samchain/econo-pairs-v1 huggingface dataset:
Many expect both political uncertainties and oil prices to affect consumption and investment, but the latter to also have adverse impacts on our future ability to produce or what economists often call “productivity.” To add even more bad news, higher oil prices caused headline inflation to accelerate, registering 8.9 percent in June – the highest rate for the last 10 years. Given all available indicators, it is very likely that inflation will remain elevated for a while. Periods of rebounding consumer and businesses’ confidence seem to have come to an end – a picture that many of you may have currently embraced. Ladies and Gentlemen, Despite the adverse domestic and external shocks, the Thai economy has so far continued to perform well. Latest economic indicators for the first two months of this quarter showed  BIS Review 98/2008  1  continued expansion of both domestic spending and exports. On the supply side, production and prices of major crops grew markedly, resulting in an acceleration of farm income. Manufacturing production and the tourism sector also expanded well. The continued economic expansion has facilitated greater pass-through from producer prices to prices of other goods, lifting inflation further beyond the initial cost shocks. Given the ongoing trend in inflation rate, however, the economy in this second half of the year will likely be less robust. There are some indications that the rise in the cost of production and the acceleration of inflation have begun to affect the economy’s growth momentum.

To take this further and fully realise the benefits, cross-border coordination will be key to promote uniformity in how the standards are interpreted and operationalised. Promoting competition The fourth perspective for the regulatory agenda relates to the need to promote efficiency and innovation through greater competition. Given the importance of scale and network effects in delivering payment services, it is no surprise that the payments industry tends towards an oligopolistic structure. These market dynamics are amplified in the digital payments market. ‘Winner-takes-all’ dynamics are synonymous with digital platforms, which often aim to build as large of a network as possible. After all, this facilitates a virtuous cycle of more data, leading to better and cheaper services, which in turn leads to more customers – so on and so forth. To this end, regulators must ensure that these market dynamics do not result in perverse outcomes for the payments ecosystem as a whole. Such perverse outcomes could include the abuse of a dominant market position to erect undue barriers to entry, or to impose exorbitant prices on end-users. Encouragingly, regulatory authorities are increasingly playing an active role in mitigating such risks. Of significance are efforts to promote open access regimes to key payment infrastructures, regardless of whether the payment service provider is an incumbent bank or a non-bank player. In Hong Kong, the Faster Payments System (FPS) was launched in September 2018 with a total of 21 banks and 10 non-bank e-money issuers participating in the scheme.
The challenge that we are having right  The country has a number of structural  now is to put in place policies that give  problems that have been amplified over  us sustained stabilisation of  the years by the large fiscal and trade  macroeconomic fundamentals in the  deficits, which are the core weaknesses  country, amidst uncertain global  of the Sri Lankan economy. Being a twin  conditions. deficit country increases vulnerability in  It is important to recognise that stabilising the economy after decades of  an uncertain and volatile global economic environment. fundamentally unstable macroeconomic  Unsustainable budget deficits boost  policies cannot be achieved without  excess and untenable demand in the  discipline. This will inevitably result in  economy. When there is excess demand,  some pain in the short-term. However,  it leads to inflationary pressures and  there is every possibility that a more  higher nominal interest rates in the  promising future can be realised  economy and there is also a higher  through the policies and programmes  propensity to import, given the  that are already in the pipeline. For this  limitations in domestic supply. That in  to happen, consensus must be built  turn, exerts pressure on the balance of  among politicians, policy makers and  payments and the exchange rate.

Third, the entry into force of the Mechanism will entail the need to conduct new activities and develop new functions: the monitoring of the banking systems of the remaining euro area countries, which is needed to underpin the Banco de España’s place on the Supervisory Board; participation in the definition of the Mechanism’s supervisory policies and in the administrative procedures in relation to the significant banks; and also collaboration in the performance of other horizontal and specialised supervisory functions developed by the SSM. Fourth, there are certain areas of banking activity whose supervision will not be assumed by the Mechanism, but will continue to be within the remit of the national authorities. The Banco de España will thus continue to exercise supervisory powers in the areas of money laundering prevention, consumer protection and, partly, in the oversight of financial markets. It will also retain the supervision of banking foundations within its sphere of competence, that is to say having regard to regional governments. Fifth, the Banco de España, like the other national supervisory authorities participating in the SSM, fully retains its supervisory powers over non-bank financial institutions, other financial institutions and entities related to the financial sector such as payment institutions, electronic money institutions, credit financial intermediaries, mutual guarantee companies, currencyexchange bureaux and appraisal companies. In short, with the launch of the SSM, the main centre of supervisory decision-making on significant Spanish banks has passed from the Banco de España to the ECB.
With a flexible exchange rate regime, there is nothing new about some depreciation in connection with a cyclical downturn. Numerous examples can be cited from all over the world. Basically, in a small, open economy the exchange rate often functions as a sort of shock-absorber. The problem today is that the krona’s depreciation has occurred from a level that was already weak. This amounts to a further appreciable lowering of Swedish manufacturing’s relative costs and thus an increased profit share. Our experience from the 1970s and 1980s has shown that a weak exchange rate can generate inflationary tendencies. Let us not forget what happened in recent years. When the krona weakened in connection with the crises in Mexico, Asia and Russia, Swedish exports recovered quickly and strongly. During the autumn of 1998 exports dropped, order inflows were weak and forecasts where quickly revised downwards; but just a few quarters later production for export was booming again. So it is reasonable to expect that sooner or later, although just when is not clear, Swedish exports will pick up this time as well. But the terrorist attacks have probably postponed the recovery and perhaps even accentuated the slowdown in the short run. It is important to keep an eye on the exchange rate as well as economic activity. On the domestic scene there are some bright spots. Household disposable income, for instance, looks like rising strongly next year.

Contributory factors are a falling rate of inflation, fiscal stimuli and, not least, a labour market with no dramatic changes, at least at present. Moreover, real interest rates are low. All this probably reduces the risk of private consumption continuing to weaken. At the same time there are many indications that the reduction of equity wealth in recent years has had an appreciable negative effect on purchases of consumer durables. So there are good reasons for supposing that it will be some time before households are again prepared to invest in new cars and other capital goods. Consumption may therefore remain weak for somewhat longer. In other words, there is a risk that,  BIS Review 82/2001  3  despite the weak exchange rate and low real interest rates, the Swedish economy will recover more slowly than expected earlier. To sum up, a number of factors point to a gradual economic recovery in Sweden in the course of next year. This picture could still be changed by many things. One factor is the terrorist attacks and their aftermath. Another is, of course, the extent of the economic adjustment that occurs in the United States as a consequence of the imbalances that have accumulated in recent years. Monetary policy Swedish monetary policy in the past year has had to consider an economic slowdown on the one hand and a depreciating currency on the other.
The starting point should be our existing regulatory frameworks – for investment products, for exchanges, for payments systems and other financial functions – and the level of assurance we require that the relevant risks have been managed. Technological change and different business models may mean we have to find new ways to deliver that assurance. We should be under no illusions that this will always be an easy process. For example, as I have said, it remains for me a very uncertain question whether use of the permission-less blockchain could deliver the necessary level of assurance for activities that are integral to the stability of the financial system. Our approach as regulators should be open – by which I mean we should be prepared to explore whether and if so how the necessary level of assurance – equal to that in conventional finance could be attained. But we should also be firm that where it cannot, we are not prepared to see innovation at the cost of higher risk. This is very much the approach we are looking to take in the UK for the extension of the regulatory framework to the use of crypto technologies and business models in finance. The Financial Services and Markets Bill, currently in Parliament addresses the regulation of payment systems using “digital settlement assets” defined as “digital representations of value” – in other words digital tokens representing money.

See the discussion of the potential risks and benefits in Cunliffe (2022): ‘Innovation in post trade services opportunities, risks and the role for the public sector’. 6. Financial Services and Markets Bill – Articles 21 and 22. 7. The Banking Act 2009 provides the statutory basis for the Bank’s oversight of payment systems. It allows HM Treasury  Page 10 to recognise systems for supervision by the Bank of England as part of the Bank’s objective to maintain UK financial stability. 8. Bank of England Record of the Financial Policy Committee Meeting  13 December 2019. 9. Bank of England Record of the Financial Policy Committee Meeting 24 March 2022. Sir Jon Cunliffe Deputy Governor, Financial Stability  ©2022 Bank of England
His contributions to the nation were suddenly halted by his untimely death at the prime age of 63, an age which is relatively low for an academic. When a person dies, he is normally missed only by his family members and close relatives. But in the case of Professor Tilakaratna, he is missed by all, his colleagues, students, academics and the rest of the people in the country. I choose an appropriate topic for my lecture, based on Professor Tilakaratna’s long conviction that Sri Lanka’s economy should move forward on the basis of its comparative advantage. Being a trade specialist, he always believed that any other mixture of economic policy would lead to a sub-optimal solution. He cautioned that economic policies, not supported by solid economic principles, but merely guided by narrow emotion-driven ideologies, would be non-sustainable. This led me to examine the current controversy surrounding the services sector as a viable and sustainable wealth creator for Sri Lanka. The services sector is often quoted as a sector that does not or cannot create real wealth. This view is sometimes expressed by even mainstream economists. According to them, real wealth in a society is created only by visible products that are generated by agriculture or industry. On the contrary, the services sector which produces invisibles does not lead to any improvement of wealth on a long-term basis. Hence, any preponderant growth in the services sector over the real-good producing sectors is considered as a risk.

Jean-Pierre Roth: The position of the Swiss franc exchange rate in the Swiss National Bank monetary policy strategy Summary of a speech by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank and Chairman of the Board of Directors of the Bank for International Settlements, at the University of St. Gallen, St. Gallen, 19 December 2007. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch). *  *  *  The exchange rate is an important factor in determining the domestic price level in Switzerland. Nevertheless, it is not a monetary policy goal for the Swiss National Bank and is only relevant insofar as it has an impact on future inflation. Our concerns about our currency's weakness should not be read as a hidden form of exchange rate policy but rather as genuine concern about future price stability. A sustained tendency to weakness on the part of the Swiss franc could trigger inflationary effects that – sooner or later – would have to be countered with monetary policy instruments taking the form of interest rate measures. In the medium-term, this could lead to a reduction in the interest spread between the Swiss franc and the euro. BIS Review 151/2007  1
It is reasonable to distribute our petroleum wealth equitably among generations. The size of the cash flow from petroleum activities also varies considerably. If petroleum revenues were to be used as they accrue, this would lead to wide fluctuations in demand in the Norwegian economy. Cyclical fluctuations would be much more pronounced. Third, the use of petroleum revenues will have an impact on competitiveness in Norwegian business and industry. The level of and fluctuations in the use of petroleum revenues will have a considerable impact on the exchange rate and thus on growth in regions with extensive export activities. The Government Petroleum Fund was established in 1990 with a view to safeguarding long-term considerations in the use of petroleum revenues. In March 2001, the fiscal rule and new guidelines for monetary policy were introduced. The fiscal rule implies that the central government budget deficit shall be equivalent over time to the expected real return on the Government Petroleum Fund. The new guidelines for economic policy received broad support in the Storting. The rule specifying that only the real return on the Petroleum Fund is to be used means that the capital in the Fund shall not be depleted. The capital in the Petroleum Fund will increase as long as there is a positive cash flow (to the central government) from petroleum activities.

Inflation has risen slightly in most countries, owing mainly to the increasing oil price. But excluding oil, inflation has not risen at the same rate. There are plenty of spare resources in several of the biggest economies, and in recent years competition has toughened in many industries. As a result, international inflation is forecast on the whole to be relatively moderate in the coming years. The economic situation in the US and the euro area In the US the economic situation is continuing to improve. In the fourth quarter last year GDP in the US rose by 0.8 per cent compared with the previous quarter, partly due to a sharp increase in investment. This reflects a benign investment climate in the US with historically high profits and optimism among firms. Indicators of growth prospects for the fourth quarter provide a positive picture of the activity level in the US economy. As resource utilisation has picked up the Federal Reserve has raised its key policy rate from 1 per cent to 2.5 per cent. Many factors suggest that we can expect the tightening to continue in the spring. Inflation is estimated to rise in the period ahead, partly because the weakening of the dollar in recent months has made US imports more expensive. In the main scenario of the Riksbank’s most recent Inflation Report the US economy is expected to continue to perform strongly in 2005 and 2006.
In step with the normalisation of monetary policy, net purchases under the pandemic emergency purchase programme (PEPP) were discontinued on 31 March. The maturing principal payments from securities purchased under the PEPP will be reinvested until at least the end of 2024, and in the event of renewed market fragmentation related to the pandemic, PEPP reinvestments can be adjusted flexibly. Further, at our meeting of 14 April, the Governing Council judged that the incoming data reinforced our expectation that net asset purchases under the asset purchase programme (APP) should be concluded in the third quarter of 2022. We also indicated that the raising of key ECB interest rates will take place some time after the end of the net purchases and will be gradual. Lastly, the ECB Governing Council stated that we stand ready to adjust all of our instruments within our mandate, incorporating flexibility if warranted, to ensure that inflation stabilises at its 2% target over the medium term. The pandemic has shown that, under stressed conditions, flexibility in the design and conduct of asset purchases has helped to counter the impaired transmission of monetary policy and made the Governing Council’s efforts to achieve its goal more effective. Within the Governing Council’s mandate, under stressed conditions, flexibility will remain an element of monetary policy whenever threats to monetary policy transmission jeopardise the attainment of price stability. In step with the communication of this process of monetary policy normalisation, market expectations of policy rate hikes have been brought forward since December.

The persistence and intensity of inflationary pressures reflect a combination of various demand and supply factors. Notable among the demand factors are the relatively strong recovery in activity following its collapse in 2020 and the changing consumption patterns as a consequence of the pandemic and the measures adopted to contain it. Among the supply factors, the higher price of energy - with major strains in the gas market - and the disruption to global supply chains stand out. This high global inflation environment was also reflected in expectations of monetary policy normalisation and, in consequence, a moderate tightening of private-sector financing conditions. 1  As at global level, the repercussions of the war for the Spanish economy are highly uncertain. Spain’s direct exposure to the countries at war is low. However, the invasion of Ukraine has also changed the economic environment and represents, at a time when the recovery from the pandemic remains incomplete, a new shock that can be expected to entail adverse consequences in the coming quarters for economic activity and inflationary pressures through various channels. Of these channels, the most important is probably commodity markets, including markets for both energy and non-energy commodities, in particular foodstuffs and metals, of which Russia and Ukraine are both significant global producers and exporters. Spain’s direct exposure to these imports is relatively low; for example, in 2019 only 6% of its total energy purchases from the rest of the world came from Russia.
That is to develop a ‘strong and simple’ prudential framework for non-systemic banks and building societies. Sam Woods spoke about this in his Mansion House speech last November.2 He said then that the PRA would publish a Discussion Paper in the spring of this year explaining more about what we want to achieve with this initiative and how we think that might be done. That Discussion Paper was published today. I will go on to explain some of its most important elements and to describe the type of responses we hope it will prompt. But I want to start by emphasising the openness of this Discussion Paper. I explained that accountability will sometimes include discussions with industry and stakeholders about the right way forward. That is why we are publishing a Discussion Paper about the strong and simple framework before developing detailed policy proposals for consultation. We are doing this because we recognise that there are many ways a strong and simple framework could be designed and that each has its advantages and disadvantages. The Discussion Paper sets out the key design choices which will determine the overall shape of the strong and simple framework, explains the trade-offs which need to be weighed up when choosing between them, and invites comments about the merits and drawbacks of different options. Those comments will help us when we come to design proposals for consultation. The Discussion Paper is therefore open about the choices which confront us. And we have an open mind about what options we might choose.

In somewhat simplified terms there are two different ways to describe monetary policy based on inflation targeting: The first is to employ a simple monetary policy rule whereby the policy rate is set as a function of the current inflation rate and the output gap, which is a measure of the difference between actual and potential output and reflects resource utilisation in the economy.1 When the output gap is negative, actual output is lower than potential output, which means that there are plenty of spare resources in the economy. In such a scenario price and wage increases are small and inflation is generally below target. When the output gap is positive the situation is the reverse: resources are overstretched and the excessive demand generates inflationary pressures in the economy. So according to the rule the policy rate should be raised if growth is above its potential rate and inflation is higher than the inflation target, and vice versa in the reverse situation. When actual and potential output are the same the economy is in balance and inflation is normally in line with the target, provided that policy is credible. A common argument in favour of conducting monetary policy in this way is that the central bank’s knowledge of how the economy functions is too limited for a forecast-based monetary policy to be formulated in a good enough way. Incorrect forecasts can also burden the central bank with credibility problems, which is one reason to prefer a simple rule.