samchain/econo-pairs-v1 huggingface dataset:
& A. Vredin (1999), "Different ways of conducting  4  BIS Review 10/2005  Flaws in the data underlying decisions and the difficulty of predicting what will actually happen in the future mean that the ability to evaluate and weigh up a large amount of complex information is what most distinguishes an accurate monetary policy from a less accurate one. Judgement is therefore highly significant for how good the final result is. This favours the use of a forecast-based monetary policy, which allows greater scope for judgements than a simple rule. Openness and communication The choice of monetary policy strategy is of key importance for a central bank’s external communication. Good communication with external players is extra important for central banks that conduct a forecast-based monetary policy. It is therefore important that the Riksbank is open about how we view economic developments and the inflation outlook and about how we have reasoned in our conduct of monetary policy. The aim is to create an understanding of what governs the Bank’s interest rate decisions and to generate support among the Swedish public for the inflation target. This is also a reason why we in the Executive Board often give public speeches. Openness and transparency from our side can help stabilise expectations regarding inflation and interest rate developments and lower the risk of unease in the financial markets.

In a few moments, I will talk about how this growth abroad also presents an opportunity for Puerto Rico. The firming in economic activity, in short, is due both to natural healing and past and present policy support. In this regard, it is important to emphasize that we at the Federal Reserve have been expecting the economy to strengthen. We provided additional monetary policy stimulus via the asset purchase program to help ensure that the recovery regained momentum. A stronger recovery with more rapid progress toward our dual mandate objectives is what we have been seeking. This is welcome and not a reason to reverse course. Yet, we must not be overly optimistic about the growth outlook. The coast is not completely clear – the healing process in the aftermath of the crisis takes time and there are still several areas of vulnerability and weakness. In particular, housing activity remains unusually weak and home prices have begun to soften again in many parts of the country. State and local government finances remain under stress, and this is likely to lead to further spending cuts, tax increases, or job losses in this sector that will offset at least a part of the federal fiscal stimulus. Moreover, in recent weeks we have experienced several shocks from abroad that could have some impact on the economy’s forward momentum, at least in the short term.
373–409 and Cochrane, John, H. (2011), “Inflation and Debt”, National Affairs 9, Fall 2011, pp. 56–78. 11  Letting the central bank itself determine the employment target is no solution, either. As discussed in the section on criticism of a lack of clarity, assessing what could be an appropriate target level/equilibrium level entails considerable problems. 12  A press release in connection with the Federal Reserve introducing an inflation target on 25 January 2012 stated that: “The maximum level of employment is largely determined by nonmonetary factors that affect the structure and dynamics of the labor market. These factors may change over time and may not be directly  6  BIS central bankers’ speeches  One can illustrate the fact that the long-run level of employment is determined by factors other than monetary policy in different ways. Following the crisis in the 1990s, unemployment and the employment rate have varied around an apparently unchanged long-run level, despite the policy rate having been both relatively high and very low during this period. Although there is a relationship between monetary policy and the labour market in the short run, monetary policy does not seem to have influenced the labour market on average. Despite periods of very strong growth and economic activity, unemployment has never been lower than just under 6 per cent, with an average rate of around 7 per cent since 2000. An overwhelming proportion of unemployment is thus structural rather than cyclical. This picture is also supported by unemployment varying substantially between groups.

Per Jansson: My view on inflation targeting Speech by Mr Per Jansson, Deputy Governor of the Sveriges Riksbank, at Karlstad University, Karlstad, 11 October 2012. *  *  *  Twenty years of a floating exchange rate I would like to begin by taking you on a trip back in time, twenty years ago to 11 October 1992. Sweden and a number of other countries were then in the midst of a crisis that in many ways is similar to the one many countries in Europe are now undergoing. The situation was critical. Property and financial companies had gone bankrupt, the entire Swedish banking system was rocked to its foundations, unemployment had begun to soar and public finances were drained. The fixed exchange rate was put under severe pressure and many assumed that Sweden would do what it had done so many times before – adjust the value of the krona to get the wheels in motion once again. Around one month earlier the Finnish central bank had been forced to give up its defence of the exchange rate and let the markka float. One week later, on 16 September, the United Kingdom and Italy decided to give up the fight for sterling and the lira. The Riksbank on the same date had instead raised its repo rate to 500 per cent in an attempt to stop the currency flows and the speculation against the krona.
Perhaps the most interesting example is the development of quality credit data which has enabled financial institutions to make informed and responsible lending decisions in a timely manner and to be able to mitigate serious problems such as fraud. These data have also assisted Bank Negara Malaysia in performing its macro- and micro-surveillance duties and in its policy-making role. The data in this case came from the development of a comprehensive credit registry system. The availability of such data also allows individuals with good payment track records to make a more credible case for access to credit, and helps overcome the limitation of inadequate collateral. Another example is the collaborative project with the Department of Statistics Malaysia to conduct the Baseline Census of Establishments and Enterprises in 2005. The data gathered from this initiative enabled the policy-makers to have a much more detailed profile of the SME and micro-enterprise segments of the economy. The insights gained led to a new understanding of the SME business landscape, and the launch of a national strategy for SME development. Specific strategies could be developed, and the availability of data helped in having more constructive dialogue between different stakeholders. We also note that relatively new policy areas for financial inclusion require better data that enable validation of policy stance, or in some cases change in policy direction.

It is key in formulating socio-economic programs including the Government Transformation Plan, the New Economic Model and the 10th Malaysia Plan. This commitment towards financial inclusion is reflected in the Central Bank Act 2009, where financial inclusion is legislated as an objective of Bank Negara Malaysia. The efforts to develop a more inclusive financial system have been fruitful. More than 80% of the Malaysian population currently has some form of savings account. Compared to the global median of 8.4 bank branches per 100,000 individuals, Malaysia has 15.5 branches per 100,000 individuals (31 March 2010) with the number of ATM cards in circulation increasing from 19.8 million (Dec 2006) to 28 million (April 2010), with an average annual growth rate of 11% in the last four years. Another important indicator is the total microfinance loans outstanding, which has increased from USD 45 million (RM 151 million) as at end-2000 to USD 757 million (RM 2.5 billion) as at end-March 2010, a compounded annual growth rate of 35.5%. While such positive trends are encouraging, we are also mindful of the associated risks, such as non-performing loans, over-indebtedness and consumption of financial products and services that are not suitable for the user. In this regard, efforts towards financial inclusion are always conducted within the framework of sound banking practices, risk management and adequate consumer protection. Importance of financial inclusion data in the growth and development of an inclusive economic system Policy formulation for financial inclusion is complex for a number of reasons.
During the 1980s inflation averaged 7% a year, and it is only since the inflation target regime was adopted in late 1992 that inflation has returned to both low and stable levels. Britain tried most types of monetary regime: targeting monetary aggregates both narrow and broad; shadowing an exchange rate target, and an explicit exchange rate target through membership of the Exchange Rate Mechanism. None was pursued for long, and none carried real credibility. It was following our exit from the Exchange Rate Mechanism in 1992 that the opportunity arose to put in place a new monetary framework based on an explicit target for inflation and a floating exchange rate. The aim of the MPC is to keep both inflation and inflation expectations at the target level of 2½%. It is no small part of a central bank’s role to create confidence and credibility in the belief that it will respond to any change in economic circumstances in order to maintain a broad degree of economic stability. In the economists’ jargon, the public must believe that the central banks “policy reaction function” is consistent with stability, and if it is predictable, then announcements on interest rates should not come as news. The economic data will have led to expectations about the likely course of interest rates which, in most instances will prove a reasonable guide to the course of policy. A clear sign of the success of the MPC will be when we are no longer news.

But, very occasionally, a constitutional reform occurs which leads to a new piece of machinery. That was the case with the MPC. The Committee itself has an interesting and unusual structure: five executive members of the Bank and four external non-executive members, all chosen for their expertise on monetary policy and not as representatives of different interest groups. You may wonder whether the nine members of the MPC have any historical antecedents. If you look carefully you can see them in one of our few remaining great Jacobean houses - Aston Hall in Birmingham. In the Great Dining Room there is a frieze, a marvellous example of early seventeenth century plasterwork, showing a set of nine warriors. These are known as the “nine worthies”, described as “high-relief figures in their own niches separated by scrolling”, a pretty good description of the MPC. The Nine Worthies of Chivalry as they are known, comprise three groups: three honest heathens, three Old Testament heroes and three champions of Christendom. It is interesting to speculate into which of these groups various members of the MPC fall, but I will leave that to you. But, wait a moment, there are two additional figures in the frieze. One is Perseus - presumably the minute taker. The other is described as a “so-far unidentified figure, certainly a later pastiche”. This must be the Treasury representative. Sadly, the debates among the nine worthies, presumably recorded in the minutes and reported to Sir Thomas Holte who commissioned the frieze, are lost to posterity.
One of the things that I strongly encourage for all countries is a review of implementation of the Basel Committee’s Core Principles for Effective Banking Supervision. These principles are key to laying a successful supervisory foundation. Likewise, sound accounting and provisioning standards are critical to ensuring that the capital ratios, however calculated, meaningfully reflect the bank’s ability to absorb losses. This brings me to the second stage. Supervisors do not need to wait for the formal adoption of Basel II to start introducing or using the principles of the three pillars. On the contrary, incorporating these principles is excellent preparation for adopting Basel II in the future. For example, supervisors might choose to move towards a more risk-based approach to supervision, developing skills in assessing the quality of a bank’s risk management and its ability to assess risk exposures. At the same time, banks could be reminded of their responsibility to develop their own processes for evaluating their capital needs and a strategy for maintaining their capital levels, consistent with the principles of Pillar 2. With regard to the principles of market discipline in Pillar 3, supervisors may wish to focus initially on ensuring a baseline level of disclosures across all banks. This might include discussing with banks, investors, and other users of financial information their information needs and the tools available so that supervisors can tailor requirements accordingly. In my view, these two preliminary stages provide an excellent preparation for the “final” stage of moving to Basel II.

We also know that banking crises can threaten macroeconomic stability through their potential effects on confidence, savings, financial flows, monetary control and the budgetary impact of bank rescue packages. In sum, achieving an inclusive, efficient, sound and stable financial system is an important and complex task, and it has many dimensions. To me, Basel II represents a tremendous effort of more than six years to analyze and promote some of the main elements of a sound banking system: those related to risk management and capital. My talk will address two main issues. First, I will share some reflections on how I believe Basel II will contribute to the stability of the financial system. Secondly, I will offer some thoughts on steps countries can take in preparation for adopting Basel II. Basel II and financial stability Banking is fundamentally about trust. Banks are charged with a special public trust to safeguard customers’ wealth. We have all seen what happens when customers lose trust in the ability of individual banks or the banking system as a whole to protect their savings. This puts a special onus on banking supervisors to ensure that banks operate soundly. No bank can maintain public trust for long if it lacks sufficient capital, so supervisors impose capital requirements to safeguard the banking system. Since capital is the last line of defence against bank insolvency, regulatory capital requirements are one of the fundamental elements of banking supervision.
The economic and financial situation and prospects are characterised by two features: first, a synchronised decline or deceleration in economic activity in all economies which is associated with a collapse in world trade; and, second, growing signs of an adverse feedback loop between the real economy and the financial sector. Although the sharp drop in the value of toxic assets has weakened many banks’ balance sheets, the weakening of economic activity has been impairing the quality of bank loans, adversely affecting their capital positions and their willingness to extend credit to the private sector. This, in turn, constrains the pace of economic activity and the ability of the private sector to service its debts, entailing a risk of a vicious circle. II. Policies for economic recovery and sustained growth  These observations have two general implications for economic policy. First, the economy’s recovery requires the simultaneous implementation of macroeconomic policies to stimulate aggregate demand and of measures that will help repair banks’ balance sheets and encourage the provision of credit to the economy. In this way, a potential vicious circle can be prevented. Second, concerted policy efforts in all economies, especially the large ones, are necessary so that world trade can be revitalised and financial capital flows stabilised. This will help support the emerging market economies and global growth.

Consequently, a monetary policy that aims to address potential disinflation risks and maintain medium-term price stability must be implemented in a manner that also ensures the preservation of price stability over the longer term. Financial system reform And this brings me to two final points concerning two other essential conditions for sustainable growth: financial system reform and sound fiscal policy. It is by now generally agreed that there is both a great and urgent need to introduce reforms that prevent the recurrence of episodes of financial market excesses and corrections and that will make the global financial system more resilient to shocks. An extensive and impressive amount of work has been undertaken by national authorities and international bodies, under the auspices of the Financial Stability Forum and, more recently, the G20 process. Concrete proposals have been formulated – and others are currently being elaborated – on how to reduce the cyclicality of the financial system through various measures and reforms, including the enhancement of the scope and effectiveness of financial regulation and supervision. In the EU, the report of the de Larosière Group is a valuable contribution to this end. The forthcoming summit meeting of the Group of 20 in London can mark a further important step in the effective pursuit of this reform agenda globally.
As of end June 2008, credit portfolio of the banking system accounted for nearly 43% of total assets, increasing by 3.6 percentage points relative to end-year 2007. Consumer deposits remain the main funding source for the activity, accounting for 80% of total assets. Business funding through the credit lines from the parent banks increased to 9% of total assets in the first half of 2008. As of end June 2008, return on average assets was estimated at 1.3% while return on average equity equalled to 16.6%. Capitalization indicator of the financial sector, and in particular of the banking one, increased slightly. Capital adequacy rate of the banking sector showed a slight increase to 17.3% as of end the first half of 2008. Liquidity indicator continues to remain at higher levels compared to the other regional countries. Liquid assets of the banking sector share 47% of total assets, dropping by about 5.7 percentage points relative to end-year 2007. The spread of the U.S. economy crisis to the international financial markets and the uncertainty for the nature of its effects, the institutions’ map, the types of instruments and its extent, do theoretically increase the risk of its impact on the financial system at home. Basically, this crisis has not provided its impact on the banking activity in Albania.

The national payment system is the backbone of a country’s monetary and financial system and it plays a critical role in a country’s economic development. It is through the payment system that money is transferred between savers and lenders, buyers and sellers or from one point to another. Developing a national payment system is an ongoing process. By reforming and developing the national payment system, it is possible to reduce the overall transaction costs and expand opportunities for commercial and financial transactions in an economy. In recent years, there has been a rapid acceleration in fundamental reforms to national payment systems worldwide, although the pace of implementation of reforms in different countries has been uneven. Planned outcomes have not always been achieved in terms of expected use, benefits or costs of payment system reform projects and many planned reforms have been unexpectedly slow to complete. In its modernization programme which commenced in 2001, the Central Bank refocused on its core objectives, i.e. the economic and price stability and the financial system stability. The financial system stability objective encompasses a wide range of subjects of which, the establishment of a safe and sound payment system was seen crucial for the development of the financial sector, which is also complementary to the maintenance of price stability. In this context, the Central Bank examined the adequacy and the efficiency of the payment system to satisfy the needs of an evolving economy and decided to undertake comprehensive payment reforms.
For us at the National Bank, the achievement in the fourth component - research, knowledge and skills in policy analysis - will be of immense importance. Emphasis will be on assessing the relationship between real and financial cycles and identifying the implications of financial factors for the economic fluctuations in the Macedonian economy. This topic has been particularly relevant since the outbreak of the global economic crisis, and undoubtedly, analyzing it will improve the recommendations of decision makers. Distinguished guests, It is a great pleasure for us to partner with the central banks of Germany and Croatia in delivering such a large and significant project. I thank them for being part of this project and for supporting us in the process of European integration. I also thank the central banks of Belgium, Lithuania, Portugal, Romania and the Netherlands who have also accepted to support our way towards European values. I believe in the not too distant future we will be partners not only in implementing projects, but also equal partners in the creation of European standards in central banking. Finally, let us remember what Robert Schuman said in the 1950 Declaration, “Europe will not be made all at once, or according to a single plan. It will be built through concrete achievements which first create a de facto solidarity.” I hope that the achievements we make during the project delivery will reaffirm our readiness to be active and beneficial participants in the further construction of Europe. Thank you for your attention.

Upon significant alignment with the European capital requirements, the focus will now be on the process of managing liquidity, but also on strengthening risk management in general, especially credit risk, which given the structure of banking activities is the most significant risk in the banking book. Project activities are in line with the latest Joint Conclusions of the economic and financial dialogue with the EU and among other things are aimed to further reduce non-performing loans, i.e. improve the quality of banks’ balance sheets, which is important prerequisite for stronger credit support. I am pleased that this project validates our strategic goal of providing quality statistical data, fully compliant with international and European statistical standards. Specifically, the third project component focuses on the further development of financial account statistics, which is key to identifying cross-sectoral linkages within an economy and thereby identifying any possibility of spillover of shocks from one sector into another. Recently, we have taken a number of activities in this segment. Almost two years ago, we made our first data transfer of the annual accounts - stock to Eurostat, and in April last year, we prepared detailed data on the flow of assets and liabilities for the government sector, which is one of the key components in compiling spreadsheets for the excessive deficit procedure (EDP). The project activities will be aimed to further improving of the quality of this statistics, especially given that its first release is scheduled for next year.