samchain/econo-pairs-v1 huggingface dataset:
47  Chart 13: UK increasingly integrated in onward EU supply chains  Notes: The chart shows how much of the value added by the UK in exports to the EU / other countries that is subsequently re-exported. Sources: Credit Suisse and World Input-Output Database (2016 release). Retaining some of these positions may be challenging as evidence indicates that trade in intermediates appears to be more sensitive to trade costs such as tariffs. Given that proximity also appears to be more important for trade in intermediates than for trade in final goods,  48  international substitutes for European  buyers of UK intermediates, as well as European suppliers of intermediates into UK supply chains, may be more difficult to source. These effects and the experience of the past 30 years prompt the question: if globalisation is disinflationary, won’t Brexit be inflationary? Certainly, this process of de-integration can be expected to steepen the Phillips Curve given disruptions to in-bound value chains from Europe and reduced contestability of UK labour and product markets. In addition, the reallocation of capital to suit new trade arrangements will take time, weighing on growth of the economy’s supply capacity while it proceeds. Moreover, any increase in tariffs on UK imports, or increases in the cost of imports due to broader access restrictions, would cause the Phillips Curve to shift up temporarily as those higher costs are passed through the supply chain. These inflationary effects may be reinforced by developments in the labour market.

So if a large share of a country’s imports is invoiced in a foreign currency, changes in its exchange rate will mostly show up in changes in the domestic currency price of imports – in other words, pass-through will be higher. For the UK, Gopinath finds that just under half of imports are invoiced in US dollars. 55 There is evidence of threshold effects in exchange rate pass-through. Pass-through of bilateral exchange rate movements that are larger than 5% is around four times larger than that of changes smaller than 5%. See Lewis, J (2016), ‘What can Big Data tell us about the pass-through of big exchange rate changes?’, Bank of England Staff Working Paper No. 579. 54  20  All speeches are available online at www.bankofengland.co.uk/speeches  20  Turning finally to the policy implications, it is critical to recognise that Brexit represents a real shock about which monetary policy can do little. Monetary policy cannot prevent the weaker real incomes likely to accompany the move to new trading arrangements with the EU, but it can influence how this hit to incomes is distributed between job losses and price rises. And it can support UK households and businesses as they adjust to such profound change. On balance, the de-integration effects of Brexit can be expected to steepen the Phillips Curve and to be inflationary. At present, the main question concerns the extent to which this adjustment has been brought forward.
Our projections are based on the assumption that fiscal policy will provide some stimulus to aggregate demand and output in 2008 and 2009, but somewhat less than a mechanical application of the fiscal rule based on our oil price assumption would imply. High growth in the global economy has pushed up prices for non-oil commodities as well. Over the past year, copper prices have more than doubled and aluminium prices have risen by more than 60 per cent. Futures prices have also risen markedly, indicating expectations of a permanent upward revision of metals prices similar to the revision of oil prices. Rising commodity prices and buoyant activity in markets that are important for Norway have fuelled growth in the Norwegian economy, even though growth has been low in some of Norway’s most important export markets. Overall, prices for our imported goods are falling in relation to prices for goods we export. Norway’s terms of trade are improving. The impact of the rise in oil and gas prices is particularly strong, but the terms-of-trade gains for the mainland economy have also been high. The domestic economy is partly insulated thanks to the oil fund mechanism. The situation in Norway differs from that of its Nordic neighbour countries. Sales of Swedish and Finnish high-tech products are growing strongly in volume terms, but prices are falling. Denmark has a diversified business sector, which is overall moving on a steady path. 4  BIS Review 41/2006  Growth among our trading partners remains solid.

Monetary policy assessments Since last summer, interest-rate setting has been oriented towards a gradual increase in the interest rate – in small, not too frequent steps – towards a more normal level. According to the assessment in the March Inflation Report, higher growth in the economy could, in isolation, warrant a faster rise in the key rate ahead. This would reduce the risk of bottlenecks in the economy, with rising cost inflation and continued debt build-up. On the other hand, the objective of bringing inflation up to the target of 2.5 per cent and anchoring inflation expectations suggested in isolation that further interest rate increases should be delayed until there are clearer signs of a further rise in inflation. The trend in prices for consumer goods over the past two or three years is a result of favourable developments in the Norwegian and global economy. The shift in trade towards low-cost countries has led to lower prices and higher real income. In addition, the changes in the world economy have provided Norway with higher income because our terms of trade have improved. Increased competition has curbed the rise in prices for a number of domestically produced goods and services. When inflation deviates substantially from the target for a period, the interest rate will be set with a view to gradually returning it to the target, so that we avoid substantial variations in output and employment. Through the 1990s, inflation generally remained in the interval 1½ – 3½ per cent.
In particular, we observed an imbalance among the key elements of the credit risk management process, with too strong an emphasis on the role of collateral to protect against credit loss. This undue emphasis caused many banks to neglect other critical elements of effective risk management, including in-depth credit analyses of counterparties, effective exposure measurement, and the use of stress testing. To make sound credit decisions, banks need to obtain sufficient information about the borrower to provide a comprehensive and timely picture of its risk profile and credit quality. This is true regardless of whether the extension of credit occurs via a loan or through a counterparty trading relationship. Yet the Basel Committee’s report found that banks did not obtain sufficient financial information to assess the types and extent of risk assumed by large, highly leveraged institutions. In particular, banks did not BIS Review 126/1999  2  obtain the information needed to assess leverage, risk concentrations in particular markets, or the liquidity risk profile of individual institutions. The Basel Committee report also concluded that banks should develop more effective measures of potential future exposure, which refers to the possibility that credit exposures can change over time as market conditions fluctuate. The ability to measure potential future exposure is critical when dealing with large trading counterparties such as highly leveraged institutions, especially in volatile market conditions. Unfortunately, methods for measuring potential future exposure have not kept pace with the growth and composition of trading activity.

BIS Review 126/1999  6  These have not been easy times for banks. As a regulator, I cannot help but underscore the essential role banks play in the global marketplace. By intermediating credit between savers and investors and providing liquidity to the financial sector, banks are the essential link in well-functioning economies. Thus, while capital levels and risk management policies are without question important, they do not take precedence over the responsibilities of bankers to serve their purpose in a Schumpeterian world of creative destruction. This most fundamental of responsibilities involves the use of credit judgment. By this I mean that bankers must not lend to excess when times seem good and then lend too little when times appear more difficult. This is an ongoing obligation of banks and is no less so as we approach the century date change. With roughly six weeks to go before year-end, I believe it critical that banks approach the new year with these thoughts in mind and I call on them to be attentive to providing for their customers’ reasonable needs. By reasonable needs, I have in mind that banks should think twice about huge demands based on what seems to be customers’ excessive concern about Y2K, but grant appropriate credit for realistic needs, even if this involves somewhat greater use of their own balance sheets than would usually be the case.
Up to the present, the full length of the bars show the actual amounts of Treasury securities and agency debt and MBS principal that matured or paid down early. Only the amounts above the cap were reinvested. As can be seen, we have delivered a gradual and predictable reduction in 7  This one day was December 31, 2015, when the federal funds rate printed at 20 basis points, or five basis points below the bottom of the FOMC’s target range. Potter, “Money Markets after Liftoff: Assessment to Date and the Road Ahead,” February 22, 2016, discusses this occasion. 8 I discussed dispersion as a means to evaluate the efficacy of monetary control and transmission in an earlier speech. These data suggest that the framework continues to perform quite well along this dimension. See Potter, “Money Markets at a Crossroads: Policy Implementation at a Time of Structural Change,” April 5, 2017. 9 See Potter, “Gradual and Predictable: Reducing the Size of the Federal Reserve’s Balance Sheet,” October 11, 2017, for a discussion of balance sheet normalization. 10 See the FOMC’s Policy Normalization Principles and Plans, September 16, 2014. 11 Statement Regarding Reinvestment in Treasury Securities and Agency Mortgage-Backed Securities, September 20, 2017. 3  the size of the balance sheet.

I see this as a reasonable possibility, and therefore I think it might be possible that the decline in reserve balances has pushed up overnight rates a bit over time. 17 At this point, I see no evidence that we are at, or close to, the “steep” portion of the demand curve. 18 Let’s run through some places where evidence of such a possibility might be found. To begin with, if we were closing in on the “steep” part, I might have expected to see more above-IOR lending in the unsecured overnight markets, as at least some banks each day found themselves short of reserves and had to borrow them from another bank. In fact, the amount of such above-IOR lending remains low as a share of the overnight bank funding market, as shown in Figure 9. 19 I might also have expected to see shifts in bank payments behavior—for example, more daylight overdrafts or more effort by banks to “optimize” their payment flows— but I have not seen this either. But, most fundamentally, I might have observed a day-to-day relationship between shifts in the stock of reserves and overnight interest rates. Figure 10 shows a scatterplot of daily changes in reserve balances against daily changes in the spread between the IOR rate and the effective federal funds rate; there is no visible relationship. 16  The classic paper on this topic is Poole (1968).
Individuals and businesses must be able to digitally access all their relevant data and make them available to third party service providers who can then serve these individuals and business in a holistic manner. This could be for purposes of financial planning, trade financing, credit scoring, etc. where data aggregation is important for more customised and comprehensive solutioning. When these foundational digital infrastructures come together, they will have the power to deliver truly end-to-end digital transactions. Take for example, cross-border digital payments. With the four foundational digital infrastructures working in concert, we can effectively tackle the big pain points in know-your-customer checks, sanctions screening, and exchange of documents, to enable cheaper, faster and secure payments. Singapore has implemented these four foundational digital infrastructures. Singaporeans can use their national digital identity – SingPass Mobile – to transact digitally with both the government and the private sector Using SingPass Mobile, Singaporeans can make available relevant verified information to allow banks to onboard them without the need for paper documentation or physical presence. Singapore’s retail payments infrastructure – FAST and PayNow – has made digital payments interoperable. Singaporeans can now move money to one another’s bank accounts in real-time and at zero cost, with just three clicks on their mobile phones, regardless of which bank app they use. The Singapore Financial Data Exchange – SGFinDex – is a pioneering data exchange platform, the first of its kind in the world.

At the same time, the SSM will develop its own more detailed supervision manual, which lays down the supervisory approach to be taken by the SSM including on off-site and on-site reviews, risk assessments and model validations. The ECB and the EBA are cooperating closely to ensure that these two projects are fully consistent. Here again, the existence of the SSM will greatly facilitate the work of the EBA, as all SSM members will naturally converge in their supervisory practices. Third, the conduct of stress tests. The Council Regulation requests the SSM to conduct a comprehensive assessment of the banks that the ECB will supervise directly. This will have two main building blocks. First, a balance sheet assessment, which is a point-in-time evaluation of the asset side of banks’ balance sheets. Second, a forward-looking assessment of individual banks’ capital positions and provisioning levels in the form of a stress test. This stress test, and future stress tests undertaken as part of the SSM’s regular supervisory functions, will be conducted in close cooperation with the EBA, in particular regarding the design and timing of the exercises. European Systemic Risk Board As regards interactions with the European Systemic Risk Board (ESRB), the activities of the SSM will have a clear systemic dimension and so cooperation between the SSM and ESRB will be essential.
6  BIS central bankers’ speeches  However, even enhanced recovery tools may not be enough to prevent the CCP from being resolved, first of all because it is impossible to estimate ex ante the size of potential uncovered exposures, secondly because under certain circumstances it might be preferable to resolve a CCP – especially if the market has lost confidence in this CCP as a going concern. Effective CCP resolution as an ultimate tool. Lastly, we need to assess whether more assurances are needed so that a CCP can be effectively resolved and can re-launch its viable operations, and whether the measures discussed before are either ineffective or out of line with market preferences. Much like recovery frameworks, CCP resolution frameworks are currently being designed and implemented across jurisdictions. The FSB is reviewing CCP resolution regimes and resolution planning arrangements. Based on this review, it may develop minimum standards for CCP resolution planning, strategies and tools without resorting to a government bailout, and without resulting in contagion to other parts of the financial system. Meanwhile, the European Commission is preparing specific EU legislation. If, after an in-depth assessment, authorities come to the conclusion that an additional source of financial resources is needed, what form should these extra funds take? Let me first reiterate that any bailout of CCPs with public money should be categorically excluded. Resolution plans should fully allocate losses to CCPs and their participants.

Six long-term scenarios, that is to say with a 2050 horizon (and even the end of the century for some variables), have been developed and will continue to evolve under the aegis of the Network for Greening the Financial System (NGFS) iii [slide 3 for a focus on 3 scenarios], to whose 144 institutions the Banque de France provides its global secretariat. The current scenarios, which are consistent with the various physical scenarios of the IPCC, will soon be supplemented by a seventh scenario of “net zero 2050” achieved through greater energy sobriety; the publication of the updated NGFS scenarios is expected next autumn. In their current version, they are already used by a great number of supervisors – the majority of the 36 jurisdictions that  Page 4 sur 8 have conducted a climate stress test (for instance France, the EU, the UK and the US). Our pilot stress tests also pointed to a need for shorter-term scenarios with a five-year horizon as the transition is accelerating: the NGFS is currently elaborating on them by leveraging the work of its Members, including by Banque de France researchers iv. We at NGFS will publish a conceptual framework at end of this year, and are aiming to release a first vintage of these short-term scenarios by the end of 2024. In particular, they should display more adverse developments, and incorporate tougher shocks. They should also be tailored to explore the potential impacts of climate change, not just on activity but also on inflation.
It is noticeable that countries, such as Korea, which possessed very important amounts of  BIS Review 76/2010  7  reserves prior to the crisis and has a flexible exchange rate regime, nevertheless felt the need to enter into currency swaps with the Federal Reserve. Financial openness and integration means that domestic banks will engage more and more into foreign currency operations. In turn, the expansion of international balance sheets will increase the potential demand for liquidity support in case of shocks. This trend should be accepted as a normal consequence of open capital markets and international banking, together with the predominance of a very limited number of currencies in international finance. As a consequence, past benchmarks used to assess the adequacy of reserves are no longer valid. Current research (Obstfeld et al. 2009) shows that broad domestic money aggregates may be the best explanatory factors for the amount of reserves. Internationalisation of finance has created a fundamental indeterminacy in the demand for reserves, which reflects the indeterminacy in the demand for liquidity. Multilateral provision of international liquidity: the search for financial safety nets The rationale for a multilateral source of liquidity provision is straightforward: stabilizing the demand for international reserves would bring huge benefits in terms of world welfare. At the moment, reserve accumulation can only occur through a conjunction of balance of payment surplus and some degree of exchange rate intervention. In addition, if sterilization proves difficult or impossible, it also leads to unwanted changes in monetary policy.

In an attempt to widen this platform for information sharing and dissemination, we have once again embarked on a radio programme, which will discuss topical issues such as: •  Exchange rate movements;  •  Cost of banking services;  •  Developments in the payments system;  •  Micro finance regulations;  •  Currency awareness; and  2  BIS Review 55/2007  •  Establishment of credit reference services, to name a few. These issues affect all Zambians and it is our duty to be able to discuss them through a wider forum, such as radio to which the majority of our people listen. The Bank also intends to conduct provincial sensitisation visits and to localise these visits by way of disseminating information in local languages and dealing with matters, which are peculiar to those provinces. Governor, kindly give your closing remarks It is our hope and desire that through this information dissemination programme and other similar interventions, we shall increase the public’s awareness on the role of the Bank of Zambia in the economic development of this country. It is my honour to launch this information dissemination programme and I urge you all to listen in and actively participate in the live phone-in programme, which we will hold at the end of the radio programme. I thank you. BIS Review 55/2007  3
Lim Hng Kiang: The Tokyo Stock Exchange and Singapore Speech by Mr Lim Hng Kiang, Deputy Chairman of the Monetary Authority of Singapore and Minister for Trade and Industry, at the Tokyo Stock Exchange Singapore Representative Office 10th Anniversary, Singapore, 14 December 2006. *  *  *  Congratulatory remarks I am delighted to be here with you this evening to celebrate the 10th anniversary of Tokyo Stock Exchange Singapore Representative Office. Firstly, I would like to thank the Tokyo Stock Exchange for its commitment to Singapore and the region over the past decade and I hope Tokyo Stock Exchange will continue to scale greater heights in coming years. Growth of Asia and Japan When Tokyo Stock Exchange established its overseas office in Singapore in 1996, Singapore and the region were experiencing strong economic growth with Asian economies developing at rates of about 5 to 10% per year. Today, we continue to witness the rise of Asia on the back of the twin drivers of China and India. Prospects for South-East Asia have improved considerably and Japan, after years of stagnation, is firmly back on the track of healthy sustained growth and is a major investor in South-East Asia. As of 2005, Japan's FDI into South-East Asia totaled $ billion, and it is the top investor in Indonesia, and the third largest investor in Vietnam. Changes in the global exchange landscape The competitive landscape in the global exchange arena has also changed significantly.

And today, perhaps even on your way here, you listened to a streaming service on your phone or watch using voice commands. There's been much innovation over the years, and many improvements in terms of convenience and costs, but at the most basic level we are still doing the same thing: enjoying music. It's how we're doing it that's changed. The same is true with money and payments. Both are fundamentally changing through technological transformations. As happened with the delivery of music, the pace of technological advancement is accelerating, and it's clearing the way to do things faster or more efficiently. On top of that, the development of digital currencies has boomed. This includes cryptocurrencies that are not fully backed by other assets. It also includes stablecoins that are fully backed by safe and liquid assets, and central bank digital currencies (CBDC). Both stablecoins and CBDC that are fully backed by safe assets have the potential to be a new way to hold money and make payments. While all of this innovation opens up possibilities to do things differently than the past, it also carries risks. Just like listening to music, the "how" may change, but the "what" will remain the same. As we look ahead, it's important to remember that even as the technology changes, the role of the central bank has not. It is and will always be to supply money and liquidity to bring stability to the economy and financial system.