samchain/econo-pairs-v1 huggingface dataset:
Thus, a policy that maintains medium-term inflation expectations in line with our inflation objective is most consistent with our mandate.8 Second, at the zero bound, the ability to provide credible forward guidance – both in terms of the future path of the policy rate and the future path of the balance sheet – becomes the predominant vehicle by which a central bank’s actions affect financial market conditions. If this expectations channel did not work, then it would be very difficult to provide additional monetary accommodation because short-term rates cannot be reduced materially. In the U.S., in recent months we have communicated that short-term rates are likely to stay very low for a long time; our balance sheet is likely to increase further in size and then stay large for a long time; and that we will not be overly hasty in tightening monetary policy once the recovery gets well established. By doing this, we are influencing expectations about the likely future path of short-term rates and the interest rate term premium. By utilizing the expectations channel in this way, we have been able to make policy more accommodative and generate easier financial market conditions. Good communication is essential To manage expectations well, both credibility and good communication is essential. This means explaining clearly the policy framework, the relationship between the use of tools and the central bank’s mandated objectives at the zero bound, and how the use of these tools will evolve with changes in the outlook. In this regard, a central bank’s credibility is crucial.

We applied what we understood to be the lessons from Japan, though with hindsight, perhaps not in every respect as completely as we could have. In particular, Japan’s experience reinforced the lessons of the Great Depression here in the U.S. and made us sensitive to the disinflationary force of an asset price bust and financial  4  However, research suggests that the purchases did reinforce the forward commitment. See, for example, “Policy commitment and expectation formation: Japan’s experience under zero interest rates” Kunio Okina and Shigenori Shiratsuka North American Journal of Economics and Finance, Vol 15, No 1, pp 75–100. 5  See, for example, “Deleveraging and Monetary Policy: Japan Since the 1990s and the United States Since 2007”, Kazuo Ueda, Journal of Economic Perspectives, Vol 26, No 3, Summer 2012, pp 177–202. 6  Some commentators prefer the term “North Atlantic financial crisis” as the failure and near-failure of financial institutions was concentrated in the U.S. and Europe. However, the crisis was global in the sense that financial markets transmitted the shock throughout the world and this resulted in a severe global economic downturn. BIS central bankers’ speeches  3  crisis. We recognized that we had to be very aggressive to prevent deflation and deflation expectations from becoming well entrenched. The Federal Reserve reduced short-term interest rates to nearly zero by late 2008 – a little over a year and a half after the initial shock hit in August 2007.
Ida Wolden Bache: The policy rate has been raised to bring down inflation Introductory statement by Ms Ida Wolden Bache, Governor of Norges Bank (Central Bank of Norway), at the press conference following Norway's announcement of the policy rate, Oslo, 4 May 2023. ***  Accompanying charts to the speech Chart 1: Policy rate raised by 0.25 percentage point Norges Bank's Monetary Policy and Financial Stability Committee decided to raise the policy rate by 0.25 percentage point to 3.25 percent. Norges Bank's task is to keep inflation low and stable. The operational target is inflation of close to 2 percent over time. We are also mandated to help keep employment as high as possible and to promote economic stability. Chart 2: Inflation is too high Inflation is now markedly above the target. In March, consumer prices were 6.5 percent higher than one year earlier. High energy prices are a key driver of inflation, but other goods and services prices have also risen rapidly. Price stability is crucial for maintaining a well-functioning economy. The policy rate is being set with the aim of bringing inflation back to the target of 2 percent. At the same time, we want to avoid a slowdown in economic growth beyond what is necessary to tackle inflation. We have not yet seen the full effects of our past rate hikes. Our March forecasts indicated a policy rate increase to around 3.5 percent this summer.

Wage growth last year was the highest since 2011, with a further rise expected this year. The outcome of this year's wage settlement so far suggests that annual wage growth will be slightly higher than we projected in March. Higher wage growth means higher business costs and could lead to higher prices for domestically produced goods. The krone depreciation will generate higher costs for imported goods ahead. Chart 6: Further rate rise likely in June The Committee assesses that a higher policy rate is needed to dampen inflation. Since the publication of our March projections, overall economic activity has been broadly as expected. Excluding energy prices, consumer price inflation has also moved as projected. Higher wage growth and the krone depreciation will contribute to keeping inflation elevated ahead. If the krone remains weaker than projected or pressures in the economy persist, a higher policy rate than envisaged earlier may be needed. The future policy rate path will depend on economic developments, but we will most likely raise the policy rate again in June, at which time we will also present updated forecasts for the Norwegian economy. 2/2  BIS - Central bankers' speeches
One example of the work done so far is the agreement in September on the Basel III framework, which in brief entails raising the requirements regarding the capital and liquidity that the banks are required to hold. I will return to the subject of regulations and supervision later. The crisis has raised questions regarding the functioning of the economy But crises also raise more fundamental questions regarding the way the economy functions in different respects. Are the economic relationships really as we believed them to be, or have our theories and models missed something? Could there be a reason to begin thinking differently? These types of question are often much more difficult to answer. It usually takes years of practical experience and theoretical and empirical research before one can draw conclusions with any reasonable certainty. But it is quite clear that the crisis has brought to the fore a number of interesting questions. I intend to take up three areas, which I believe will be discussed in the coming period, both in the central bank world and in academic research. What these all have in common is that, in one way or another, they affect the monetary policy transmission mechanism, that is, the way the central bank’s policy rate decisions affect the economy.

Although the central bank is acting in an apparently natural manner, in accordance with an inflation targeting policy, it may unintentionally contribute to a future crisis. The risk-taking channel can thus be said to form a link between monetary policy and financial stability. …that consists of different sub-channels The risk-taking channel actually consists of several sub-channels. One channel is that low interest rates can create incentives for investors to seek higher risk investments with a higher expected rate of return – what is known as a “search for yield”. This could involve, for instance, abandoning government bonds in favour of more risky, but higher-yield commercial paper during periods when the interest rate is particularly low. One reason may be the hope of attaining the same nominal yield as in earlier periods with higher interest rates. Another, more indirect channel is linked to low interest rates contributing to raising, for instance, the value of assets and collateral, as well as income and profits. This can in turn affect the banks’ assessments of, and tolerance to, risk. 4 Low interest rates could mean, for  1  Paul Krugman and Robin Wells, “The Slump Goes On: Why?” The New York Review of Books, September 2010. 2  See, for instance, John B. Taylor, “The Financial Crisis and the Policy Responses: An Empirical Analysis of What Went Wrong”, NBER Working Paper Series No. 14631, 2009.
The new global landscape of growing cross-border financial flows between regions that have national and cultural differences also underscores the need for enhanced recognition and understanding of practices in the different jurisdictions. This imperative translates into high demands on the use of standardised documents and agreements among Shariah compliant financial market players. Standardised documents and agreements increase market efficiency, transparency and uniformity, as well as reduce the cost of transactions as we strive towards seamless global interlinkages. The fourth prerequisite is the catalytic role of Shariah scholars in expanding cross-border Islamic financial transactions. Given the prominence of Shariah in the industry’s advancement, greater internationalisation will require the capacity and capability of Shariah scholars in offering practical solutions to Shariah issues faced by various global participants. Equally important is the efficiency and agility of Shariah scholars in responding to these matters. This calls for continuous discussions and active dialogues involving scholars across the globe. Of importance is also the need for mutual respect and common understanding within the international Shariah fraternity to enable productive and effective deliberations that will facilitate cross-border businesses. Many can indeed benefit from learning and leveraging on these country reports. To better disseminate the information, an idea is for the IDB Regional Office here in Kuala Lumpur to act as a focal point for member countries seeking further information or clarification on the reports. As a measure to further develop Islamic finance, the Regional Office can also expand its scope to include capacity building programmes for member countries.

Investment plans for 1997 appear to be less ambitious on the whole compared with capital spending plans at the same period in 1996. Nevertheless, the business leaders polled in January were more confident about future activity than they were a few months earlier. This could mean that previously postponed investment plans may be implemented in the coming months. However, plans for increasing output capacity remained few and far between, owing to the spare capacity currently available, and depend on stronger growth in demand. Retail sales in January were up markedly over December 1996, and only slightly down on the exceptionally high level recorded a year earlier. Employment levels remained stable in nearly all industrial sectors. They showed only a slight change in the services and retail sectors, but there were further falls in the building industry. BIS Review 23/1997
There has also been a noticeable pickup in multi-family construction in both New York and New Jersey this year. However, the New York Fed’s measures of regional credit conditions suggest continued financial challenges for families here. Data that we just released for the third quarter of 2012 show that for those individuals with a credit report, average debt per person in New Jersey was about $ and about $ in the state of New York. Overall debt per person peaked in 2008. Although balances nationally have fallen by over 11 percent, consumers in New York and New Jersey have brought down their indebtedness more moderately, by 5 percent and 6 percent respectively. While the overall delinquency rates are decreasing nationally, delinquent balances in our region have remained stable or even increased a bit. In both New York and New Jersey, nearly 9 percent of balances are 90 or more days delinquent, higher than the 6.5 percent national rate. Although there are some recent signs that home prices are starting to firm, the housing crisis continues to take a toll on our homeowners. Delinquency rates on mortgages, at 9.4 percent and 9.7 percent in New York and New Jersey, respectively, remain considerably higher than the 5.9 percent national rate. Before discussing the national outlook let me talk briefly about the possible effects of “Superstorm Sandy” on the U.S. and regional economy. The damage and disruptions from the storm appear more extensive and longer-lasting than first anticipated.

François Villeroy de Galhau: Special address on the French National Strategy for Financial Education Speech by Mr François Villeroy de Galhau, Governor of the Bank of France, at the 4th OECD/GFLEC global policy research symposium to advance financial literacy "Addressing the needs of youth", Paris, 24 May 2017. * * * Accompanying slides. Your Highness (Queen Máxima of the Netherlands), Mr. Secretary General, ladies and gentlemen, I am delighted to be here with you today for this symposium on financial literacy. Indeed, French citizens have high expectations about financial education: [slide 2] 78% believe that financial literacy should be taught at school and 65% believe that access to it would reduce overindebtedness and financial vulnerability.1 Academic research by Annamaria Lusardi and Olivia Mitchell2 confirms its importance, as does our own research in France3 [slide 3]. If we consider the three "standard" questions used to assess awareness of interest rates, inflation and risk diversification, only 30% of those surveyed answered all three questions correctly, which is lower than in other European countries. Furthermore, in France some of the worst results were obtained by the youngest age group, as well as the oldest. However, there is more at stake: this represents a challenge for democracy. Providing our fellow citizens with the keys to understanding complex economic debates is a matter of respect.
In this context, Islamic finance has become a new vehicle contributing to increasing the financial linkages within Asia thereby facilitating cross-border allocation of capital in the region. However, it not only has a potential role in strengthening integration and linkages within Asia, but also more importantly in forging linkages with other dynamic emerging regions such as the Middle East. Several economies within Asia are now beginning to participate in these trends thus strengthening further economic and financial linkages between these two dynamic growth regions. This enhanced inter regional linkages between Asian and the Middle East has created an environment of activity reminiscent of the Old Silk Road. This suggests that a New Silk Road has emerged in which financial services providers across continents now operate on this new route. While the New Silk Road reflects the linkages between Asia and the Middle East, the Silk Road has always been extended to the rest of the world. There is thus the potential for greater participation by global investors and the international financial community. BIS Review 121/2007  3  Islamic finance essentially presents value propositions for both investors and issuers in the respective markets, in particular, the sukuk market. For investors, Islamic financial products offer portfolio diversification and new investment opportunities in the form of new asset classes. For issuers, Islamic finance allows access to a new source of funds and liquidity besides providing, new risk management options and new mechanisms for price discovery.

But nowadays, London's role depends mainly on making markets and providing financial services in foreign currencies, like the dollar. That means that London continues to thrive only by remaining internationally competitive. And I should add that we in the Bank of England take a close interest in this. Maintaining the stability of the financial system and the effectiveness of the UK's financial services are key objectives for us. The City is a centre of innovation and excellence London is internationally competitive, because it acts as a centre of innovation and excellence, in a whole range of complementary ways. •  London has a vast, critical mass of markets and financial services in commercial and investment banking, securities and derivatives, fund management, insurance and commodities. •  London has a long track record of innovation, and a ready availability of financial skills and professional support services in law, accountancy, tax, property and communications. More than 300,000  •  people work in financial services in London, and nearly a further 600,000 work in the supporting professions and services. •  London is at the forefront of technology, with an effective financial infrastructure. •  London has a reputation as a 'clean' market, and it has a commitment to openness in welcoming foreign firms. There is a genuinely level playing-field for foreign firms, with no overt or covert advantages given to domestic institutions. •  And in London, we have a non-bureaucratic but rigorous approach to regulation.
Hence, the offered exchange rate is generally unattractive, and visitors will almost always be better off converting their money at a bank or using their credit cards. Historically, parallel currencies have only prevailed in those countries that no longer had a sound currency of their own. As long as the SNB continues to pursue a policy that aims at maintaining price stability, the Swiss franc will remain a widely accepted and trustworthy currency. There is no reason to expect it to disappear. By contrast, the declining significance of the Swiss franc as a denomination of foreign bonds in recent years is not primarily due to the creation of the single currency. This trend had already been observable long before 1999. It can be seen as a return to a situation in which the importance of the Swiss franc is more in check with Switzerland's economic size, as compared with its former extremely over-proportional weighting as an investment currency. Certainly, the launch of the euro has not enhanced the attractiveness of Swiss franc bonds, mainly because the market liquidity of euro bonds has grown significantly since 1999. On the other hand, the Swiss franc has gained in stature simply because it is a member of the dwindling family of international currencies. For this reason, we expect it to maintain a role as an instrument of portfolio diversification. 3.2.

Against the backdrop of fear and uncertainty, banks have tightened their lending and consumers have become more cautious in their spending. This will act as a drag on the euroarea economy going forward. A key constraint for both the US and euro-area, as well as many other advanced economies, is the limited policy space available to authorities. In these countries, monetary policy and fiscal stimulus have been pushed to their limits. Limited capacity to respond to new shocks thus represents a real risk for these economies, and for the global economy, that we must be weary of. In this setting, and given the deep-seated nature of the problems being faced, meaningful remedies rest just as much on political factors as on economic ones. How governments respond and how their electorates receive these responses will be an important source of uncertainty. In contrast, the rising economies in Asia offer a more positive outlook. Despite the slowdown in exports of many Asian countries, reflecting the softer global economic backdrop, domestic demand remains robust. More fundamentally, the continued rise of China and the formation of the ASEAN Economic Community (AEC) will generate enormous economic opportunities for the region. As will be discussed later, the key challenge for Thailand will be how to optimally position ourselves to reap the full benefits of this trend. This brings me to the internal challenges.
Let me go over some of the reasons why we chose this path. The euro area crisis, and in particular the more acute episodes of banking turmoil, revealed a number of basic weaknesses at the heart of the monetary union. i)  First, the problems encountered by some of the big banks severely damaged the fiscal stance in certain countries, where the state had to step in to save these banks. This, in turn, undermined market confidence in the sustainability of the resulting fast growing public debts, which led to sharp rises in the rates at which those countries could borrow on the market, as, for example, in the case of Ireland. ii)  Second, there was a perception that countries with impaired public finances would have difficulty bailing out their respective financial systems in the event of a problem. This resulted in a widespread loss of confidence and pushed up borrowing costs for banks and sovereigns, as in the case of Italy. iii)  In response to these tensions, the European Central Bank took unprecedented steps to lower the cost of bank refinancing, cutting its key policy rates to historically low levels and providing unlimited 3-year liquidity. But even this proved insufficient to calm market tensions. In some countries at least, monetary policy measures were simply not being fully transmitted to the real economy. What was the reason behind these three phenomena, which were largely responsible for the escalation of the crisis in the euro area?

In other words, the goal is to ensure that credit conditions in the euro area will not depend on where you are but on who you are, which is what should be expected of an efficient financial market. To achieve this, we need to have three things in place: i)  Federal bank supervision, to guarantee that all institutions are subject to the same rules and same methods of control. A supra-national supervisor is in fact better placed to assess the risks of cross-border activities and therefore to protect and encourage such activities; it is not subject to national biases that can lead to the temptation of economic introversion. It is therefore more credible and strengthens stability and confidence in the area;  ii)  A unified mechanism for the resolution of banking crises, so that individual countries no longer have to shoulder the burden of major upheavals on their own;  iii)  A unified deposit-guarantee mechanism to avoid banking panics. Over the past year, these ideas and words have translated into concrete actions, and Europe has demonstrated that it can carry out rapid, in-depth reforms, to ensure it emerges stronger from the crisis. I would just like to tell you where we stand currently in the move towards banking union. As you know, the area in which we have made the most progress is in supervision.