samchain/econo-pairs-v1 huggingface dataset:
The consumer price growth will slow down together with the exhaustion of the effect of the external factors that played a prominent role in the first half and in the middle of this year; exchange rate dynamics is also expected to normalise. With the stabilisation and subsequent reduction in inflation expectations during 2015, the baseline scenario predicts a gradual easing of the monetary policy. The more pronounced the downward trend in inflation and inflation expectations will be, the more accommodative the monetary policy may become. (Slide 3)  BIS central bankers’ speeches  1  In addition to the baseline scenario, built on fairly optimistic assumptions, we have prepared two more alternative scenarios, number II and III. They are based on more negative assumptions. Scenario II predicts that the mutual sanctions and trade restrictions will remain during the whole period under review. This will lead to a certain increase in the capital outflows coupled with corresponding exchange rate dynamics. It should be noted that the ruble volatility, on the one hand, partially offsets the negative impact of external environment by maintaining the competitiveness of Russian producers and accelerating import substitution, however, on the other hand, it leads to enhanced inflationary pressures. Scenario II also assumes a possible increase in the tax burden. Due to the decision taken by the government on this issue, we plan to finalise this scenario. This scenario forecasts lower GDP growth rates compared with the baseline scenario (you can see it on the slide), and a slower decline in inflation.

The way we at the Riksbank conduct our monetary policy is described in the brochure “Monetary policy in Sweden”, which was published in May this year and is available on our website. I shall here reproduce the main features of the brochure and provide some comments of my own. The target for monetary policy is to maintain a low and stable level of inflation. The assignment we have been given by Parliament is to “maintain price stability”. The Riksbank has specified an inflation target whereby the annual change in the consumer price index (CPI) is to be 2 per cent with a tolerance interval of plus/minus 1 percentage point. The target for monetary policy is thus formulated in terms of CPI. However, when we analyse the development of inflation, we look at several different measures. Underlying inflation measured as UND1X is one such measure. This excludes household mortgage interest expenditure and the direct effects of taxes and subsidies. The former is particularly important, as an increase in the policy rate pushes up the CPI. It then looks as though inflation increases when we raise the policy rate, despite the fact that this measure will in the long-term dampen inflation. There is no such problem with UND1X. However, we also look at other measures. For the purpose of more clearly explaining the analysis, it may sometimes be necessary to disregard energy prices, or to divide inflation up into price developments on imported and domestically-produced goods. The effect of monetary policy on inflation has a considerable time lag.
The inter-connectedness of global financial markets and capital flows has been amply demonstrated. The resilience and current strong economic growth in Asia have therefore to battle against the strong headwinds and challenges from the global financial landscape. The sub-prime-triggered credit turbulence has, undoubtedly, created a lot of uncertainty. The adverse impact of the potential slowdown in the US economy is likely to be felt in Asia as the region’s economies are generally export-oriented. Large and volatile capital flows into the region have also placed pressures on exchange rates. This has posed risks of inflationary pressures, intensified by the recent high oil and food prices, spilling over into the Asian bond markets. Hence, it is crucial for regulators in the region to remain vigilant and to continue to control the risks that accompany the surging capital inflows while managing the currency and monetary conditions. Nonetheless, amidst this financial market turmoil, Asia’s resilience has thus far demonstrated its ability to weather the turbulence. Apart from Asia’s relatively limited exposure to sub-prime mortgages and related collateralized debt obligations (CDOs), the region’s strong economic growth and large liquidity pool, stimulated by the significant momentum coming from the domestic demand of China and India, and increasingly ASEAN, have cushioned the blow. Some may suggest that 2008 will be a difficult year for the credit markets and investors, especially those with weak credit profiles or the highly leveraged ones, may even divert exposures from equity and currency markets. However, the Asian bond market prospects, in my opinion, are not without bright spots.

01.06.2022  Parliamentary testimony: presentation of the Banco de España Annual Report 2021* Economic Affairs and Digital Transformation Committee Pablo Hernández de Cos Governor *iEnglish translation to the original in Spanish  *  Mr Chairman, ladies and gentlemen: I appear before this Committee to present the Annual Report 2021 of the Banco de España. The report offers an analysis of recent developments in the Spanish economy within the global setting, as well as how it is likely to perform in the future and the challenges it faces. I should like to begin by describing how the Spanish economy performed and the role played by economic policy in 2021. Next, I shall present the economic outlook following the new shock triggered by the Russian invasion of Ukraine, before going on to describe the key aspects of the sharp rise in inflation and outlining my thoughts about the role that economic policy must play to meet the short-term challenges. I shall then discuss the main mediumterm challenges and the recommendations that, in the Banco de España's view, it would be desirable to implement, to tackle them. Lastly, I shall address the situation of the banking system, by summarising the main messages from our latest Financial Stability Report, published in April. Performance of the Spanish economy in 2021 The recovery in activity that started in the summer of 2020 continued at the global level during 2021.
The rental market in outlying areas, which now indirectly has a larger weight in the CPI, is thin. Hence, the rental market does not necessarily provide a representative expression of owner-occupants’ housing costs. It is difficult to estimate the cost of owner-occupied housing. The harmonised index of consumer prices for the euro area, which the ECB uses as its measure of inflation, has not included owner-occupied housing so far. Nor do many of the national consumer price indices in the EU include this component. This is clearly not a good solution because housing costs normally account for a large portion of households' total cost of living. Eurostat, the European statistical agency, has therefore initiated a pilot study where they use the net acquisition approach.6 This approach is different from our method in that the treatment of purchasing a house for owner occupation is the same as for all other goods in the consumer price index. Only the household sector’s net acquisition of dwellings is included. In other words, purchases of dwellings bought from other private households are excluded. In addition, expenditures related to major repairs and conversions of a dwelling, and other expenditures such as estate agent fees, indirect taxes and insurance are also included in the acquisition approach. Land is treated as an asset and excluded. If European countries switch to including housing costs estimated using the acquisition approach, it will be natural for Norway to publish a comparable index for consumer prices, cf. figures based on Eurostat’s current method are also presented in Norway.

Over time, such a monetary policy will lead to higher inflation, not higher employment. Unemployment has declined markedly and is now very low. At the same time, wage earners’ share of corporate earnings has declined. Historically, there has been a clearly negative relationship between unemployment and wage shares. Developments in recent years have paved the way for strong growth in employment, also today when the cyclical upturn is in a mature phase. Developments in the past years must be seen against the background of the effects of a number of positive supply-side conditions on the Norwegian economy. High export prices and low import prices have led to a low rate of increase in consumer prices and an increase in household real wage income, but also to high corporate earnings and solid growth in employment. 1  See, inter alia, Rogoff, K. (2003), “Globalization and Global Disinflation,” Federal Reserve Bank of Kansas City Economic Review, Fourth Quarter, 45-78. BIS Review 102/2007  3  At the same time, productivity growth has been unusually high. The effects of this are more complex. In the early phase of the recovery, this delayed a pick-up in employment growth, but also contributed to low inflation. Increased productivity means that demand can remain high without rising inflation. The interest rate was set at a low level to bring inflation back to target. At the same time, this also enabled enterprises to make use of a higher growth potential. Eventually this also resulted in higher demand for labour.
That leads to the third and final critical element of fraud avoidance: sound risk management and internal controls. Financial institutions must be able to effectively identify and assess risk across their entire organization and ensure that process are in place to ensure compliance with internal policies and limits, laws, and regulations. In addition to the systems controls and the segregation of duties I have already mentioned, financial institutions need to have effective physical control of assets, clearly defined authorization limits and exception processes, and comprehensive risk management reporting to management and the board of directors. After management and the board of directors, the institutions’ internal audit and compliance units should be the first line of defense in preventing and identifying fraud. Those are the key responsibilities for institutions in the fight against fraud; however, one of the Bank of Thailand’s key mandates is to ensure the safety and soundness of the financial system. An essential part of this is to make certain that each financial institution has an effective risk management system in place to identify, measure, monitor, and control the risks to which the institution is exposed. To assist financial institutions in their efforts, the Bank of Thailand has provided sound-practice guidelines to local banking industry in a number of important areas such as corporate governance expectations, operational risk management, operational loss event collection, and security of electronic financial services. We will continue to provide guidance to assist our institutions.

Tarisa Watanagase: Mitigating fraud risk in financial institutions Keynote address by Dr Tarisa Watanagase, Governor of the Bank of Thailand, at the seminar on “Mitigating Fraud Risk in Financial Institutions”, Bangkok, 29 April 2008. *  *  *  Khun Kaisri, Distinguished Guests, It is my great pleasure to join you at this seminar on “Mitigating Fraud Risk in Financial Institutions”, hosted by KPMG Thailand. I would also like to thank the host for giving me this important opportunity to share the views of the Bank of Thailand on this topic. The globalization of the financial services industry, the increased sophistication and complexity of financial institutions and their services, and the ongoing advancement of technology continue to introduce new risks and opportunities for fraud. The pace and complexity of these advances have vastly accelerated beyond the risk associated with traditional credit and market risk activities. One of those emerging risks in financial institutions is fraud risk, which needs to be effectively controlled through effective governance and sound operational risk management processes. Fraud risk in financial institutions has increased as perpetrators use advanced innovation and technology to identify and exploit weaknesses in banks’ IT systems, databases, and delivery channels, including ATMs and the Internet. Financial institutions must take care to ensure that system security measures are effective as a means to combat fraud.
I would therefore like to encourage more countries to follow the initiative taken by the EU countries. 6  BIS Review 134/2008  Concluding remark Let me now conclude. The crisis we have seen over the last one and a half years will most likely redraw the global financial landscape in various ways. And even if the recent measures taken by governments and central banks have improved market conditions somewhat, it is far from certain that the crisis will be over any time soon. What will come out at the other end of the crisis is also still much too early to tell. Today, I have given you my views on some of the issues that need to be dealt with in the aftermath of this crisis. It all adds up to a quite significant to-do list, including various aspects of regulation, crisis preparedness, central bank policy and assessment and so on and so forth. It will most certainly take time before we can put an end to these discussions. In the meantime, the financial industry and the responsible authorities have to make certain that the costs of the prevailing financial turbulence are kept as low as possible. For me, as a central banker, this task translates into standing by the commitment to provide key markets and sound institutions with the liquidity needed to ensure that the financial system can function properly. Thank you! BIS Review 134/2008  7

Andrew Bailey: City Week 2014 Speech by Mr Andrew Bailey, Deputy Governor of Prudential Regulation and Chief Executive Officer of the Prudential Regulation Authority at the Bank of England, at City Week 2014: The international financial services forum, London, 31 March 2014. *  *  *  It is a great pleasure to be at City Week again. I am most grateful that you have timed it to coincide with our first birthday. It is a good time to reflect on a year that has had some moments. I have not tired of emphasising that our approach to regulation is necessarily forward-looking. I have been asked quite a few times over the last year what is my objective for the PRA. It is simple to describe but history would suggest less easy to achieve. I have been in the Bank of England for quite a while, and this new system is the fourth approach to financial regulation in the UK in my career. From that, I draw at least one conclusion, namely that we have a strong need to achieve a stable institutional structure of financial regulation in the UK. We are not alone in this challenge, but that does not change the objective, it just means we have company. That is my objective for the PRA, and for the new system of regulation as a whole, and I have been pleased to see the PRA Board and our staff working effectively to pursue that objective.
Thus, by 2017 a contraction of this component of gross fixed capital formation is expected, while the machinery and equipment component is slightly adjusted upwards, reflecting the actual data to date and also the steady growth in imports of capital goods excluding non-regular transportation. Externally, exports are forecast to contract this year as a result of some supply-side shocks in manufacturing and mining downtime in the first half of the year, which has already been reflected in lower shipments from the sector. However, as these factors are estimated to be transitory, by 2018 these shipments should post a visible recovery. For the purposes of the trade balance, the aforementioned increase in the terms of trade, in particular the higher price of copper, translates into an increase in valued copper exports, which more than offsets the lower volumes of non-mining exports. However, in a context of higher copper prices and lower costs in the mining industry, rents paid abroad increase, so in 2017, the current account has a slightly bigger deficit than was forecast in June (table 2). Inflation has been below expectations, standing at 1.7% annually in July. Although the evolution of core inflation was not very different from projections, the unusual drop in the fruits and vegetables component during these months has taken a little more than half a percentage point off annual inflation. Added to this is the significant appreciation of the peso since June, intensified in recent weeks.

Our economies and our societies have suffered heavily – indeed, on all available forecasts, this year will see the biggest declines in GDP recorded in peacetime – and we will have to endure a period of painful reconstruction for which sound knowledge and also good judgment will be essential. 1/1  BIS central bankers' speeches
The latter issue has been discussed more and more in the public domain recently, where it has been claimed that excessively tight monetary policy has resulted in the loss of up to 75,000 jobs, as if a simple relationship existed between interest rate decisions and jobs. Allow me to begin with a retrospective approach to address the issue of monetary policy’s effects on employment in the long run. Employment and inflation in the long term - a retrospective view During the first decades of the post-war era, one of the fundamental theses of Keynes’ legacy was that there was a direct trade-off between unemployment and inflation, implying that decision-makers could secure lower unemployment by allowing inflation to rise. Inflation was moderate and full employment was achieved. Owing to this line of reasoning, the fight against inflation was completely overshadowed by demand management. In addition, the power of monetary policy was constrained by the exchange-rate cooperation at that time - Bretton Woods - which had a fixed exchange rate as its target. When I started my economics education in the early 1960s, monetary policy revolved around quantitative controls of the credit market. Interest in stabilisation policy theory was instead tied to fiscal policy. The economics curriculum focused on the impact of fiscal policy on demand developments. How big are the multiplier effects of public expenditures, tax changes and expenditures financed in different ways? The supply side, i.e. the issue of the long-term sustainable growth rate under full capacity utilisation, was almost entirely overlooked.

The fact that employment depends on a number of other factors than monetary policy decisions and cyclical variations is illustrated, among other things, by the miscalculations of the National Labour Market Board just prior to 2004. In November last year the Board estimated that Swedish economic growth would be 1.4 per cent in 2003 and 1.9 per cent this year, while unemployment was forecast to be 5.1 per cent this year. Moreover, the Board believed that the repo rate should be cut from 2.75 to 2.25-2.5 per cent. These forecasts were roughly in line with those of the Riksbank at that time, with the exception that we, as usual, based our forecasts on the assumption that the repo rate would be kept unchanged. A year later we can say that economic growth has exceeded both the National Labour Market Board’s and our expectations at the same time as the monetary stance has become looser. Nevertheless, labour market growth has been weaker. This shows both that forecasters can be surprised by unexpected developments in the economy and that unemployment at present is not chiefly due to insufficient demand for goods and services owing to low growth and tight monetary policy.
This includes the increased pressure on financial institutions  BIS central bankers’ speeches  3  and regulators to have incentive systems, governance, accountability and controls to address the issues of over-emphasis on short term performance, reckless risk-taking and the pervasive conflict of interests. In tandem with this, is the stronger focus to spur consumer activism as a means to encourage more responsible and sustainable business practices. It is in this area that financial institutions can have an important role in creating positive conduct and behaviours among financial participants in the industry, as well as contributing towards uplifting the state of financial education and consumer awareness. Third, is the strengthening of boards’ effectiveness and accountability, and sound governance of financial institutions. Following the crisis, i.e. the global financial crisis, corporate governance practices in the financial industry have come under significant scrutiny. There have been increased expectations on the management, boards of financial institutions and on regulators to significantly improve governance practices, particularly in the area of risk management policies and procedures. At the international level, substantial enhancements have been made to standards on corporate governance. The growing expansion of ASEAN banks in the region, must therefore be accompanied by an increased emphasis for the boards and senior management of financial institutions to provide the leadership and oversight of group-wide risks arising from cross-border operations. Greater diversity of boards to appreciate cultural nuances and competitive dynamics in different markets will hence be key to support sustainable cross-border operations of the institutions.

Such long-term commitments to ASEAN will not only contribute to mutually reinforcing regional growth, but will become an important source of stability to the region. Conclusion Let me now conclude my remarks. There is less than three years to achieving the 2015 ASEAN aspirations. While many challenges remain, ASEAN is well positioned to collectively strive ahead towards the shared vision of a one ASEAN market. The financial industry has an important role in realising this vision, through its market conduct, business strategies and participation in domestic and regional collaborative initiatives. This conference provides an excellent strategic platform for the ASEAN industry to come together, share ideas and develop a greater understanding on the important issues towards building a stronger foundation for sustainable growth in ASEAN. On that note, I wish you an engaging and productive conference. 4  BIS central bankers’ speeches