samchain/econo-pairs-v1 huggingface dataset:
And third, I will argue that we need a credible long-term path towards more convergence and stronger resilience in the euro area so as to foster durable growth and ensure that the return of confidence is long-lasting; this is about the commitment to perform right up to the end. I refer to this long-term policy effort – not to qualify for participation in EMU, but to maintain successful participation in EMU – as “convergence process 2.0”, as I will explain in a moment. The state of the euro area The European economy is undergoing a moderate recovery, but complacency would be unwarranted. To really overcome the crisis, there are some remaining major challenges still to be faced. First, the euro area’s debt has stabilised, but remains at high levels.1 Second, euro area unemployment is still high and the youth are suffering disproportionately.2  1  In 2013 public and private sector debt reached respectively 95.1% and 168.0% of GDP. The debt level is especially high in some Member States: for instance, public debt stood at 175.1% of GDP in Greece and 132.6% in Italy, while private sector debt amounted to 319% of GDP in Ireland and 252% in Portugal. 2  Euro area unemployment rose to 12.0% in 2013. Youth unemployment reached 24.0% in the euro area and increased dramatically in Greece and Spain to 58.3% and 55.5% respectively.

Therefore, the existing rules should be applied, and they should not be stretched to a point where they would lose their credibility. There is built-in flexibility in the Stability and Growth Pact to account for the cost of major structural reforms – but it cannot be based on empty promises. The sequencing should be clear. First, reforms need to be adopted and implemented. Then,  3  Euro area GDP is expected to recover at a pace of 1% in 2014 and 1.7% in 2015 according to the latest ECB staff projections. 4  Total investment in the euro area has shrunk by almost 20% since the peak in economic activity in 2008. In addition, total factor productivity has also been disappointing in the euro area since 2000: it grew by 0.45% annually from 2000 to 2007 before receding by 0.47% annually between 2007 and 2012 (source: Ameco database, European Commission). 5  See Barroso, J.M., “Remarks by President Barroso on the Country Specific Recommendations 2014”, speech given in Brussels on 2 June 2014. BIS central bankers’ speeches  3  the cost of such a reform, independently assessed, could be taken into account under the Stability and Growth Pact, with due attention to the limited fiscal space provided by the high debt levels. Economic stability is a necessary condition for growth, but is not sufficient alone. For our economies to grow out of high debt and unemployment, and thereby ensure social stability, we need to do more.
With the mounting concerns in financial markets over the ability of several, mainly peripheral European countries to handle their public debt level, the situation has evolved significantly. Exchange rate developments became a challenge for the Swiss National Bank (SNB). With interest rates at zero and limited means to further expand monetary policy through other quantitative easing channels, exchange rate interventions were a necessary unconventional monetary policy tool. The SNB made it clear that it would fight off “safe haven” flows out of the Euro in accordance with its objective to prevent deflationary risks from materializing by way of an excessive appreciation of the Swiss franc. This strategy of fighting off deflation risks has yielded the intended results. The deflationary risk in Switzerland has largely disappeared and the Swiss economy has been able to benefit from the ongoing recovery of the global economy. While the weakening of the Euro with respect to the Swiss franc is dampening export activity, exports are being supported by growth in foreign demand. Overall, today the outlook for the Swiss economy remains a favourable one. Admittedly, the adopted strategy is not without risk which comes primarily in the form of increased currency and concentration risk in the SNB’s balance sheet. This risk reflects the burden the SNB has assumed in order to protect the Swiss economy from the threat of deflation. The SNB has sufficient equity capital to withstand even large losses.

The first batch of CIFP graduates received their scrolls in February 2009 and all 32 have gained employment or have continued their studies further. This year, INCEIF will see the first batch of Masters in Islamic Finance graduate and next year will see the first batch of students to graduate from the PhD programme. This is indeed a significant milestone for INCEIF that is achieved in such a short period of time. As the Chancellor of INCEIF, it is my hope that the setting up of the INCEIF Chair of Islamic Finance will contribute to the development of expertise of the academic faculty and students at INCEIF in addition to expanding further understanding of Islamic Finance by the financial community. Please join me in welcoming Dr Abbas Mirakhor to deliver his lecture. 2  BIS Review 9/2010
On average over the past decade the UK ran a current account deficit of around 2% of GDP, increasing in the years immediately before the crisis. That is about double the post-war average, but compares favourably with the United States, which had a deficit of around 5% of GDP before the crisis. Sterling’s depreciation has already boosted the UK’s external balance sheet, and net trade should benefit too over time. Arguably, more serious imbalances were internal. Perhaps surprisingly, they did not show up in unusually strong output or consumption growth, in contrast to the inflationary booms that preceded earlier busts. In the five years leading up to the crisis, annual GDP growth averaged around 2½%, similar to the post-war “trend”. Much the same was true for household consumption growth, and its contribution to GDP even declined slightly during 2005–07. But, with slower income growth, the household saving rate actually fell throughout this period. Household balance sheets expanded rapidly, with debt and house prices rising in tandem. Access to cheap and readily available finance, and a willingness to borrow, led to household debt rising to over 150% of annual income. That inevitably made the household sector more vulnerable to adverse shocks; that is what leverage does! But there were also important distributional shifts. One way of thinking about the rise in house prices and increase in debt is as a transfer of wealth between older (house-seller) and younger (buyer) generations.

As a consequence, the return on capital is relatively low and wages are comparatively high, particularly so for unskilled labour. We thus tend to specialize in capital intensive and high-value added activities. External shocks tend to impact on us in a way that is not quite the  BIS Review 72/2004  1  same as on the rest of Europe. Moreover, we also have to cope with home-brewed shocks. It is for these reasons that we are eager to keep an autonomous monetary policy. Furthermore, if markets became convinced that in the future the SNB’s actions would simply mimic those of the ECB, they would rapidly force a convergence between Swiss nominal interest rates and those of the eurozone. Our real interest rates might remain lower for a while, given our relatively large supply of physical capital, but a tendency towards equalization would nonetheless set in. What this might mean for us is a higher rate of inflation for some time, together with a collapse in asset prices and in domestic gross capital formation. A mixture of higher interest rates and high, sticky wages would be very harmful to our economy. The third fear that was sometimes expressed, although here I must say I was rather sceptical myself, was that the euro would gradually render the Swiss franc obsolete. With many of our trading firms billing and paying their suppliers in euros, there might be a tendency for them to adopt the euro more generally for their accounting as well as for their domestic transactions.
Some analysts have pointed to the possibility that the recent productivity increase could be at least partly due to IT capital now making an efficiency impact on production even outside the sectors producing IT capital, where it has enabled rationalisation of labour and a reduction of the investment requirement. This theory thus explains the combination of rapid productivity growth, weak employment growth and a slow increase in investment, which has recently characterised both the US and Swedish economies. So what - apart from the actual developments in productivity, employment and investment - indicates that this is the explanation? One piece of the puzzle that supports this theory is that the improvements in productivity can scarcely be explained merely by business cycle effects. This becomes clear if we study productivity growth in the corresponding phase of the business cycle during earlier periods (Figure 5). The measure of economic activity we have chosen is, however, more or less arbitrary and does not entirely correspond to the assessment of resource utilisation in the Riksbank's Inflation Report. Nevertheless, this does not appear to affect the general conclusion that productivity growth is unusually rapid at present, bearing in mind economic activity and could thus be a sign of a sustained change. BIS Review 9/2004  7  5.

Businesscycle for labour productivity in business sector 8 quarters before and 4 quarters after business activity trough in four most recent business cycles Percentage 12-month change (5 quarters sliding average) 5  5  Current stage in business cycle Business activity trough  4  4  3  3  2  2  1  1  0  1982Q4 1981Q1 - 1984Q1  1993Q2 1991Q3 - 1994Q3  1996Q3 1995Q4 - 1997Q4  0  2003Q3 2002Q1 -2003Q3  -1  -1 -8  -4  0  4  -8  -4  0  4  -8  -4  0  4  -8  -4  0  4  Note. Business activity trough are noted in the quarters when the output gap, calculated with an HP filter, was as it largest. Another piece of the puzzle is the development of factor productivity (Figure 6). As I mentioned earlier, a more rapid growth in factor productivity at aggregate level could be a sign that IT capital is being used more efficiently even outside of the sectors producing IT capital. The best method would be to study factor productivity excluding the sectors producing IT capital, but this is not an easy task, due to various statistical problems. The calculations of factor productivity we have made at the Riksbank indicate a relatively clear upturn in recent years. 6.
[2] To maintain the claim of a negative relationship between inflation and central bank independence in the more recent period (in which central banks in advanced economies have not been struggling with high inflation, but rather with inflation being too low for too long) requires a more nuanced approach, as some commentators have stressed. [3] According to them, a consistently negative relationship between inflation and independence across time and countries remains intact if one considers a narrower measure of independence which captures the autonomy of the central bank in its selection and use of monetary instruments, in line with the core monetary policy function of the central bank (instrument independence). By contrast, the significance of broader measures of independence has been reduced in a period in which central banks have had to take on new tasks. At a conceptual level, the benefits arising from central bank independence in terms of price stability have been strongly echoed in the literature on rules versus discretion. [4] This literature points out that decision-makers who are subject to political election cycles tend to act in a more short-sighted manner when exercising their mandate. This short-termism creates an inflation bias, making it difficult to credibly promise actions which will validate low inflation expectations over time. To overcome this time-inconsistency problem, monetary policy needs to be delegated to an institution which is sufficiently detached from these cycles.

The members of the Supervisory Board and the steering committee shall act independently and objectively in the interest of the Union as a whole and shall neither seek nor take instructions from the institutions or bodies of the Union, from any government of a Member State or from any other public or private body.” Article 19(2) adds that “the institutions, bodies, offices and agencies of the Union and the governments of the Member States and any other bodies shall respect that independence.” The following question arises: what is the difference between the ECB’s independence as a central bank and its independence as a bank supervisor? [39] The first notable difference, as already mentioned, is that Article 130 of the Treaty is part of the Union’s primary or constitutional law, while Article 19 of the SSM Regulation is secondary law. This gives the provision shielding the central http://www.ecb.europa.eu/press/key/date/2017/html/sp170330.en.html[03.04.2017 15:53:14]  Central bank independence revisited  bank from influence when performing its monetary policy task in Article 130 of the Treaty a constitutional character and takes it outside the scope of the Union legislator’s legislative powers. By contrast, the provisions shielding the bank supervisor from influence are contained in secondary law, which is of a lower rank than primary law and easier to amend. Second, Article 19 of the SSM Regulation should be read in the light of recital 75 of the SSM Regulation, which refers to the importance of the prevention of private industry interference in the supervisory field, in addition to “undue political influence”.
In a sovereign money system, a bank is no longer permitted to use its customers’ sight deposits to finance loans. Instead, it is obliged to call solely on investors who provide it with money for loans on a more long-term basis. These may be customers with savings deposits, investors on the capital market, other commercial banks, or even the SNB, which can grant the bank a loan. Because sovereign money impairs the useful intermediary function played by banks in the monetary system today, lending would become more difficult and complicated – to the detriment of customers, be they savers or borrowers. 1  For more on maturity transformation as a traditional bank function and its importance to the economy, cf. Jordan, Thomas J., How money is created by the central bank and the banking system, speech held at the Zürcher Volkswirtschaftlichen Gesellschaft, Zurich, 16 January 2018. Page 3/8  The initiative’s undeliverable promises Financial stability  So, what benefits do the initiative’s authors see in sovereign money? They want to separate the creation of money from the granting of loans because they believe this will enhance financial stability. To achieve this goal, they call for customers’ sight deposits to be held in so-called sovereign money accounts as off-balance sheet items, just like securities custody accounts are today. This offers security in as far as this money is not at risk should the bank fail. However, barring the banking system from creating money is the wrong approach to take.

Equally, savers would be adversely affected. Their sight deposits in so-called sovereign money accounts would not earn interest and services would be more expensive, so they too would lose out. Sovereign money would be like throwing grit in the gears of our credit system. Banks would not be able to react as flexibly to the demand for credit, and this would reduce consumption, investment and ultimately prosperity in our country. Monetary policy  A sovereign money system would also complicate the implementation of our monetary policy. The ‘debt-free’ issuance of money is based on an outdated idea of managing money supply and fails to recognise the advantages of the modern implementation of monetary policy. The issuance of ‘debt-free’ money would technically correspond to monetary targeting and would therefore be like turning the clock back to the last century. The fact that all major central banks today practise interest rate targeting is no coincidence but is built on the pertinent experience of the last decades. Interest rate targeting is superior to monetary targeting and guarantees a flexible supply of liquidity to the economy, particularly during times of crisis. 2 Furthermore, it is fundamentally unclear how the SNB could absorb liquidity in a sovereign money system if the money supply had previously needed to be significantly expanded. How can you reclaim money you have just given away?
Different inflation developments than forecasters expected in January Annual percentage change 12 10  12 Range of other forecasters' estimates  10  MPR Feb 8  8  CPIF  6  6  4  4  2  2  0  0  -2 Jan-20  Jul-20  Jan-21  Jul-21  Jan-22  Jul-22  Jan-23  -2 Jul-23  Note. Refers to forecasts based on outcomes for the CPIF up to and including December 2021. The range shows the dispersion between highest and lowest estimates of other forecasters. Sources: Statistics Sweden, individual forecasters and the Riksbank. Figure 2. A broad rise in inflation – not just rising energy prices Sub-index in the CPIF  Measures of underlying inflation  Note. Annual percentage change. The range in the figure on the right shows the highest and lowest outcomes among seven different measures of underlying inflation. Sources: Statistics Sweden and the Riksbank. 12 [15]  Figure 3. Policy rates are eventually determined by the global real equilibrium interest rate  Source: The Riksbank. Figure 4. Inflation as high as in the 1970s and 1980s Annual percentage change 16  16 1970-1992 Average: 8.2  14  14 CPIF  12  12  10  10  8  8  1995-2022 October Average: 1.7  6  6  4  4  2  2  0  0  -2 1970  1980  1990  2000  2010  2020  -2 2030  Note.

Table 2 Domestic scenario (annual change, percent) 2012  2013 (e) Report, Jun.14  Report, Sep.14  2014 (f) Report, Jun.14  Report, Mar.14  2015 (f) Report, Sep.14  Report, Sep.14  GDP  5.4  4.1  4.1  3.0-4.0  2.5-3.5  1.75-2.25  3.0-4.0  Domestic demand  6.9  3.4  3.4  3.3  1.7  0.1  3.4  Domestic demand (w/o inventory change)  7.1  4.2  4.2  3.3  2.4  1.0  3.2  12.2  0.4  0.4  0.8  -0.7  -4.1  1.8  Gross fixed capital formation Total consumption  5.6  5.4  5.4  4.1  3.4  2.6  3.6  Goods and services exports  1.1  4.3  4.3  3.2  3.2  2.4  3.8  Goods and services imports  5.0  2.2  2.2  2.4  -1.1  -3.9  4.0  Current account (% of GDP)  -3.4  -3.4  -3.4  -3.6  -2.5  -1.8  -2.2  Gross national saving (% of GDP)  21.7  20.5  20.5  19.5  19.9  19.8  19.7  December CPI  1.5  3.0  3.0  3.0  4.0  4.1  2.8  December CPIEFE  1.5  2.1  2.1  2.8  3.7  3.4  2.5  (e) Estimate. (f) Forecast. Sources: Central Bank of Chile and National Statistics Institute (INE). 14  BIS central bankers’ speeches
However, both our baseline scenario and the market’s projections expect it to rise again above 4 percent and to stay in the neighborhood for the larger part of 2016. Our currency’s depreciation has been a significant factor behind the increase in inflation, reflected mainly in the CPIEFE inflation for goods which, after averaging –1.9 percent in 2013, has been somewhat below 5 percent since July this year. Add to this the indirect effect on other prices via indexation to past inflation. Aside from the sustained depreciation of the peso, the persistence of high inflation is also related, as was stressed in September, with the fact that output gaps, despite some increase, are of a smaller magnitude than they have been in other low-growth cycles, making it difficult for non-tradable goods inflation to make a bigger adjustment (figure 1). The evolution of output gaps is most evident in the labor market, where the unemployment rate remains low and annual growth of total employment hovers around 2 percent, with salaried employment showing faster growth at the margin. While nominal wages have had a gradual moderation since late 2014, they are expanding at about 6 percent annually (figure 2). Meanwhile, fuel prices have dropped and foodstuffs inflation has slowed. The recent adjustment of public sector wages should help to contain wage pressures. Our baseline scenario estimates that GDP will grow by 2.1 percent in 2015, within the range we foresaw in September.

This conference, attended by Keynes, among others, saw the signing of the agreements to set up the International Monetary Fund and the new exchange-rate system, which remained in force until the beginning of the 1970s. The system to which the Bretton Woods agreements gave birth replaced gold with the US dollar, insofar as exchange rates were fixed in relation to the dollar rather than to gold, although an indirect link to gold was maintained through the dollar/gold parity. It was agreed 3/7  at Bretton Woods to set up the institution charged with oversight of the stability of the international system of exchange rates, namely the International Monetary Fund. The “dollar standard” set the tone for the post-Second World War period. This era of relative stability and widespread prosperity ended in the early 1970s, when the US government suspended the convertibility of the dollar into gold, one of the pillars of the Bretton Woods agreements. This occurred when the markets came to believe that the dollar/gold parity overvalued the former, in a context of the economic and financial disruption that followed the oil market crisis in 1973. The system of fixed but adjustable exchange rates was abandoned and replaced by a floating exchange rate system, and at the same time all the rules relating to the convertibility of the various currencies into gold were also abandoned. Since then, the system of floating or variable exchange rates has been the mainstay of the international currency market.