samchain/econo-pairs-v1 huggingface dataset:
This would mean that their income would for some time to come be used for amortisation rather than consumption and investment – we would experience a fall in demand in the economy.6 One important reason for the recovery from the crisis being so slow in a number of countries is probably that households have a large ”debt overhang” they are trying to get rid of.7 If one were to have this type of development, it would most probably mean that unemployment rose sharply and it would probably also be difficult to attain the inflation target for quite a long time to come. In the countries where housing prices have fallen in connection with the crisis, unemployment has increased quite substantially (see Figure 6). Excessive debt thus constitutes a threat to macroeconomic stability and price stability, and counteracting risks in this area is therefore entirely in line with the Riksbank's mandate and objectives.8 The idea behind the Riksbank's policy The idea behind the Riksbank's policy can be illustrated with the aid of two stylised scenarios (see Figure 7). Either one conducts a more expansionary monetary policy, as represented by the blue line, which endeavours to bring inflation up to the target within a relatively short time and to quickly reduce unemployment. However, this policy means that lending to households will increase and prices in the housing market will rise, ultimately to untenable levels.

Furthermore, given the nature of the crisis, the restrictive measures and the movement limitation, part of the population faced a forced reduction of the consumption, primarily the consumption of different services, which is characteristic for persons with higher income and with greater capacity and propensity to save. Third, given that all future economic flows are determined by the extremely uncertain epidemiological curve, in such an environment, the precaution motive has a great role in the depositors' behavior. The European Commission surveys for both our country and for the countries of the Western Balkans also show that the respondents' perceptions in 2020 and in 2021 are in favor of the view that due to the economic situation in this period, savings are more favorable decision, compared to recent years. At the same time, the surveys of our Statistical Office show a decrease in the utilization of savings as a source of income during 2020. What has been happening to the savings in the banking system in our country from the beginning of the pandemic onwards? The deposit potential is increasing with a relatively solid intensity of over 8% on an annual basis, whereby the dynamics of increase is very similar to that of the period 2018 - 2019. Such dynamics does not resemble a bit the developments during the global financial crisis, when in a short time the deposit growth slowed down, which from around 20%, reduced to around 7% on an annual level.
This result was significantly influenced by the positive balance of trade, due to both higher exports and lower imports. In the services balance, reduced shipment costs and the temporary increase in imports of services stood out (figure 7). On the external front, until the beginning of March, there was an environment of higher growth and concern about inflation. On the one hand, the increase in global growth expected for this year was based on upward surprises in the performance of several important economies, such as the United States, China and the Eurozone. On the other hand, in developed world economies, core inflation indicators were high, despite the fall in total inflation. All this heightened the concerns about inflation and the need to raise interest rates by the main central banks. In this scenario, commodity prices rose and risk aversion Fell. In general, interest rates rose as a result of the higher inflation outlook (figure 8). The tone of the external scenario changed significantly in the last month, as doubts arose regarding the financial health of international banks. The problems of several banks in the United States and Europe opened a scenario of greater global uncertainty. This has generated volatility in financial markets, which reduced risk appetite and led to an appreciation of the dollar and a decrease in government bond yields, anticipating a slower pace of rate hikes by the main central banks. It is worth noting that the market anticipates a lower Fed funds rate path than the Federal Reserve itself has communicated.

Ardian Fullani: Cooling down the liquidity situation in Albania Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the 6th Vienna Economic Forum, Regional Cooperation – Challenges and Chances: "20 Years after the fall of the Iron Curtain", Vienna, 9-10 November 2009. *  *  *  The argument the organisers have found is very relevant, particularly when it comes to central banks of the Western Balkan. Actually, as far as I am informed from my colleagues, constrained liquidity (especially in foreign currency) and lending tightening are two fragile points, which may put us in a difficult position in the months to come. This set of two arguments carries over a dual problem: the short-term one, which puts banking system stability at risk, while providing its own implications even on the economic activity and on macro stability in a broader sense. The second problem is related to the financial support of the country’s economic activity in the future, given the recent years, when lending to the economy has constituted one of the main contributors in this regard. So far I deem that we have been effective in short-term management of these problems. Similarly to the European Central Bank and other central banks of the developed countries, we (the central banks of our region) have succeeded in supplying the market with ample liquidity, combining a variety of operational tactics and instruments.
Indications of a fall in interest rates are also found in the other two large euro area countries (Germany and France) and are in line with the evidence we have from aggregate bank interest rate statistics. This somewhat more positive picture compared  BIS Review 129/2009  3  with the euro area average indicates considerable heterogeneity of developments across countries, to which I will return in a few minutes. Bank lending in the euro area Let me now turn to actual developments in bank loans in the euro area. The growth of banks loans to the private sector has declined considerably during the financial turmoil, and in recent months the volume of lending has reached the lowest levels seen since the early 1980s, as can be seen in Chart 4. In the case of households, there have been recent signs that the downward movement has come to a halt. More precisely, the annual growth rate of loans to households has gradually fallen from the peak recorded in April 2006, when it stood at close to 10%, to levels of close to zero in recent months (-0.2% in August 2009) (see Chart 5). However, if the distortionary effect of the derecognition of loans on banks’ balance sheets related to the securitisation of loans to the private sector is taken into account, the growth of loans to households appears to be still positive and stabilising.

BIS central bankers’ speeches  7  Figure 2 Stock market indicators (1) (2) (index, 01/03/2011=100)  Sovereign risk premiums (1) (3) (basis points)  120  120  500  500  110  110  400  400  100  100  90  90  300  300  80  80  200  200  70  70  100  100  60  60  0  0  ene.11 jul.11 ene.12 jul.12 ene.13 11 Jun. 12 Jun. 13  11 11  Latin America  Emerging Asia  Emerging Europe  Developed  11 Jun. 12 12 12 Jun. 13 13 Latin America (4) Emerging Asia (5)  Chile  Emerging Europe (6)  (1) Dotted vertical line marks statistical closing of March 2013 Report. (2) Stock market indexes by region from dollar-denominated Morgan Stanley Capital International. (3) Measured by 5-year Credit Default Swap (CDS). Simple average of countries in each region. (4) Includes Chile, Brazil, Peru, Mexico, Panama and Colombia. (5) Includes China, the Philippines, Indonesia, Thailand and Malaysia. (6) Includes Czech Rep., Hungary, Croatia, Bulgaria and Turkey. Source: Bloomberg. Figure 3 Inflation indicators (annual change, percent) 10  10  8  8  6  6  4  4  2  2  0  0  -2  -2  -4  -4 06  07  08 CPI  09  10  11  12  13  CPIEFE  Source: National Statistics Institute (INE).
The official parity also determined the valuation of the gold stock on the SNB’s balance sheet. In order to eliminate these residual relics of the gold standard and enable a change in the SNB’s gold policy, the Swiss Constitution as well as the Coinage Act needed to be amended first. BIS Review 31/2005  1  Whereas during the 1980s and the early 1990s, the political climate did not permit such constitutional and legal amendments, the situation finally evolved in the late 1990s. The deterioration of Switzerland’s public finances led to a growing awareness of the opportunity costs of maintaining the existing structure of the SNB’s assets. The vast gold holdings increasingly gave rise to concern in the context of bearish market sentiments and of gold sales by other central banks. In November 1997, a partial revision of the Swiss National Bank Law increased the flexibility of the SNB’s reserve management activities. However, further legislative reforms were required to enable gold sales. In February 1997, a first decision regarding the demonetisation of gold was taken by the Committee for Economic Affairs and Taxation of the National Council, the lower chamber of the Swiss Parliament. Two months later, against the backdrop of mounting international criticism about Switzerland’s role in WWII, the President of the Confederation proposed to allocate some of the gains in the likely event of a gold revaluation to fund a Swiss Foundation for Solidarity which would provide assistance to persons in needs in Switzerland and abroad.

With the final tranche on July 14, the disbursement of the proceeds from the gold sales will have been completed, representing the largest financial transaction in the history of the Swiss National Bank. In my view, the most important lesson to be drawn from the SNB’s gold sales is that the decision to sell official gold holdings should be made separately from any consideration on how to use the proceeds. The history of the SNB sales shows that notwithstanding the constitutional and legal complexities I referred to earlier, the time between the expert opinion about the SNB’s excess reserve capital and the first sales was two and a half years. Switzerland’s politicians, on the other hand, failed to reach a consensus on what to do with the proceeds. After eight years of relentless debates and a squarely rejected referendum on the Swiss Foundation for Solidarity in 2002, the funds will be disbursed according to the constitutional distribution key for the SNB’s regular profits. I don’t want to burden you with the intricacies of the Swiss political debate around the gold proceeds. Let me simply say that it was not for lack of creative ideas that a consensus failed to emerge. This lesson strikes me as relevant with regard to potential renewed discussions about IMF gold sales. Such discussions should exclusively be conducted on the basis of a thorough examination of the solidity of the IMF’s financial position and not become entangled with proposals on how to allocate any expected proceeds.
These are the so-called “unobservable variables”, meaning that they cannot be measured directly (as can activity in a month or a year, for example) and thus must be estimated using different methodologies. The estimation of structural parameters is relevant for monetary policy decisions, as it provides a reference of where their values should stand over longer terms and therefore serves as a guide Page 5 of 27  for assessing the macroeconomy and calibrating monetary policy accordingly. In 2020, the Bank postponed the review of these parameters because the uncertainty surrounding the unusual nature of the shocks that were affecting the economy —the social crisis and the pandemic— made it more advisable to gather more information to assess the medium-term effects on the economy. The results of these estimates are detailed in three boxes of this Report. As for trend growth, its estimate is revised downward given the persistent slowdown in productivity growth over the last decade. Our estimate for non-mining trend GDP growth is reduced to a range between 2.4 and 3.4 percent for the 2021-2030 period, which compares to the range between 3.25 and 3.75 percent estimated for the 2019-2028 decade. This revision is mainly explained by a lower Total Factor Productivity (TFP) growth projection.1 This assumption is based on the consolidation of a downward trend since the early 1990s, which was only temporarily reversed during the commodity price boom of the second half of the 2000s (Figure 18).

  Second, the risk that a situation of prolonged absence from paid work may cause significant losses of human capital, which have an effect on future employability, productivity, and remunerations.4    Third, the net-worth effect of the use of mechanisms to compensate for lost income, such as indebtedness and savings depletion, with implications for the permanent income of the female workers affected. In the Chilean case, this is illustrated by the fact that 63 percent of the workers who emptied their pension fund accounts after withdrawing their pension savings are women. About women’s expectations for returning to the labor force, the CBC conducted a study that collected the testimony of a group of women who left their jobs to devote themselves to care giving and found three groups with different types of expectations. One group includes those who expect to go back to the work once the sanitary situation returns to normal. Another group includes those who believe that they will not return to the labor force after the crisis, with this expectation being more recurrent in older women. Finally, those who do  2  “Estimating Non-remunerated Household Work 2020” Statistics Division, Central Bank of Chile. IPEC, May 2021, Adimark. 4 Edin and Gustavsson (2008), “Time Out of Work and Skill Depreciation,” Industrial and Labor Relations Review; Hernanz and Jimeno (2018), “Inestabilidad Laboral en el Empleo, Duración del Desempleo y Depreciación del Capital Humano,” Cuadernos Económicos de Información Comercial Española ICE.
To my mind, international financial centres cannot be located in such countries without some ex ante mechanism that at least partly insulates the domestic economy from the risks involved. In some sense, this is what Iceland did in the nick of time in early October 2008. Furthermore, in very small, open economies with their own currency, like Iceland, the international activities of domestic banks and FX risks on their balance sheets must be limited and regulated. In this context, we have been thinking about the prudential regime that must be in place in Iceland when we have lifted capital controls and Icelandic banks are again free to use their European passporting rights. We will have more stringent restrictions on permissible currency mismatches than in the past, also taking into account positions of unhedged households and companies, but more importantly, we will, through some combination of LCR- and NSFR-type ratios in foreign exchange, put strict limits on FX maturity mismatches. The combination of these and other measures will make it impossible for the banking system to attain the size and cross-border reach it had before the crisis. The big question is whether it will be deemed compatible with the EEA Agreement. BIS central bankers’ speeches  3  More generally, I think the distinction between macroprudential measures and capital controls can be more complex than many make it out to be.

In the panic that gripped global financial markets after the collapse of Lehman Brothers, Iceland’s big banks were faced with a wholesale run on their foreign currency liabilities and were therefore heading towards a default on those liabilities in the absence of LOLR assistance in foreign currency. However, given their size, it was impossible for the Icelandic authorities to provide such assistance on their own. Given the lack of international cooperation, the Icelandic authorities were forced to consider radical solutions. Although they were probably not articulated fully at the time, these solutions entailed several goals: preserving a functioning domestic payment system, ring-fencing the sovereign in the case of bank failures, limiting the socialisation of private sector losses, and creating the conditions for the reconstruction of a domestic banking system. In essence, the adopted solution saved the domestic operations of the banking system and let the international part to go into a resolution process. The new banks were created by carving the domestic assets and liabilities out of the old, failing banks. The new banking system amounted to 1.7 times GDP. To a significant degree, these measures were successful in keeping the domestic payment system and basic banking services up and running, which was a key factor in dampening the effect of the banks’ failure on the economy. There were two key elements to the policy response during the autumn of 2008. The first was crisis management vis-à-vis the failing banks, which I have just mentioned.
And there is scope for greater deployment of our savings within our two regions, as investors in both regions look for improved returns. We are seeing the beginnings of a fruitful and meaningful relationship in financial sector cooperation. There is much scope for regional financial centres like Singapore and Kuala Lumpur to provide a gateway for fund flows between the Middle East and Asia. Singapore can by no means be a complete financial centre for the Middle East. That role will be played by financial centres in the Middle East. But we can and will complement and work in partnership with financial centres in the Middle East, and other Asian centres like KL. We can provide a gateway to take Middle Eastern investors into Southeast Asia and China, and to take investors from the region into the Middle East. What can we do to facilitate and spur on these financial ties and build sturdy bridges? Allow me to make three observations. First, the wealth management industry can play a pro-active role in helping investors to diversify their portfolios by introducing them to opportunities in Asia and the Middle East. In so doing, we will also help Asian and Middle Eastern capital markets grow and become deeper and more liquid. We are already seeing asset managers based in Singapore receiving investment mandates from investment agencies in the Middle East.

Kalin Hristov: Monetary unions in history Welcome remarks by Mr Kalin Hristov, Deputy Governor of the Bulgarian National Bank, at the Conference “Monetary Unions in History”, jointly organised by the Bulgarian National Bank and the European Association for Banking and Financial History (eabh) e.V., Sofia, 1 July 2022. * * * Dear Members of the Association, Dear conference participants, Ladies and Gentlemen, It is an honour to welcome you to this conference which the Bulgarian National Bank organises in cooperation with the European Association for Banking and Financial History. I am also delighted to have this event, together with yesterday’s workshop on the “Digital rebirth of historical datasets”, taking place in Sofia alongside the annual meeting of the Association. This year marks twenty years since the Bulgarian National Bank became a member of the Association; this is the first time, however, that an annual meeting and events of the Association are hosted in Bulgaria. Let me, therefore, extend words of gratitude for the excellent cooperation with the Association regarding the organisation of this series of events. The Bulgarian National Bank is one of the oldest central banks in the world, thirteenth by order of its establishment in 1879. Our institution has understandably cultivated a profound respect for banking and financial history, as seen from our topical publications and research projects we take part in. For us history is also vibrantly present today – exactly twenty-five years ago, 1 July 1997 was the day of introduction of the currency board in Bulgaria.
Following the launch of the first SEPA payment product for credit transfers last year, the transposition of the Payments Services Directive into national law as from November 2009 will support direct debit schemes, thus opening up the possibility of using such instruments in the SEPA area, including Malta. Given its importance for our banking system, the Central Bank of Malta has launched a Consultative Paper on the National Implementation of the Payment Services Directive. Malta stands to gain from SEPA. Along with the benefits of financial market integration, increased competition and scope for innovation, there is also a strong potential to attract e-commerce payment business and payment factory operations for trans-national corporations. BIS Review 65/2009  5  Investing in SEPA should not, therefore, be viewed as an expense, but rather as a business opportunity that will help banks pre-empt competition law problems, reduce costs and expand in new markets. In time, it may also come to offer new and profitable services, such as e-invoicing and reconciliation. For this to happen, the banks must see to it that their customers understand the advantages offered by SEPA and make use of it. The financial crisis has also highlighted the importance of stress tests, which assess an institution’s ability to withstand both institution-specific credit and liquidity risks as well as systemic risks, including adverse macroeconomic conditions. As stated in the Bank’s Financial Stability Report, the latest stress test results show that the banks generally have adequate capital buffers and sufficient liquidity to withstand extreme, yet plausible shocks.

An important catalyst is the renewal of RTGS, where we are making both policy and infrastructure changes to support not just a resilient payment system, but one that new players can enter and where innovation and competition can thrive. For those not familiar with RTGS, it is a critical piece of national infrastructure and the backbone of UK payments. Well in excess of £ every working day is settled through RTGS, including from CHAPS, the Bank-operated high-value payment system, and from the final settlement of the UK’s retail payment systems. The Bank has established the RTGS Renewal Programme to develop a new service which will not only enhance resilience but will also be fit for the future and promote innovation. Having defined the Programme scope, with input from the payments industry, we are now running a competitive public procurement process to appoint a Technology Delivery Partner. They will work with the Bank on the design and build of the core settlement engine. In supplementing the skills and resources we have in-house, the procurement provides the opportunity to benefit from diverse views and to draw on world-class expertise and cutting-edge experience on how we design and build RTGS for the future. In renewing RTGS, we are seeking to achieve five key outcomes, all of which will support a safe and diverse payment landscape. Despite being over 20 years old, the current RTGS service remains highly resilient. But we want to do more.