samchain/econo-pairs-v1 huggingface dataset:
The current account is not an indicator of Swiss capacity utilization; in particular, it is not an indicator of price stability. Consequently, the SNB has no target – and indeed should not have a target – for the current account. Rather, we need to take both the inflation outlook and capacity utilization into consideration, and must provide adequate monetary conditions in order to fulfill our mandate. Despite recent turbulence on foreign exchange markets in emerging economies, the Swiss franc has settled against the euro since September 2012 at slightly above the minimum exchange rate of 1.20. Accordingly, the SNB did not have to enforce the minimum exchange rate for over a year now. Yet the risks in the world economy are still to the downside and the Swiss franc is still high. Therefore, the SNB is maintaining the minimum exchange rate. It is the right tool for ensuring price stability in Switzerland in the foreseeable future. With short-term interest rates close to zero, the minimum exchange rate can prevent an undesirable tightening of monetary conditions in the event that upward pressure on the Swiss franc should intensify once again. Thus, as reiterated in our September monetary policy assessment, the SNB stands ready to enforce the minimum exchange rate and take further measures as required. 13  6  Source: U.S. Department of the Treasury.

In Switzerland, there is close co-movement between investment income and current account balances. Historically, surpluses have been the norm for Switzerland. Our current account has recorded almost uninterrupted surpluses since 1960. Although official time series do not extend further back than 1947, unofficial current account estimates show that, even at the beginning of the 20th century, the Swiss were saving more than they invested domestically.4 So, already then, a savings surplus was being invested abroad, laying the foundations for today’s international investment position, which is large by global standards. This took place against the background of an ever-appreciating Swiss franc during the post-World War II period.5 Most of the savings surplus is invested in securities, i.e. portfolio investment, and in production facilities abroad, i.e. direct investment.6 In this way, Switzerland has built up a strong net international investment position, most of which is held by multinational companies and pension funds.7 Let's now turn to income from services. Here, there are two drivers of the current account surplus: cross-border financial services and merchanting. Again, both activities are primarily driven by international financial markets and global demand for raw materials, and are not sensitive to movements in the Swiss franc. I don’t think I need to say much about receipts from cross-border financial services. The importance of the financial sector for our country is well known. Receipts from Swiss banks’ and insurance companies’ foreign customer business flow into the current account. In these cross-border transactions, banks’ financial services are the largest contributor.
Exports are growing, and stock markets are up. As a regional grouping, we have continued to integrate our economies while individually pursuing restructuring. ASEAN is now back on its feet, up and running again. The necessity of deeper integration The need to broaden and deepen economic co-operation is a necessity recognised by ASEAN more than ten years ago. In 1992, ASEAN started the ASEAN Free Trade Area (AFTA) to boost intra-ASEAN trade and establish the region as a common area for manufacturing operations. At that time, the catalyst for greater integration was globalisation. Competition was getting tougher. Europe was consolidating and integrating itself to form the Single European Market. In North America, the US, Canada and Mexico were preparing to form the North America Free Trade Area (NAFTA). NAFTA provided US manufacturers an attractive, low cost manufacturing base in Mexico. Mexico too expected to benefit from new investments from the US, which would create jobs and bring growth and prosperity to the country. Both the Single European Market and NAFTA strengthened the competitiveness of the continents, and threatened to divert investments away from Asia. Determined not to lose out, ASEAN responded with AFTA. In retrospect, AFTA is perhaps the most important decision on economic cooperation that ASEAN members have taken together. Today, the world is even more globalised than compared to 1992. Competition is once again at our door step. This time however, the competition comes not from Europe or Mexico, but from much closer to home. China and India are growing very rapidly.

With the urgency for immediate measures receding, it is hoped that it will give way to consensus on finding fundamental solutions that involve regulatory and institutional reforms both at the national and international levels. Conclusion Today, we have the opportunity to listen to Professor Ito's lecture on the similarities and differences between the Asian Financial Crisis and the Japanese crisis of 1997-1998, and the US financial crisis of 2008-2009 and the valuable lessons that can be drawn in a global environment that is more complex and interconnected. Professor Ito has written extensively on financial policy and has been a policy advisor to the Government of Japan. We look forward to benefiting from your experience and wisdom on this subject. 2  BIS Review 87/2009
Paul Tucker: A new regulatory relationship – the Bank, the financial system and the wider economy Speech by Mr Paul Tucker, Deputy Governor for Financial Stability at the Bank of England, at the Institute for Government, London, 28 May 2013. *  *  *  Thank you very much for inviting me here today. For someone who has spent pretty much the whole of my professional life in public service, it comes as something of a relief that the UK has an independent institute dedicated to analysing, monitoring and assessing the workings of government. And, as a central banker during a period in which the role of central banks around the world is once again being reshaped in the wake of the financial crisis, I am very glad to be part of your series on the changing relationship between the State and business. Frankly, it has been impossible not to reflect on precisely that issue as the reforms of the Bank of England have proceeded. I shall confine what I say this evening to brief remarks under three headings: •  The supervision of the safety and soundness of banks, and the place of rules and discretion in that  •  Expectations of what the central bank can and should achieve as a macro policymaker, and how society can monitor that role  •  How the central bank’s relationship with the business community plays out in a wider international, indeed global, setting.

•  So the PRA’s approach to prudential supervision entails making judgments of the kind:  •  Your bank isn’t as strong as you think it is  •  Cut back on the risk in your book  •  I’m afraid you’re not fit to run the bank  •  your business could not be resolved in an orderly way if it fails. •  This shift from rules to judgment changes the relationship between the regulator and business, and is an important example of what this series of talks is about. •  Challenge is how to make a judgment-based approach acceptable when we use it in earnest. Is our society really ready again for judgments from the Old Lady? •  Part of the solution is public law. The Bank must follow due process when it deploys its statutory powers, and that is subject to judicial review in the courts and appeal tribunals. •  But there is also a wider question about how society as a whole will keep us accountable or, more simply, just see what is going on during the periods, sometimes years, in which banks do not fail and the financial waters are – or at least seem to be – calm. Which brings me to our monetary and macroprudential roles, which indirectly touch every business, and household, in the country.
Country crisis programmes and IMF stipulations A third topic in the ongoing globalisation debate is the role of the international financial institutions, not least in the management of financial crises in recent years. The International Monetary Fund (IMF) has  4  BIS Review 2/2002  been criticised in particular from both the left and the right of the political spectrum. On the one hand the IMF has been accused of pumping in too much money in the form of massive support for countries with a medium income level and thereby disrupting the market’s normal credit assessments by protecting private creditors from losses. On the other hand, the measures required of individual countries have been said to be inappropriate and unduly harsh, leading to negative economic, social and political effects. During the past decade the IMF has provided support for countries with payment difficulties. This has amounted in practice to guaranteeing short loans in particular so that the country in question did not have to engage in onerous renegotiations with creditors and perhaps ultimately suspend payments, with serious potential consequences for its economy and standards of living. It is debatable whether this approach is sustainable in the longer run, although in each case acceptable alternatives have been hard to find at the time of the crisis. One consequence, of course, is that for such countries borrowing has been ‘cheaper’ than would otherwise have been the case.

We strive to keep our markets pro-business and to keep operating costs competitive. Being cost-competitive is not sufficient by itself. We need to make sure that Singapore continues to stay at the confluence of business opportunities. To facilitate business reach into major markets, Singapore has signed a series of Free Trade Agreements with many of our trading partners include the US, India, Japan, Korea, Vietnam as well as beginning free trade discussions with China and the Gulf countries. I am certain these strong ties that Singapore has built can only facilitate Deutsche Bank's business expansions in this part of the world. BIS Review 15/2007  1  Conclusion On that note, let me again extend my heartiest congratulations to Deutsche Bank on its 35th Anniversary in Singapore. We appreciate your commitment to Singapore and hope that Singapore will continue to play an important role in your growth in Asia and the world. Thank you. 2  BIS Review 15/2007
So it is simplistic to assume that Germany becoming less competitive would automatically help others – it may indeed harm them. The solution to rebalancing is for other countries to become more competitive, not for Germany to become less so. We need to maximise competitive pressures within Europe to achieve higher efficiency, innovation and productivity growth. And thanks to the structural reforms that are taking place, this is actually what we are seeing. For example, since 2011 Portugal’s export market share has increased by 11 percentage points and Spain’s by 8 percentage points. At the same time, I see a vital need for new investment in Germany. Investment is still around 1 percentage point of GDP lower than it was in 2007, and in that year Germany already had the lowest investment ratio in the euro area. To raise investment we need structural reforms in Germany as well – for instance to liberalise the services sector – thus creating a virtuous circle of higher potential growth and better investment opportunities. And by definition, if more German savings were invested at home, the current account surplus would also fall. To conclude, I do not see the current decade in the euro area as “lost” – I think it is being used well. The decade of adjustment we are facing now is to correct the mistakes of the previous decade. But in the process, I trust we are fixing our problems at the root.

Lowering the barriers to entering the financial sector, the free circulation of information and fiercer competition have also brought financial markets closer to a situation of perfect competition, which is of benefit to all consumers. Lastly, the growth of market financing has allowed savings to be channelled directly into investment. Reducing the share of bank financing, and therefore to a certain extent that of money creation, has enabled the financing of the economy to be less inflationary. Second consequence: a new framework for conducting monetary policy Financial deregulation has contributed to change the conduct of monetary policies. More open economies and greater interdependence between financial systems has completely overhauled the context in which monetary policy is implemented. •  Financial markets can now penalise inflationary monetary policies by withdrawing capital, with a subsequent rise in long-term interest rates and/or depreciation of the exchange rate. •  At the same time, the monetary policy transmission mechanisms have become more diversified and complex. This situation is one of the reasons why there has been a substantial clarification at a European and global level of the division of labour amongst economic policies. In this context, monetary policy has been clearly assigned the objective of maintaining price stability. Today, monetary policies are conducted within a framework characterised by two main features: •  Firstly, the reducing of inflation expectations depends on compliance with a number of rules that have been clearly defined in advance.
Inappropriate reserve maintenance: A currency board has to maintain its reserves in sterling or in Indian rupee because of the long economic relationship with those countries or economic dependence on them. But, both currencies at that time were not convertible, due to exchange controls imposed in the UK and India in the postwar period. 3. Adjustment for the future: Ceylon had at that time applied for the membership of the IMF and one of the requirements to be met once the country gained the membership was to express the value of currency in gold or in a gold-convertible currency. Both sterling and Indian rupee were not gold-convertible. 4. Limited activities of a currency board: Currency boards do only the issue of currency. Hence, they cannot supervise banks or take action for the development or the stability of the financial system. 5. Inability to cope with a wider definition of money: Demand deposits have become an important part of money supply. Currency boards do not have any instrument to control demand deposits, while a central bank could do so through statutory reserve systems. 6. Meeting the needs of financial institutions: Financial institutions need liquidity, reserves and clearing and settlement facilities. Currency boards cannot meet them. 7. Inability to tackle crisis situations: Currency boards are “fair-weather” systems and not geared to tackle serious domestic or international crises. For instance, if a crisis demands an expansion of liquidity as its solution, currency boards cannot act in such situations. 8.

Certainly, once more aimed at more successful financial risk management. •  Fourth, the European Union membership requires methodological harmonization of the statistics with the requirements and standards of the European Union, which is not easy. This is particularly important for the Republic of Macedonia, as a future European Union member-state, and requires immediate actions for improving and adjusting of the statistics to the European Union requirements and standards. Besides the need of holding relevant statistical data, the National Bank pays special attention to the reporting costs incurred by those who reports. For that purpose, activities for rationalization and reduction of the reporting encumbrance are underway, by simplifying the reporting forms, careful selection of requested data, etc. Certainly, such rationalization takes into account the need of providing and holding data necessary for preparation of the macroeconomic statistics in line with the international requirements and recommendations. 2  BIS Review 100/2006  Cooperation with other institutions The National Bank, same as other central banks worldwide, is an institution that permanently conducts numerous macroeconomic researches and analyses, for successful performance of its core functions and tasks. Therefore, apart from the development of own statistics, the National Bank plays the role of a large user of statistical information from other institutions. In this light, I would like to emphasize the cooperation of the National Bank with both domestic and foreign institutions in the exchange of statistical information.
Charles L Evans: The Fed’s dual mandate responsibilities and challenges facing US monetary policy Speech by Charles L Evans, President of the Federal Reserve Bank of Chicago, at the European Economics and Financial Centre, London, 7 September 2011. *  *  *  In the summer of 2009, the U.S. economy began to emerge from its deepest recession since the 1930s. But today, two years later, conditions still aren’t much different from an economy actually in recession. GDP growth was barely positive in the first half of the year. The unemployment rate is 9.1%, much higher than anything we have experienced for decades before the recession. And job gains over the last several months have been barely enough to keep pace with the natural growth in the labor force, so we’ve made virtually no progress in closing the “jobs gap”. The Federal Reserve has responded aggressively to the deep recession and weak recovery, cutting short-term interest rates to essentially zero and purchasing assets that expanded its balance sheet by a factor of three. But since undertaking the so-called QE2 round of asset purchases last fall, the Fed’s aggressive policy actions have been on hold. Some believe that this pause is entirely appropriate. They claim that the economy faces some kind of impediment that limits how much more monetary policy can do to stimulate growth.

In the more optimistic case to which I subscribe, the productive capacity and potential wealth of the U.S. have not been permanently damaged and currently unused resources are still productive. Accordingly, in my opinion, monetary policy should be used more aggressively to increase aggregate demand. In time, a reduction in excessive risk aversion, supported by natural market forces would reestablish the fundamentals that previously supported stronger growth and full employment. In this way, large social losses would be mitigated. By stimulating aggregate demand, we can have “Morning in America, again” and our best days can still be ahead of us. 6  BIS central bankers’ speeches  But the clock is ticking – the longer we wait, the more likely it is that unutilized skills diminish to the point that more permanent damage takes hold. Challenge #3: monetary policy held back by zero lower bound By now, the third obstacle is quite well-known: the federal funds rate in the U.S. is currently constrained by the zero lower bound on interest rates. Given the economic scenario and inflation outlook I have discussed, were it possible, I would favor cutting the federal funds rate by several percentage points. But since the federal funds rate is already near zero now, that’s not an option. To date, the Fed’s policy-making committee, the FOMC, has used a number of nontraditional policy tools to impart greater financial accommodation. I have fully supported these policies. Today, however, I simply think we need to do more.
Relative to its 5.6 percent long-run average, net investment as a percent of GDP fell by twice as far as it had in any prior postwar recession. More to the point, the recovery in investment has been exceptionally anemic. Today, four full years after the trough of the recession in second quarter 2009, net investment as a percent of GDP is still only 3.2 percent – a level typical of past recession lows. Net investment as a percent of GDP was last at or above its 5.6 percent long-run mean 6½ years ago. Small wonder then that nonfarm payroll employment has been slow to recover too. Through August we had restored less than 80 percent of the 8.7 million jobs lost during the Great Recession. Less well known is the fact that real GDP per capita only recovered its prerecession peak this past summer.5 That’s 5½ years to make up the ground lost during the recession. Previous post-WWII recoveries never required more than nine quarters maximum. A Dallas Fed analysis suggests that the recent financial crisis and its aftermath put the U.S.  4  Net investment includes additions to fixed capital net of depreciation. 5  Real GDP per capita was $ in 2009 dollars in second quarter 2013 versus $ in fourth quarter 2007. BIS central bankers’ speeches  3  back by more than an entire year’s worth of output, an equivalent of more than $ per American household.6 Baker-Bloom-Davis and better comprehending uncertainty And what of uncertainty?

We are also aware of the important role that the Development Bank of Zambia and others institutions that provide long term finance can play in this process. It is for this reason that the Bank of Zambia monitors the performance of these institutions to ensure that  2  BIS Review 53/2010  they are financially viable to be able to play this important role. Rather than thinking of Government recapitalising these institutions, we should think more in terms of developing the capital markets to enable these institutions raise resources for long term financing from the private sector. On the issue of the foreign exchange market, I wish to emphasise that we have a flexible exchange rate regime that has served us well after doing away with exchange controls in the early 90s. The exchange rate of the Kwacha against other international currencies has enjoyed relative stability since 2003 when the interbank foreign exchange market system (IFEM) was introduced. With this system, the Bank of Zambia intervenes in the market mainly to smoothen fluctuations and to build international reserves. The exchange rate is expected to be driven by economic fundamentals such as the terms of trade. An attempt to fix the exchange rate would have disastrous effects especially when the fundamentals suggest that the rate should depreciate as this would wipe out all the reserves we have struggled to build over the recent past.