samchain/econo-pairs-v1 huggingface dataset:
But that does not mean global effects are absent. The doubling of the effective global labour pool represents a huge, positive supply shock for the global economy. It has encouraged the shift of the production of goods and services that use lower-skilled labour intensively to countries with an abundance of lower-skilled workers – predominantly emerging market economies – while production of goods and services requiring more highly skilled labour has concentrated in countries with a greater share of higher skilled labour – predominantly advanced economies. The growing ability to split production components and tasks through global value chains has amplified this effect. 19  Globalisation has also increased the contestability of labour markets, weakening the extent to which slack in domestic labour markets influences domestic inflationary pressures. 20  That is, the increased ease with which  activities can be off-shored or domestic vacancies filled by sourcing workers from abroad may have reduced the relative bargaining power and wage expectations of workers. While it is difficult to measure precisely, available evidence suggests that contestability effects could be significant. 21  Greater openness appears to  22  and led to growth in domestic  have reduced the sensitivity of wages to domestic labour market conditions unit labour costs (ULCs) becoming more closely tied to global ULC growth. 23  Overall, the greater global supply of labour has lowered the relative wages of lower-skilled workers in advanced economies.

Combined with high productivity growth, this has resulted in high corporate earnings and solid growth in employment. At the same time, wage-earners share of corporate value added has been reduced, from around 75 per cent at the end of the 1980s to 70 per cent at the end of the 1990s, and now  BIS Review 121/2007  1  stands at below 65 per cent. Solid productivity growth and high prices for export goods and deliveries to the petroleum sector have contributed to the reduction in the wage share over the past few years. The ample supply of labour has probably had a dampening effect on wage growth. Increased globalisation may have provided greater opportunities for Norwegian enterprises to relocate production to other countries if labour costs become too high. This probably places some restraint on wage demands among workers in sectors where enterprises have such opportunities. Historically, a high wage share has tended to be accompanied by low unemployment. Developments in recent years have provided the basis for strong growth in employment while the wage share has fallen. Is it possible to sustain the combination of low unemployment and a low wage share? First, it partly depends on whether the positive supply-side conditions are sustained. There is probably symmetry here. Should the terms of trade deteriorate, productivity growth slacken and foreign workers return to their home country, the wage share will increase, profits fall and unemployment increase. There is now a prospect of slower global growth.
http://www.imas.gov.sg/News-and-Publications/Speeches-and-Monetary-Policy-Statem... 21-07-18  Connecting Global Markets Supporting Asias Growth  •  Page 2 of 7  The rapid expansion of the Asian middle class will spur urbanisation and demand for financial services, especially wealth management and insurance. Global investors are flocking to participate in the Asian growth story  •  There has been a growing diversity of institutional investors – from Asia, Europe and the Americas. Two key trends in the Asian landscape warrant investors’ attention:  •  the expansion of Asian enterprises; and  •  the demand for infrastructure development. More Asian companies are expanding regionally and globally. •  Companies from Asia have become increasingly active in cross-border M&A as they seek to expand their regional and global footprint. The need to fund this expansion has led to a surge in capital raising in Asia and increased the depth and diversity of Asian assets. •  Dollar bond issuance by Asia-ex Japan companies climbed to a record high of around $ billion last year, up 40% from 2016. •  About one-third of equity raised through IPOs globally in 2017 were in the Asia Pacific. •  Investors now have a wide array of Asian assets to choose from. As Asian companies gain market share globally, investing in Asian companies has become more attractive. •  Asia’s share of companies with market value of more than $ billion stands at 30%, compared to 20% just ten years ago. Investors in Asia are also looking to private markets for investment opportunities.

Since then, Asia has also been affected by the globalisation of terrorism, geo-political risks and disease. Indeed, this time last year, the mobility of people in the region was paralysed by SARS and geo-political risks prevented Governors from having an annual meeting for the first time in the Bank’s history. And recently there have been predictions that the large accumulation of foreign reserves and the associated domestic monetary management problems are presenting considerable risks to financial stability. I do not believe that another Asian financial crisis is in the making. But the fact remains that, by being relatively small and open, Asian financial markets are vulnerable to shocks. Just earlier this week, the greater realisation that the interest rate upturn in the United States may come sooner and increases possibly larger than expected sent shock waves through equity markets in the region. This is regardless of the comfort offered by the much higher savings rate of economies in the region and the generally low level of indebtedness, of households and corporations. This is also regardless of the increasing inter-dependence within the region, as evidenced by the rapid expansion of intra-regional trade, particularly in final products, and correspondingly reduced dependence of the region as a whole on import demand from developed economies. I have no doubt that Asian financial markets should remain open and, for those less open, continue with financial liberalisation, in order to benefit from the greater efficiency in the international allocation of capital that comes with globalisation.
Jean-Pierre Roth: Life in a two-headed monetary system - the Swiss experience Speech by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank, at the 50th Anniversary of the Bank of Israel, Jerusalem, 29 November 2004. * 1. *  *  Introduction  It is almost a common-place to state that the birth of the euro on January 1, 1999 was a milestone in the process of European integration. Giving up national sovereignty in monetary matters was without doubt a very bold move of historical proportions. It will have long lasting economic and political consequences. It is meant to promote efficiency, transparency, and growth. The creation of a single currency should also act as catalyst towards further European integration. Moreover, and this is really what I would like to focus on today, the creation of the euro has changed the world’s monetary landscape. I believe that one can say without fear of exaggeration that it has led to a new international monetary order. Countries such as Israel and Switzerland, situated on the periphery of the euro area, are affected as well. I would like to share with you some of our experiences in this regard, and I would be very interested to know to what extent these findings apply to your country too. 2. Our pre-euro worries  Quite frankly, my colleagues and I at the Swiss National Bank were somewhat worried before the introduction of the euro.

Ravi Menon: Down but not out: resilience in a post-COVID world Keynote speech by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the Singapore Maritime Lecture, Singapore, 2 September 2020. * * * Good afternoon to everyone tuning in from Asia, and good morning to the rest watching from across the globe. Let me thank the Maritime and Port Authority (MPA) for the opportunity to deliver this Singapore Maritime Lecture virtually. The global economy is facing its worst crisis since the Second World War. The IMF has forecast that the global economy will shrink by 4.9% this year. According to the W TO, global merchandise trade volumes contracted by an estimated 14% in the first half of 2020. And the recovery will not be spectacular – even in its more optimistic scenario, the W TO forecasts merchandise trade this year to be 13% below 2019 levels. With over 80% of international merchandise trade seaborne, the maritime industry has not been spared. Down But Not Out One of the great lessons of the COVID-19 crisis is the importance of resilience. In one of the most popular movie quotes of all time, the boxer Rocky Balboa says “It ain’t about how hard you hit, it is about how hard you can get hit, and keep moving forward.” Resilience is not just about being strong, it is not even about staying on your feet all the time.
My assessment is based on a longer time perspective and it may differ from a year on year approach. Romania is one of the few success stories of converging within the European Union, even during and after the crisis. GDP per capita at PPS increased from 50.6% of EU average in 2008 to 62.5% in 2017. The real GDP was higher by 17.5% in 2017 as against 2008; and the real potential GDP was 23% higher in 2017 as against 2008 (Figure 1). By the end of 2018, these figures will further grow by approximately 4 percentage points, according to IMF and EC forecasts. 2  IMF/EU programs from 2009 to 2015 were successful in many ways, contributing to a sharp adjustment in the budget deficit, exit from the Excessive Deficit Procedure in 2013 and reaching the MTO in the period 2013-2015. Structural reforms also advanced during the programs, one indicator of these being the large reduction in public government and state enterprises’ arrears. Exports of goods and services doubled in the last ten years, from 38.3 billion euro in 2008 to 77.9 billion euro in 2017, while imports increased by only 42.7% over the same period. CPI-based Real effective exchange rate (REER) is also lower than in 2008 (Figure 2). Consequently, the negative contribution of net exports to GDP has diminished, and the current account deficit witnessed a major adjustment of about 10% of GDP.

This year, after a fast raise in inflation mostly due to administered prices and imported inflation, we saw that inflation stagnated in June and then went down in July, following our three interest rate hikes in the first four months of the year and subsequently more firm liquidity management. CORE 2 adjusted inflation, an indicator that excludes highly volatile prices, has been decreasing since May (Figure 17). We are confident that inflation will reach our target by the end of this year, even if that would be at its upper bound. Next year, we expect inflation to go down close to 3%, but, as always, our predictions are not interest rate policy-neutral. 6  What is important to emphasize is that investors are discriminating among emerging economies, and for good reasons. Romania belongs to the group of Central Europe, with lower exchange rate volatility than its peers and slightly higher yields and interest rates than them, but very far away from the troubled emerging markets (Figure 18, 19, 20 and 21). Nevertheless, there is no time for complacency. And there is no room left for demand-side measures in the absence of supply side policies aimed at increasing potential GDP, and at improving the utilization of factors.
In 2013 Spanish banks persisted in their efforts to increase efficiency, readjusting their operating capacity by pruning staff and branch numbers in their business in Spain, which, compared with the highs in mid-2008, were down by around 20% and 25%, respectively. In an environment characterised by persisting downward pressure on earnings from factors such as weaker lending, low interest rates and still-high provisioning needs, banks have to persevere in reducing their operating costs and improving their efficiency. Conservation of banks’ capital In 2013 the banking sector strengthened its solvency. The aggregate core capital of all deposit institutions stood at 11.5% at the end of that year, up somewhat more than 2 pp on end-2012. From a medium- and long-term standpoint, the banking sector has to maintain its capital conservation policies. The economic recovery is still incipient and some fragmentation persists in the euro area financial markets. Moreover, the new solvency legislation which came into force in Europe last January implementing the requirements of the Basel III Accord, but whose application has yet to be completed, calls for, inter alia, higher levels and quality of capital. The Banco de España, recognising that it is desirable to conserve capital and strengthen solvency levels, last February renewed its recommendation that banks should limit their dividend payout policies. Challenges facing the Spanish economy and the role of economic policy I shall conclude with some thoughts on the challenges facing the Spanish economy and the role of economic policy. Our economy is currently setting its growth on a firm footing.

In this regard, supporting the development of a vibrant small and medium enterprises (SMEs) sector will be of particular importance. SMEs play a vital role in the economic growth of developing countries, typically accounting for over 90% of business establishments and about half or more of output and export shares. Their entrepreneurship, flexibility and responsiveness to change are essential driving force of economic development. The employment opportunities they create improve the livelihood of thousands of millions of poor people. In many developing countries, and in fact in developed economies as well, SMEs account for as much as 70% of the labor force. Despite the important role of SMEs in the economy, their growth is often constrained by the lack of capital, among other impediments such as regulatory red tape. Their small size, lack of credit ratings and the generally underdeveloped capital markets in the region deny SMEs access to bond and equity financing. Banks are also reluctant to lend to SMEs or charge them a high interest rate, since SMEs usually do not have strong credit history and cannot provide substantial collateral. Making available SME financing at reasonable cost is therefore crucial to the growth of this important sector. Providing policy loans directly to SMEs helps, but the assistance is limited relative to the enormous financing needs and there are always concerns about economic distortions and the efficient use of public resources.
Theoretical studies in the 1980s stressed central bank independence as a precondition to bringing inflation under lasting control, and support for reform soon spread from academia to policymaking. Professor Kenneth Rogoff, was a major contributor to this process, so we are privileged to have him as keynote speaker at this Conference. Central bank independence delivered upon expectations. As the countries with independent central banks grew to nearly 70 in recent years, average world inflation dropped to 4%, from more than 25% 30 years ago. Empirical studies are pretty conclusive on a strong correlation between central bank independence and low and stable inflation after controlling for other variables. The Central Bank of Chile, as one of the pioneers of this remarkable process in the emerging world, provides a good example of the merits of institutional independence. Independence of the CBC ended 40 years of double-digit inflation and coincided with the return to democratic rule in 1990. Inflation fell from almost 30% to 3% through the 1990s while the economy expanded at an annual average 6% in the decade, doubling the average for the previous 40 years. This provided legitimacy, credibility and respect for the Central Bank under its independent status, encouraging it to maintain high technical standards and commitment to its statutory goals of controlled inflation and financial stability over the years. Independence also helped many central banks to deal with the Global Financial Crisis (GFC) of 2008 and its aftermath.

However, it is hard to imagine the opposite situation of a central bank fully engaged in the management of expectations without trust from the public.1 This also applies to communication. We can discuss alternative strategies to make sure that the message issued by a central bank is adequately understood and internalized. However, there is little that a good communication strategy can do if the public does not trust the central bank.2 1  Christelis et al. (2016) have formally explored this for the Europe using micro data, finding that higher trust in the ECB lowers inflation expectations on average, and significantly reduces uncertainty about future inflation, even after controlling for people’s knowledge about the objectives of the ECB. Similarly, Mellina and Schmidt (2018) find that having greater trust increases the probability of expecting unchanged prices and decreases the likelihood of expecting either slightly or sharply rising prices over the medium term. 2  Through behavioral insights, Bholat et al. (2018) show that public’s trust in the Bank of England can be further improved by enhancing the communication with the public, particularly at times when trust in public institutions has fallen and responsibilities delegated to central banks have increased. Page 3 of 8  Central Bank of Chile July 2019  Approaching institutional credibility from stakeholders’ trust has a number of conceptual and operational advantages. First, there is a large body of research assessing its value: trust is at the heart of societies and a major component of social capital.
At recent auctions, both yields were still negative. It is interesting to note that these liquidity operations may have affected more than just current and expected short-term rates. After the SNB’s 17 August announcement, the rates of two-year Swiss government bonds briefly moved below zero, and the yields of longer-term Swiss government bonds also decreased significantly. While the yields on other long-term government bonds which are generally considered safe also followed similar patterns, it is nevertheless striking to observe in chart 5 that in the wake of the SNB’s liquidity measures in August, ten-year Swiss government bond yields experienced their largest declines since 1995. The interest rate and liquidity measures taken by the SNB in August naturally preceded and prepared for the introduction of the minimum exchange rate, in case it proved necessary. The SNB will continue to keep liquidity at exceptionally high levels, but has decided not to set a specific target level for sight deposits at present. Management of the foreign exchange reserves In the context of the minimum exchange rate, there has been renewed interest in the management of our FX reserves. Let me repeat here that our investments are subject to the primacy of monetary policy and implemented according to three criteria, namely, in order of priority: security, liquidity and returns. The SNB has to bear the risk associated with exchange rate fluctuations, as any hedge would be equivalent to buying Swiss francs against foreign currencies.

Likewise, the iTraxx Sovereign Western Europe Index, consisting of 15 sovereign CDS across Europe, rose by approximately 70% in the same period. 2  This is an approximation of the real effective exchange rate, assuming constant weights and inflation differentials. 3  Annualised volatility computed over one calendar month on the basis of daily movements. BIS central bankers’ speeches  1  rate on 6 September, EUR/CHF volatility has fallen below 10%, though it remains high from a historical perspective. The introduction of the minimum exchange rate also had an impact on some of the dynamic properties of the Swiss franc. As the red bar on the left side of chart 2 suggests, there was previously a positive correlation between the movements of the Swiss franc and those of risk indicators such as the VIX Index, i.e. investors tend to buy Swiss francs when perceived risk increases. In the same vein, the blue bar on the left of the chart shows that the correlation between the movements of the Swiss franc and those of risky assets, such as the equity shares on the MSCI World Index, has historically been negative. In other words, negative market developments have often been accompanied by a rising Swiss franc. Intriguingly, as the right side of chart 2 shows, the introduction of the minimum exchange rate appears to have had a significant impact on these correlations. The SNB’s implementation of monetary policy: liquidity measures On 3 August, the SNB started to implement liquidity measures against the massively overvalued Swiss franc.
Unless there is a substantial nominal depreciation, the current high value of the Swiss franc will therefore continue. Growth in the M1, M2 and M3 monetary aggregates has been perceptibly weaker since summer; this is primarily attributable to the rise in long-term interest rates. Liquidity held by households and companies has nevertheless remained high. In the past, a sustained high level of liquidity generally pointed to inflation risks. As a result of the financial crisis, however, this correlation cannot currently be made. Thus, in recent years, the inflation rate has remained exceptionally low despite a high level of liquidity. At present, there are no signs of a rise in inflation in Switzerland. Our inflation forecast shows no risk of inflation whatsoever. In addition, surveys on inflation expectations reveal values that are consistent with our definition of price stability. This applies not only to short-term inflation expectations, but also to long-term horizons of up to ten years. Furthermore, production capacity in Switzerland is still underutilised, which also makes a rapid rise in inflation unlikely. SNB monetary policy In conclusion, I would like to look at the SNB’s monetary policy. Overall economic conditions have hardly changed since summer. Consequently, monetary policy remains a challenge for the SNB. Up to now, our economy has performed relatively well, considering the difficult international environment. And we have not had to enforce the minimum exchange rate with foreign currency purchases since September 2012. Financial markets expect short-term interest rates to stay very low worldwide for some time to come.

The solution involves settlement of a large portion of the claims that the Central Bank received as compensation for deposits transferred to it, in accordance with the decision of the Financial Supervisory Authority (FME) on the disposal of assets and liabilities of Sparisjóðabanki Íslands hf. (SPB) in March 2009. The settlement of the compensation has not been finalised, however, and the matter is still being considered by the Financial Supervisory Authority. The Central Bank has concluded agreements with eight savings banks concerning the settlement of claims, and the agreements will be finalised soon after the Financial Supervisory Authority and other creditors have confirmed them. I realise that it is painful for guarantee capital owners and creditors to lose these assets, which were deemed quite valuable before the crash and were perhaps purchased recently with borrowed money. Nonetheless, it is necessary to face facts and try to salvage the value that remains. I have always viewed the savings banks as an important part of a healthy financial system, as they have a certain advantage in assessing local opportunities and risks and are generally trusted in their home communities. But this makes it important that the savings banks limit their activities to the areas where they can compete, and not extend into risky investment banking operations. With the financial restructuring currently underway, it will be possible to strengthen the foundations of important savings banks.