samchain/econo-pairs-v1 huggingface dataset:
The degree of pass-through of the (dis)-inflationary shock to core inflation A critical determinant of the potential persistence of the current inflationary process is the degree of pass-through of the inflationary shock to core inflation. While our understanding of this aspect has improved, more evidence is clearly needed. Our estimates at the Banco de España suggest that in the latter part of 2022 around 30% of the deviation of euro area core inflation from its historical average was explained by energy prices, another 30% by demand pressures and around 10% by supply -side disruptions or bottlenecks 3. The upward effects of energy and food commodity prices could still be significant in 2023. In the case of food commodities, the transmission of increasing costs along the supply chain, i.e. from farm-gate and wholesale commodity prices to producers and retailers, may take up to a year. 4 In the case of gas prices, the pass-through from wholesale prices to final retail prices for consumers varies significantly across countries depending on the regulations in place, the types of contracts used in each national retail electricity market, and the profit margin developments in the face of rising energy input costs. The analysis at the Banco de España finds that indirect effects from a gas price shock are quite persistent, peaking after one year5.

I am hopeful for two-days of productive workshop interactions. I invite you to join the panels of presentations and become part of the fruitful comments and discussions! 2/2  BIS central bankers' speeches
But the difficulties we are encountering in the European Union and in the Monetary Union have not only to do with the weak fiscal foundations of this edifice. They are also related to problems of what we call “governance”. Clearly, we have extremely complex negotiating and decision-making procedures in the European Union and the Monetary Union. And, irrespective of or in addition to macroeconomic imbalances, these problems affect the stability of the markets and the perception of risk regarding the area’s future. Most Britons are sceptical about Monetary Union and its future. Although it is not very politically correct to say so, the truth is that this scepticism is really not too bad for us since it helps those of us who are members of the Monetary Union to see ourselves from outside and to take, perhaps, a more realistic view. Sceptics or not, we can agree that the  BIS central bankers’ speeches  1  fallout from a failure of the Monetary Union would certainly affect the future of the European Union as a whole. The United Kingdom chose not to participate in the Monetary Union and holds firm to this position. Indeed, it would be strange if it were to change its mind in the current circumstances. But it’s clear to me that the United Kingdom has no interest in European Monetary Union failing.

In that context, both the ECB and the SNB conduct a careful analysis of monetary aggregates partly in an effort to assess the risks of long-term financial imbalances. Moreover, acknowledging the monetary source of long-term inflation helps avoid the build-up of excess liquidity in the first place. In closing, let me therefore repeat that the Fischer et al. paper could benefit from focusing more extensively on the admittedly complex but nonetheless important link between money, asset prices and long-term inflation perspectives. In the  4  For example, Nelson (2003) argues that movements in monetary aggregates provide useful indications regarding different yields usually not incorporated in economic models  5  Baltensperger, Jordan and Savioz (2001), Jordan, Peytrignet and Rich (2001)  6  Reynard (2006)  7  For example, Issing (2002) provides evidence of a close relationship between excess money growth and real asset prices, a relationship that does not appear by looking at a standard Taylor rule as a measure of monetary policy stance. Similarly, Friedman (2005) showed that pre- and post-financial market crash evolutions of stock prices and gross domestic products were strongly related to the pre- and post-market crash evolutions of monetary aggregates. White (2006) pointed to the need of pushing further the frontiers of economic research in the direction of incorporating financial variables to assess longer-term macroeconomic developments.
This real quantity has to be exchanged among members of the society. Since it is practically impossible to trade one commodity for another commodity in a modern complex economy, there arises the need for adopting a common medium of exchange. “Money” offers the service of this common medium of exchange at the cheapest cost to conclude the transactions running into billions. BIS Review 48/2007  1  Money, unlike the real commodities, is a peculiar animal. Its usefulness arises from its ability to acquire real goods and services which people can enjoy. If money does not have this ability, no one would be interested in having money. Hence, the value given to money is simply an imaginary value . As a result, money bears a nominal feature, as against the real feature borne by other goods and services. That is why any value measured in terms of money is also known as a nominal value. We may illustrate the role played by money in an economy by considering the operation of a simple economy where there are only two commodities, say, coconuts and money. Everybody has to use money to get coconuts or use coconuts to get money so as to store their wealth (for getting coconuts in the future). Suppose there were 10 coconuts and 100 units of money. Then, each coconut has to be exchanged for 10 units of money per coconut.

W A Wijewardena: Central Bank – why “economic and price stability”? Speech by Mr W A Wijewardena, Deputy Governor of the Central Bank of Sri Lanka, at the Association of Professional Bankers, Colombo, 23 March 2007. *  *  *  An amendment effected to the Monetary Law Act in 2002 requires the Central Bank of Sri Lanka to pursue “economic and price stability” as one of the two core objectives of the Bank. This is somewhat a departure from the central banks in the rest of the world which have been mandated to attain only “price stability”. Hence, it may be puzzling to many whether the Central Bank of Sri Lanka has been given an additional objective to attain. It is, therefore, timely to identify the precise meaning of this phrase “economic and price stability” in the context of a central bank. The amendment to the Monetary Law came as a part of the modernization program which the Bank commenced in 2000. One of the essential ingredients of that program was to update the Monetary Law to be on par with the emerging global best practices. Up to that time, the Central Bank had been entrusted with a multitude of objectives: attaining price stability, participating in economic development, preserving the external value of Rupee, protecting banks from collapse and maintaining the financial system stability etc. These objectives were not very clear and were often in conflict with each other. They also posed difficulties in monitoring the progress or assessing the success.
By the end of the third quarter of 2009, the total assets of Islamic investment funds were estimated at about $ 27 billion, spread across 478 Islamic investment funds worldwide. Dear audience Islamic banking contributes to social and economic development through investment in areas related to the real economy such as production of goods and services and commerce. In addition, Islamic Banks and Institutions have proved their success in attracting savings, fulfilling customer’s needs and achieving their interests. Moreover, Islamic banking has made great strides in boosting banking business by introducing innovated products and tools and by adopting new financing forms such as Ijarah (leasing), Istisnaa and Salam, along with Mudarabah (profit and loss sharing) and Musharakah (partnership). Furthermore, a variety of Islamic Sukuk (Islamic bonds) has emerged, and some Islamic banks have started to arrange for syndicated financing transactions in accordance with Islamic forms, and others are managing Shari’ah-compliant investment funds. Every tool of the Islamic banking has its own contractual nature and features, which differ from other tools in terms of risks, guarantees and pricing. Islamic banking services have not been confined to the activities mentioned earlier, but the scope of their transactions has been extended to include other services such as: providing joint finance, issuing banking bonds and opening letters of credit. Islamic institutions and banks provide a variety of finance and insurance methods for enterprises, management of financial portfolios, and Tawarruq assets (assets securitization).

In some market segments, especially in more complex ones, a large share of trading volume is attributed to HLIs. However, measured by assets under management, the HLI industry is still small compared to traditional investment funds and the trading books of large international banks. Because of its modest size, its  14  See also The President's Working Group on Financial Markets, 2007, recommendation 5. BIS Review 74/2007  5  heterogeneity and its absence from the field of financial intermediation, the HLI industry is no direct threat to financial stability. Nevertheless, there are two channels through which a shock occuring in the HLI industry could be transmitted to systemically relevant banks. First, banks are exposed to HLIs in their role as counterparties and creditors. Second, in periods of stress, banks may suffer from a lack of market liquidity and a decline in prices, and this may be aggravated by HLIs. Potential regulatory measures should therefore focus on the link between the HLI and the banking industry. Of particular importance is that banks simulate their risk exposures to HLIs and the liquidity situation in periods of stress. We encourage the private sector to take the initiative and come up with measures which will enhance market discipline and strengthen banks' resilience to losses from HLIs and adverse market situations. At present, we do not see a need for direct regulation of HLIs.
However, people should exercise some caution before utilising such cyberpurse facilities. Regardless of how the system may be presented, the purse operator is in effect acting very much as a bank, in particular by holding your money in a sort of deposit. Even if you initially acquired the digital cash or credit for free (through a loyalty or bonus point scheme, for example), the accumulated “savings” represent value which you would doubtless wish to protect. Customers will want to be assured that the money or credit points are in safe hands. Regulators, too, may desire to verify that no banking activity is taking place that is unlawful, although they will first need to ascertain the location of this virtual operation (a task which is itself almost a contradiction in terms) so as to identify what is the applicable jurisdiction. Although in most of these schemes the maximum sum which anyone may hold in a purse may, for the moment, be quite modest, and so the scale of potential losses limited, we need to establish the foundations of prudent behaviour and regulation in preparation for the time when the sums may be much larger. Thus far I have been looking at the phenomenon of e-banking and e-payments largely from the regulatory point of view. I would like to turn now to examine whether there are any noteworthy implications for the key central bank responsibility of monetary policy. I want first to consider possible implications for the physical currency.

With regard to operational aspects of monetary policy in pursuit of the general macroeconomic objective of stability in the value of the currency, the advent of this new means of payment would, if it caught on to a significant extent, have some impact on the public’s allocation of money holdings as between physical currency, various forms of deposit and, now, electronic forms. This in turn might affect the monetary statistics and their interpretation. However, any changes would only occur gradually. Besides, nowadays there are scarcely any central banks which rely single-mindedly and exclusively upon measures of money supply to guide their monetary policy decisions. Therefore I do not believe that there is anything much to worry about on this front. Next, it has been suggested that internet banking in its various manifestations could introduce additional and unpredictable volatility into world financial markets by enabling millions of people to switch funds between investments or between currencies at the click of a mouse. In general I am sceptical about such worries. Global financial markets have already been exploiting the IT age with its 3  BIS Review 28/2000  immediacy of information and electronic dealing for some years. Capital is already hugely mobile in both scale and speed. I doubt whether the inclusion of new players at the retail level would have much of an additional impact.
This design worked incredibly well, as activity in most of the facilities gradually declined to near zero, allowing the Fed to simply turn them off with no market disruption. Overall, central banks were able to accommodate the most extreme shift in the demand for liquidity that has been seen in a generation, and to do so in ways that responded to the specific needs that arose in a market-based credit system. Structural changes in dollar asset markets Although U.S. authorities managed to provide the financial system with sufficient liquidity and support to stem the market panic, they must now find a way to foster more enduring changes that will result in a sounder financial system. The crisis revealed significant structural flaws, but reforms are being debated to address many of these issues. Some of the required changes are associated with the oversight of large and interconnected financial institutions. The reform efforts underway in Congress are intended to address several points of weaknesses, including gaps in the coverage of systemically important firms and the absence of a resolution process for an orderly wind-down of failing firms. In addition, regulatory standards are being reevaluated to strengthen capital and liquidity requirements and to improve the risk capture of those standards. The crisis also revealed weakness related to specific financial markets involving structured products, housing-related GSEs, over-the-counter (OTC) derivatives, triparty repo and money market mutual funds. Reforms are underway in each of these areas.

Deposit accounts have increased from 19,738 deposit accounts per 10,000 adults in year 2000 to 29,311 deposit accounts per 10,000 adults this year. Similarly, there has been significant increase in loan accounts from 3,105 loan accounts per 10,000 adults to 8,600 loan accounts per 10,000 adults. More than 80% of our adult population have some form of deposit accounts. The ranking by World Bank’s Consultative Group to Assist the Poor shows that Malaysia is in the 20th position globally, [Singapore is in the 16th position; Thailand: 33rd; Indonesia: 70th; and the Philippines: 71st]. While we have made considerable progress in improving financial inclusion agenda, the Bank is unrelenting in our aspiration to shape our financial system to be more inclusive and effective in supporting a balanced economic growth for our country. Our financial sector Blueprint that will chart the direction of development of our financial system in the next ten years places a high priority on the financial inclusion agenda. Among the areas of focus are the development of cost efficient delivery channels that will enhance the outreach of financial services, expand the range of products and services to meet the distinct financial needs of the underserved and strengthen the institutional arrangements to enhance the capacity of providers of such financial services. Equally, important will be the attention accorded to financial consumer education and protection in which the standards of consumer care are high and consumers have choices and are confident about making their financial decisions.
This will therefore involve balancing the trade-offs and managing the risks to the different interests of the different segments of society. Sixth, is a skill that is increasingly important in the current environment. It is the management of crisis. Unlike previously, when conditions were relatively stable, the current environment is  2  BIS central bankers’ speeches  frequently plagued by crisis. During such times of distress and instability, the public sector is at the forefront in providing a response, in providing a solution to the crisis. In making decisions, during such times, any delays, inaction or wrong policies can produce widespread damage to the entire country. Seventh, is the ability to effectively manage under intense pressures. Such pressures can emanate from the high expectations of the different stakeholders, the crisis conditions or from the failure of other parts of the public sector that have implications on your performance. However, being strategically focussed and having the ability to stay on course avoids being derailed by such pressures. Eighth, is then courage and bravery to undertake the responsibilities. At the extreme it requires having nerves of steel. This is to enable sound decisions at the time of high level of distress and ensures that the organisation remains calm and cohesive during such times. Ninth, is having the drive and unwavering perseverance to pursue the vision. The agenda of public sector which is to ultimately improve the well being of its citizens is a long haul business which therefore requires perseverance.

The challenge is to recognise continuous reinvention that is needed – to acquire new knowledge, new skills, new experience so as to be able to have the new capabilities to deal with the new challenges. For a woman who is a mother, wife and daughter, the sacrifice involved is great. The challenge will be to achieve a balance so that work performance is not being adhered at all cost. Support systems at the work place and at home is vital. Equally important is time management, stress management and people management. Finally, more so in the public sector – as the pressures come from several fronts given the far reaching and wide spread implications of the actions taken, leadership positions require a high level of courage and endurance. Having strategic focus and energies aligned to achieving the results reinforces the ability to cope under such pressures. Conclusion Let me conclude my remarks. The demands that leadership in the public sector entails is immense. Such leadership is about delivering results and making a difference in the lives of others. To achieve this, there needs to be a conscious need to reinvent ourselves to be able to rise to the imperatives of duty to the nation. This reinvention involves leadership, institutional and organisational capabilities to respond to the changes in the environment. It is with these transformations that we are set to successfully lead. While women are a growing force in the talent pool, the real power will be a shared power.
That said, many countries within the zone also have had to make sharp fiscal adjustments and implement significant structural reforms. Unfortunately, many of these structural reforms may have a transitory deflationary impact. This is the case of product market reforms, which directly target lower prices, but also of reforms fostering supply if demand is depressed. Enhanced competition in telecom led to an impressive decrease in prices: in France, the entrance of a fourth mobile phone operator led to a decrease in mobile costs by a quarter and a negative impact on the average CPI of 0.3 point in 2012. There have been similar disinflationary effects in many of the so-called stressed jurisdictions of the euro-zone. However, at the current juncture, structural reforms are badly needed due to the productivity slowdown and larger product and labour market reforms should be envisaged in highly regulated countries. 13 In that case, it is crucial for the central bank to anchor inflation expectations, through a clear commitment to its inflation objective. The Governing Council has been clear that it is willing to do everything within its mandate to deliver on this objective which is headline inflation close to, but below, 2% over the medium term. Structural reforms can also have a short-term negative impact on employment and growth, especially in a depressed environment 14. In that respect, monetary policy can provide an offsetting support to growth, along with fiscal policy.

95  5 4  Ja n . 9 7  Ja n . 9 9  Ja n . 0 1  Source: Ecowin SG Kommunalbanken, 30.august 2002  The interest rate on private debt securities is heavily influenced by the interest rate on comparable government securities. Private issuers have to pay a somewhat higher interest rate than the government because they have a lower credit rating. Another factor is the liquidity of the debt instruments. The rate differential between government securities and private debt securities therefore consists of both a credit risk premium and a liquidity premium. Normally, the larger and more developed the market is, the lower the liquidity premium is. The financial position of local government in relation to the central government ensures that there is little or no credit risk linked to the bonds issued by Kommunalbanken or municipalities. Because of the liquidity premium, however, Kommunalbanken and the municipalities would benefit from a more developed and more liquid bond market in Norway. 6  BIS Review 48/2002  I can find several reasons why the Norwegian economy would benefit from a larger portion of credit being channelled through the debt securities market. • A well developed debt securities market: - Enhanced risk management - Continuous pricing of risk reduces the possibility of shocks  - Provides the financial system with two legs to stand on  SG Kommunalbanken, 30.august 2002  a)  Enhanced risk management  Bonds and short-term issues are traded in the secondary market.