samchain/econo-pairs-v1 huggingface dataset:
15  “The G20 Seoul summit leader’s declaration November 11–12, 2010” and IMF Global Financial Stability Report, 2011. BIS central bankers’ speeches  7  Figure 4 Sweden’s current account Percentage of GDP 10  10  8  8  6  6  4  4  2  2  0  0  -2  -2  -4  -4 80  82  84  86  88  90  92  94  96  98  00  02  04  06  08  10  12  Source: The IMF  There are many possible explanations for the large surpluses. As I have already mentioned, the current account surplus is due to the fact that domestic saving is higher than domestic investment. In Sweden, household saving increased following the economic crisis in the early 1990s, which may partly be because the tax reforms implemented at that time made it much more profitable for the households to save. The fiscal policy framework also led to an increase in public sector net lending. The pension reform of 1994 was probably another factor that contributed to the increase in household saving as future pension payments were linked more strongly to how much was paid into the system. Sweden also has an ageing population so one could claim that saving should be high to enable us to cope with increasing pension costs in the future. 16 But this applies to most of our trading partners too.

The effective exchange rate index measures how the currency relates to a basket of other currencies that are weighted in terms of their relative importance to trade. The real index is also adjusted for relative differences in the CPI. A downward movement in the figure entails a strengthening of the exchange rate. Source: Reuters EcoWin  This put some emerging economies with a floating exchange rate in an awkward position as they did not want to lose too much competitiveness in relation to China while at the same time large capital inflows tended to strengthen their exchange rates. The G20 has now agreed that in certain situations it may be justified to introduce temporary capital regulations to protect against volatile capital flows. The view is that in normal cases a country should use monetary or fiscal policy, or tools for macro prudential supervision, but that in exceptional cases it may be appropriate to introduce measures to control capital. Work is underway to set up common guidelines. 15 Why does Sweden have such a large current account surplus? Prior to the crisis of the 1990s, it was usual for Sweden to have current account deficits for long periods of time (see Figure 4). After the crisis the krona weakened substantially at the same time as the deficit became a surplus. Since then, Sweden has not only had a surplus, it has had a very substantial and, to a certain extent, a growing surplus.
My outreach trips complement the ongoing efforts of the New York Fed to assess conditions in the upstate New York economy and throughout our District. We monitor economic performance on a monthly basis through our indexes of economic activity and our survey of New York State manufacturers. We also get important input on economic conditions from meetings with our Upstate Advisory Board, whose members are major leaders in the upstate economy. We have constructed a consumer credit panel that allows us to better understand the financial condition of homeowners and students, and conduct a bi-annual poll of small businesses to understand their credit needs and availability. The results of the latter have helped inform a series of clinics that we have conducted to help small businesses take the next step to access capital and identify new sources of funding. As I mentioned earlier, we are always eager to engage with students, and our commitment to our region includes a series of educational programs worth highlighting. First, Math x Economics, which encourages students attending Title 1 schools to consider preparing for a career in finance or economics. And, second, our yearly Fed Challenge competitions, in which teams of students from high schools and colleges in the District take on the roles of the members of the Federal Open Market Committee (FOMC) and debate what is the appropriate next step for U.S. monetary policy. All in all, there is a lot to keep myself and my colleagues fully engaged with the communities we represent.

Should such barriers actually be introduced, there would be a negative impact on world trade that could affect an economy, like Spain's, whose recovery has been largely export-led. In the same vein, uncertainty about the implications of the United Kingdom leaving the EU remains high, in a setting in which the Spanish economy has significant exposure to this country in terms of services exports and financial ties. This uncertainty is also affected by the context of low returns in Europe's financial system and of the fragility of certain institutions. On the domestic front, several factors of vulnerability persist. One of them arises from the level of public indebtedness (which I will refer to later) and that of certain segments of the household and corporate sectors, which entails high reliance on foreign saving and represents a source of weakness in the face of possible increases in the cost of borrowing. Also, despite efficiency improvements, our economy remains highly sensitive to potential increases in commodities prices, particularly, oil prices. From a medium-term perspective, the high structural component of the unemployment rate, an ageing population and low productivity are the main factors limiting the sustained growth of our economy. I shall now review the main features of the budget. Budgetary policy in 2017 The macroeconomic forecasts accompanying the draft State and Social Security Budgets for 2017 involve the prolongation of the current expansionary phase. Specifically, they estimate real GDP growth of 2.5%, accompanied by a recovery in prices, so that nominal GDP growth is slightly above 4%.
If this estimate is correct, it would mean that the majority of today’s reserves are unusable and thus have no economic value. The assets have, in other words, become “stranded”. Oil and gas companies are major borrowers on international bond markets and a rapid transition may therefore create financial risks and instability. For banks, the value of collateral can fall and credit losses can rise, which could reduce their capital, impair liquidity and thus weaken the banking system. The insurance sector is related part of the economy that may be hit hard by a rapid transition. Tighter insurance requirements and increased liability could have a very adverse effect on the insurance sector. We can already see that it has become more common for insurance companies not to insure certain climate risks. Figure 2 also provides a description of how the effects of transition risks may spread to the financial sector and threaten financial stability.5 Figure 2. Physical risks and transition risks affect financial institutions and hence financial stability. PHYSICAL RISK  Gradual global warming  Extreme weather events  TRANSITION RISK  Adaptation to less fossilbased economy  Climate taxes  Tougher regulation  Changed consumption patterns  COMPANIES, AGRICULTURE AND HOUSEHOLDS Lower productivity Falling asset prices Lower profits  FINANCIAL INSTITUTIONS   Tighter insurance requirements  Investment losses  Credit losses   Increased risk weights  Source: Danmarks Nationalbank (2019)  Third, I would like to highlight the risk of extreme outcomes, so-called threshold effects.

We will be able to take a deeper insight into the economic growth slowdown after detailed GDP statistics are released. However, the 2018 data released in April and preliminary Q1 2019 estimates allow us to update our GDP forecast for this year. In particular, the revision is associated with lower export growth rates and a tempered outlook for growth in the global 1/3  BIS central bankers' speeches  economy and external demand. We have left the forecast for consumer and investment demand unchanged in view of the expected rise in public expenses in the second half of the year. As a result, we have updated the 2019 economic growth forecast from 1.2-1.7% to 1-1.5%. Third. Proinflationary risks have declined over a one-year horizon. First, we no longer expect any deferred effects of the VAT hike. Second, the US Fed consistently eased it rhetoric since the year start amid the expected slowdown of global economic growth. All else being equal, this constrains the risks of considerable capital outflow from emerging markets. In March-April, we noticed that the risks of accelerated growth in prices of certain food products diminished. Overall, they remain moderate, though current food inflation was somewhat higher in May than in the previous three months, seasonally adjusted. Moving forward, we expect that record crop areas, early spring, and overall favourable weather will bring a good harvest of vegetables, grains and other crops. Domestic and global grain prices have been down since the beginning of the year. This contains proinflationary risks for food products.
The multinationals and multi-lateral institutions such as the International Finance Corporation and the International Bank for Reconstruction and Development has begun to tap the fund from the Malaysian capital market by issuing ringgit sukuks, thus increasing its depth and diversity. The Malaysian private debt securities market including the conventional market has become the second largest market in Asia. The economic and financial linkages between Asia and the Middle East are growing. While the world trade has on the average expanded by 10% over the period 2001-2005, Asia's trade with the Middle East has increased on the average by 24%. More than half of the exports from the Gulf states goes to Asia and more than one-fifth of its imports are from Asia. While the US remains the major recipient of investment flows from the GCC, Asia has surpassed the Euro region as the second most popular investment destination. Malaysia is well positioned to provide the linkages through Islamic finance to support the flow of this kind of investment. We have put in place a comprehensive Islamic financial system that includes the legal, Shariah and regulatory infrastructure, supported by a diversity of players and a wide range of products and services. Our capital market has depth and breadth that is supported by an active secondary bond market.

Mohd Razif bin Abd Kadir: Economic outlook and business opportunities in Malaysia Opening remarks by Mr Mohd Razif bin Abd Kadir, Deputy Governor of the Central Bank of Malaysia, for Malaysia Country Showcase at the IFSB Summit: "Economic Outlook and Business Opportunities in Malaysia", Dubai, 14 May 2007. *  *  *  I would like to welcome you to the Malaysia Country Showcase held in conjunction with the 4th Islamic Financial Services Board Summit. On behalf of the Malaysian delegation, I wish to thank you for your presence here on this important occasion as it gives us an opportunity to share the Malaysian business proposition and to nurture strong trade and investment ties in the region. We are fortunate to have with us distinguished panel of experts who will be engaging in an interactive discourse. Today's forum provides a platform for greater awareness of the economic climate and outlook as well as the business potentials and opportunities in Malaysia. A decade after the financial crisis, the Malaysian economy including the financial system is at its strongest position. Malaysia has greater economic flexibility to shift to new areas of growth and thus sustain the development momentum. Economic growth has been achieved with relative price stability, low unemployment and strong external balances. The level of savings remains high at 37 percent as a percentage to the GDP and the level of external reserves remains strong at USD91 billion.
Legislation to enable the IBC proposals was passed in 20138. The benefits from separation are several. Retail deposits tend to be a cheap source of funding. In part that is because retail deposits are protected up to a limit by statutory guarantee – so they tend be safe, and sticky. Banks that have a range of activities would have an interest in using cheap, protected retail funding to engage in its most risky activities – for which direct funding is likely to be much more expensive. Furthermore, historically, banks with large retail activities have also been viewed by credit rating agencies to have a large degree of implicit government support thus making their public debt issuance cheaper as well. The funding advantage from being seen to be “too big to fail” has been estimated from a range of studies to be equivalent to a subsidy on the scale of hundreds of billions of dollars globally,9 encouraging and enabling greater risk-taking by firms than true costs of funding would justify. Separation also means that the structure of firms is simplified and hence they would be easier to resolve if necessary. The EU more generally is still deciding on its precise approach to structural reform, although the Liikanen report (2012) took a slightly different approach from the IBC.

Capital markets could go through a process of progressive and partial fragmentation: no significant capital account opening would occur in many parts of the world. Conversely, new barriers could be erected either in the form of “soft” capital controls or through national regulations forcing financial institutions to ring‐fence local pools of capital and liquidity. There would be little convergence in domestic financial systems and regulations. Foreign exchange reserves would keep growing, both in absolute terms and as a percentage of world GDP. This scenario may be seen as the only realistic response to increased diversity in a multipolar world. The systemic consequences, however, are not clear. In such a world,  BIS Review 127/2010  3  current account imbalances would be heavily influenced by public actions and policies. Regulatory competition would determine the location of financial activities and the allocation of savings. In the absence of some “rules of the game”, tensions would naturally arise between countries regarding many aspects of their domestic and international macroeconomic policies. The opposite scenario would involve the progressive opening of all capital accounts, together with some (more or less intensive) convergence in financial systems and regulations. This would allow for the emergence of a unified world capital market, an efficient allocation of savings across countries and a smooth financing of current account imbalances. Experience shows, however, that an open international financial system is not inherently stable and, therefore, very dependent on strong infrastructure. Two elements of such an infrastructure seem especially important.
Doing so will dampen the effects on the real economy of the policy measures that are adopted in order to return inflation to the stipulated target. Described in this way, the Riksbank’s strategy is close to the textbook treatment of flexible inflation targeting. However – and here I come to an area where the Riksbank has recently been criticized – we do also allow for taking into consideration developments in asset prices, including house prices. As explained in the policy document “Monetary Policy in Sweden” “the paths of asset prices and indebtedness can at times be either difficult to rationalize or unsustainable in the long term. This means that there are risks of sharp corrections in the future which in turn affect the real economy and inflation. …In practice, taking risks of this kind into consideration can mean that interest rate changes are made somewhat earlier or later, in relation to what would have been the most suitable according to the forecasts for inflation and the real economy.” (p. 15-16) Why is such a statement included in the Riksbank’s monetary policy strategy? Why is it for instance not sufficient to simply follow the prescriptions of the textbook account of flexible inflation targeting? This type of criticism was raised in a recent external evaluation authored by Francesco Giavazzi and Frederic Mishkin. A close adherence to the textbook account of flexible inflation targeting requires a belief that the analytical tools and models currently available have accurately captured the important linkages in the economy.

Abdulrahman A Al-Hamidy: Compliance and anti-money laundering Speech by His Excellency Dr Abdulrahman A Al-Hamidy, Vice Governor of the Saudi Arabian Monetary Agency (SAMA) ,to the Fifth Annual Gathering on “Compliance and anti-money laundering”, Saudi Arabian Monetary Agency, Institute of Banking, Riyadh, 26–27 March 2013. *  *  *  Dear Audience, It gives me pleasure to welcome you all, and I would like to thank those who have participated in the preparation for this gathering. I also would like to extend my thanks to the colleagues at the Institute of Banking and the speakers to this gathering. Dear Audience, The continued holding of this gathering for the fifth year confirms the firm conviction held by all of us of the risks that the crime of money laundering poses to the global economy. It also reflects the Kingdom’s commitment to combat money laundering, and its support of the measures taken against it, and the implementation of the best international practices in this field. The discussion of this gathering derives its importance from the increasing trend towards globalization, easing restrictions on international cross-border movement of commodities and services and the revolution of communication and information technology. Dear Audience, Money laundering operations have witnessed a quantum leap at the global level over the last years. This was reflected in the various and diversified methods used in their implementation, expanding the volume this type of crime. Developed and developing countries suffer from this crime.
Aggregates, as I have said, can hide a multitude of sins. Household debt came down post crisis in most advanced economies – falling from 83% of GDP in 2009 to around 73% today – and has grown very slowly, if at all, since, moving within a percentage point for the last five years.12  11 The Euro area is perhaps something of an exception, given that Euro members issue debt in a common currency rather than a national currency. This removes the exchange rate and inflation mechanisms for correcting debt values that can operate when sovereigns issue in their own currency and makes the adjustment mechanism of default more likely, as was seen in the Euro crisis. 8  All speeches are available online at www.bankofengland.co.uk/speeches  8  Financial sector debt in advanced economies has also grown very slowly after the very painful deleveraging of the financial sector during and after the crisis. This reflects greater risk aversion in the banking sector reinforced by the much higher level of capital banks are now required to hold against losses, a very positive development for financial stability. Corporate debt in advanced economies, however, is a more mixed story. It has not grown much overall over the past 5 years. But within that, over the past 3 years its growth rate has accelerated in some countries – particularly the US and France. And perhaps more importantly, while the totals may not be changing much, the riskiness has been increasing.

The second risk that may arise after we have left the EU, is the related but perhaps more prosaic issue of the flexibility of the UK’s regulatory framework and allocation of responsibilities within it – the division of tasks between Parliament, Government and the regulatory authorities. Much of our financial sector legislation and regulation has been made at the EU level. This has increasingly taken the form of extremely detailed EU primary and secondary legislation directly applicable in Member States.4  This approach has been justified as necessary in the EU by the need to prevent divergences between member states. The cost, however, as some have observed, is an over complex and rigid regulatory framework.5 As a preparatory step for Brexit, Parliament has ‘onshored’ EU legislation and regulation and also the allocation of responsibilities that lie behind it. At some point, post Brexit, we will, I think, need to address this rigidity and hard wiring of detail to ensure we have a coherent, effective and flexible regulatory system with appropriate accountability. How we do that will have an impact on how we address risks, at firm and at system level, in a fast changing financial system. Financial stability post-Brexit With that nod to the future, I will leave Brexit - for today at any rate – and turn to the examination question you have set for today – financial stability post Brexit. I would like to focus on the question of debt.
Instead of one tool, the policy rate, central banks now use several different tools. Previously, the focus lay on influencing the financial conditions via a short-term, risk-free interest rate that primarily affects the banks’ funding. Now, central banks also introduce measures that directly affect more long-term and even non risk-free interest rates. These too can lead to the intended effects on the interest rates and other credit conditions that households and companies face, and thereby to the desired effects on capacity utilisation and the rate of inflation. Another way of describing the menu of monetary policy measures that are now being used is that they concern both sides of the Riksbank’s balance sheet. When the policy rate is adjusted, this entails changes for a part of the Riksbank’s liabilities. 8 And when the Riksbank purchases different types of assets, this means that the asset side changes. In other words, today’s monetary policy works with the entire balance sheet. 7  Rajan (2005) is a very well-known reference. 8 In 2020, the Riksbank has also changed the conditions for other kinds of liabilities. 6 [13]  Crisis preparedness – part of monetary policy Another change is that the central banks have been reminded of the importance of not just being able to stabilise normal economic cycles but also being prepared to act rapidly and broadly to restrain the effects of crises affecting both the development of the real economy and the financial system.

Rajan, Raghuram (2005), “Has financial development made the world riskier?”, Federal Reserve Bank of Kansas City Economic Symposium at Jackson Hole. Rogoff, Ken (2020), “The case for deeply negative interest rates”, available at https://think.ing.com/opinions/the-case-for-deeply-negative-interest-rates. Sveriges Riksbank (2020), “Consultation response, SOU 2019:46”. 13 [13]