Bank of Albania deems that besides the classic instruments of the economic stimulus, monetary and fiscal policies, attention should be paid to smoothing uncertainties in the economy. I will briefly address three of these elements. First, in our opinion, the fiscal policy has limited space for economic stimulus. The rapidly expanding public debt increases the vulnerability of the Albanian economy and may make the fiscal stimulus counterproductive. We deem that the fiscal policy should focus on monitoring the public debt in the medium and long term. The Bank of Albania sticks to the opinion that the public finance consolidation should anchor to an effective and transparent fiscal rule. This rule would increase the short-term flexibility of public finances and reduce the fiscal adjustment cost. Second, the overall economic and financial stability is a prerequisite for a rapid economic growth. The monetary policy has been and will remain oriented toward meeting our inflation target.