samchain/econo-pairs-v1 huggingface dataset:
The surge in house price inflation has reached a peak. If the króna remains relatively strong and stable, goods prices are also quite likely to fall. Thus the outlook is for a slowdown in the inflation rate in the coming months, not least because the depreciation of the króna this year has only been passed  BIS Review 82/2005  1  on to the domestic price level to a limited extent. If the housing market cools more quickly than the Central Bank forecasts, house price inflation is likely to slow down even more sharply than is currently expected. Foreseeable exchange rate developments, an ongoing surge in private consumption and greater-than-expected rises in unit labour costs, however, will outweigh these factors in the long run. The Central Bank has repeatedly cautioned against ideas that the inevitable difficulties accompanying a tight monetary policy can be avoided by abandoning the inflation target temporarily, or “letting inflation through”, as it has sometimes been called. This is an unrealistic option. Such a volte-face in Central Bank policy would immediately push up inflation expectations, fuel even higher wage increases and catalyse a depreciation of the króna and more inflation. Ultimately the policy rate would need to be raised by even more to bring inflation back down. Businesses and households would suffer more rather than less from such a policy. Nor should it be forgotten that a large share of household and business debt is either price-indexed or exchange rate-linked.

Credit institutions are now proceeding more cautiously in their lending to this sector and interest rate terms are changing. Oil prices seem to be stabilising, and in spite of mounting labour market pressures, wage drift has been contained. The Central Bank’s policy rate hike is beginning to spread through the economy; monetary policy is transmitted with an inherent lag in all cases, and this has even been exaggerated by Iceland’s unique economic conditions at present. The most important change in the wake of the September policy hike, however, was that indexed bond yields began to rise at last. It was vital for monetary policy to begin to have an effect in the parts of the economy which showed the clearest signs of overheating, i.e. soaring private consumption growth. Although all these points represent an interesting and positive development, on their own they do not justify changing the policy that the Central Bank has been pursuing. Substantial pressures still exist in the economy, demand is buoyant and there are undeniably sizeable imbalances. These factors must be seen in context. While recent information on the short-term outlook should obviously be observed, it is even more vital to look at indicators for longer-term developments. In effect the Central Bank has no other option – like God’s mills, the Bank’s instruments grind slowly, but grind exceedingly well, if patience and foresightedness guide the way. The Central Bank has made no secret that the current strength of the króna is not sustainable in the long run.
There are also those who believe that to maintain Hong Kong’s competitive edge, we must be the only conduit for foreign capital going into and out of the Mainland. It means a “single access” model, with Hong Kong as the only link and conduit between the onshore and offshore markets. The rationale for Hong Kong to continue to monopolise the access to the onshore market is understandable. It also serves practical purposes at the initial stage of the renminbi’s internationalisation. But as the renminbi internationalisation progresses, this model is not sustainable in the long run. The aim of opening up the capital account and internationalising the renminbi is to foster general acceptance of renminbi in global trade and investment and as a reserve currency. To promote the extensive use of renminbi by corporations and investors around the world, renminbi business must flourish in different parts of the world. The development of the offshore renminbi market must shift from a “single access” model to a “multiple accesses” model. We pride ourselves as the world’s most important offshore renminbi centre, still far ahead of other centres in terms of the size of the liquidity pool and various financial intermediation activities. But there is no time for complacency. Our task is to consolidate Hong Kong’s unique advantages and leverage our first-mover position by incessantly upgrading our renminbi platform, making it the ideal choice for companies and financial institutions, on the Mainland and around the world alike, to conduct various types of offshore renminbi business.

Norman T L Chan: Reform and liberalisation in China – the positioning and future of Hong Kong Speech by Mr Norman T L Chan, Chief Executive of the Hong Kong Monetary Authority, at the Hong Kong Economic Summit 2015, Hong Kong, 1 December 2014. *  *  *  Ladies and Gentlemen, Hong Kong’s success story – borrowed time and borrowed place? 1. I am glad to be invited to address the Economic Summit 2015. This year’s theme is “Connectivity Breeds Opportunities” and “Breaking New Grounds for Economic and Trade Development”. I would like to share with you my views on Hong Kong’s positioning and prospect amidst the reform and opening up of Mainland China. I always believe that Hong Kong will be all the more prosperous as Mainland China continues to deepen its reform and open up further to the world. I do not subscribe to the view that our prosperity is built on borrowed time in a borrowed place. 2. There are some who think that time has changed and Hong Kong’s golden years are behind us. With China’s rise, Hong Kong will decline in its relative importance and relevance to the Mainland. Some also think that the Central Government will trigger a Plan B in favour of other Mainland cities to replace Hong Kong as its international financial centre if Hong Kong becomes unstable or is no longer reliable for whatever reasons.
Let’s be clear on this: French and European savers aren’t going to become Americanised in their savings behaviour or appetite for risk. These transatlantic differences have historical, cultural and sociological roots. And it’s not our role to go into them here, even less try to change them. However, the French debate would be made much easier if we distinguished clearly between the two main objectives underlying savers’ aversion to risk: security and liquidity. With regard to security, or capital protection, this is something that is important for savers. Genuine risk-taking, with all the potential gains it entails, will only ever be for a minority of investors. In the case of liquidity, however, increased life expectancy, lower pension replacement rates and the greater health risks associated with living longer are all pushing French savers to adopt longer and longer investment horizons. We need to be able to offer them suitable savings products: ones that are less liquid, with or without a long-term capital guarantee, and that allow savers to benefit from the higher returns offered by equities over the long term. A crucial point is to avoid any tax distortions that might mean these products are penalised more than liquid and risk-free investments. This level playing field in terms of taxation should also apply to the companies that are financed: in other words we need to avoid making debt financing more attractive than equity financing.

The medium-term perspective is decisive for us, most especially the question of whether we are dealing with a temporary soft patch or with a more prolonged weakness. And your response, particularly in view of the continuing weak data since the last Governing Council meeting? First of all, the data since the January meeting have not only held negative surprises, they have also contained a few positive signs such as the further decline in unemployment. But it’s also true that growth in the third and fourth quarter of 2018 and most likely also in the first quarter of 2019 is well below the potential growth rate of the euro area economy. So growth will have been below potential for three consecutive quarters and that’s not good news. The question now is whether there will be a rebound in the second quarter and beyond. A rebound is likely, but it is too early to say by how much. So would you say that the ECB’s Governing Council is becoming less confident that we are now merely seeing a temporary economic dip? The economic slowdown is broader and more persistent than had been thought and growth in the short term is likely to fall short of previous expectations. But as I said, what counts for us is the medium-term outlook and we see positive and negative factors there. What does that mean in practice? On the positive side, the situation for households and so for consumption is still favourable. That is a key driver of growth.
Moreover, the collapse of the investment bank Lehman Brothers demonstrated how difficult it is to manage very large institutions that experiences problems and to avoid the problems spreading to other banks and having negative repercussions on the financial markets. The intention is that Basel III should capture the risks in the banking system better than the previous regulatory frameworks and thereby reduce the likelihood of new financial crises. Basel III is thus a reaction to the fact that previous regulations were inadequate. The Basel III regulatory framework was published for the first time in its entirety in December 2010. Since then, the Basel Committee has worked to finalise the regulations. Beginning in 2013, Basel  BIS central bankers’ speeches  1  III will gradually replace earlier Basel regulatory frameworks. In Sweden, Basel III will be incorporated through EU legislation. More capital and larger liquidity buffers will increase resilience Put simply, Basel III is founded on four measures that act as instruments for assessing various risks in the banks. On the basis of these measures, the framework then stipulates certain minimum requirements, for example how much capital a bank must hold. The first measure is the risk-based capital measure, which is what we normally refer to when we speak about capital requirements. The risk-based capital measure was already a part of previous regulatory frameworks, but in Basel III it has been made much stricter. In addition to this there are three new measures: a complementary capital measure, the leverage ratio, and two liquidity measures.

Mario Draghi: Structural Reforms, inflation and monetary policy Introductory speech by Mr Mario Draghi, President of the European Central Bank, at the ECB Forum on Central Banking, Sintra, Portugal, 22 May 2015. *  *  *  Accompanying charts can be found at the end of the speech. Summary Structural and cyclical policies – including monetary policy – are heavily independent. Structural reforms increase both potential output and the resilience of the economy to shocks. This makes structural reforms relevant for any central bank, but especially in a monetary union. For members of monetary union resilience is crucial to avoid that shocks lead to consistently higher unemployment, and over time, permanent economic divergence. It therefore has direct implications for price stability, and is no less relevant for the integrity of the euro area. This is why the ECB has frequently called for stronger common governance of structural reforms that would make resilience part of our common DNA. Structural reforms are equally important for their effect on growth. Potential growth is today estimated to be below 1% in the euro area and is projected to remain well below pre-crisis growth rates. This would mean that a significant share of the economic losses in the crisis would become permanent, with structural unemployment staying above 10% and youth unemployment elevated. It would also make it harder to work through the debt overhang still present in some countries.
Capacity utilisation appears to be slightly above a normal level. The upturn in the Norwegian economy is expected to continue, partly fuelled by strong pick-up in investment on the Norwegian shelf in 2019. Further out, lower growth abroad and a decline in petroleum investment will weigh on growth. Chart: The Executive Board’s assessment and interest rate forecast The Board decided at the meeting to raise the policy rate to 1 percent. The assessment of the outlook and the balance of risks suggested that the policy rate will most likely be increased further in the course of the next half-year. Conclusion To wrap up, globalisation, digitalisation and structural changes are facets of the same long-term trend – we are in the midst of a technology-driven growth process that encompasses much of the world. It is easy to focus on the negatives, but we must also keep our eyes fixed on the big picture: never before have so many taken part in a journey with such a great leap in prosperity. But growth is unevenly distributed. The winners in global competition are reaping substantial rewards, while broad categories of wage earners in the traditional industrial economies have been left behind. The harmful effects of rising inequality must be taken seriously. We, the grownups, should also listen to the message sent from our youngsters. They demand that the world’s leaders take the climate threat seriously and put in place efficient climate policies.

Ardian Fullani: Overview of Albania’s latest economic and financial developments Speech by Mr Ardian Fullani, Governor of the Bank of Albania, on the Monetary Policy Decision-Making of the Bank of Albania’s Supervisory Council, Tirana, 29 January 2014. *  *  *  Today, on 29 January 2014, the Supervisory Council of the Bank of Albania reviewed and approved the Monetary Policy Statement of the Bank of Albania on the second half of 2013. Given Albania's latest monetary and economic developments and discussions on their outlook, the Supervisory Council of the Bank of Albania decided to keep the key interest rate unchanged, at 3.0%. The Supervisory Council deems that the inflationary pressures from the real and financial sectors of the economy are weak and will remain so. These circumstances require maintaining a stimulating monetary policy over the period ahead. The monetary stimulus, transmitted through the low key interest rate and ongoing liquidity injection, provides the proper conditions for meeting our inflation target in the medium term. Let me now proceed with an overview of the economic developments and key issues discussed at today’s meeting. *** Year 2013 was a difficult one for the Albanian economy. Aggregate demand and economic growth remained at low levels; inflation fluctuated around Bank of Albania's lower targeted band, while the budget deficit and public debt increased sharply. The unfavourable economic environment, both at home and abroad, led to this performance. Moreover, Albania’s June parliamentary elections added uncertainties to the economy and financial markets.
It is clear that further increases in the policy rate are required for inflation to return to the target. I will return to this later. But let me say now, that I am confident that the Riksbank will do what is needed to attain the inflation target. In contrast to the early 1990s, we now have a better mandate and a constitutional independence that enable us to take decisive action to attain the target. However, this must not lead us to underestimate the challenges we are facing. New vulnerabilities have been built up over the past 30 years: High indebtedness among households and businesses3, housing shortages, a divided labour market and a lack of investment in, for instance, defence, infrastructure, and climate transition. This means that the tightening will severely affect some households and businesses, while higher interest rates risk making necessary investments more difficult and costly. Diagram 1. The Riksbank’s policy rates since 1907 Per cent 100 80 60 40 20 0  -20 1900  1920  1940  1960  1980  2000  2020  Note. The Riksbank's policy rates consist of the discount rate, the marginal interest rate and the current policy rate (formerly known as the repo rate). Source: The Riksbank. Today, therefore, I would like to invite you to discuss the economic policy framework.

The price stability target was written into the law in 1999, at the same time as monetary policy decisions were delegated to an independent Executive Board. The fiscal policy framework For its part, fiscal policy would focus considerably more than previously on keeping public finances in good condition so as to maintain market confidence. The budget process was changed so that it would be easier to gain control over government spending, while public net lending would, on average, be positive through the so-called surplus target.7 The purpose of the latter was, of course, in the long run to get rid of the rampant government debt and to restore confidence in public finances. Industrial Agreement Swedish wage-formation also changed. It now works in a completely different way than in the 1970s and 1980s. One important reform was the so-called Industrial Agreement in 1997, under which the manufacturing industry has set the benchmark for wage negotiations and ultimately steered wage cost increases in the entire economy for almost twenty-five years. 6 Dagens Nyheter, 20 November 1992, Section A, p. 5. 7  For a discussion on the interaction between fiscal and monetary policy, which is not specifically addressed in this speech, see Jansson (2021). 5 [16]  ...laid the foundations for positive developments The ‘total renovation’ we made after the 1990s crisis has contributed to the overall positive developments during these past thirty years. The Swedish economy is working better. I would just like to briefly mention a few examples of this.
Before moving on to the next topic, let me close this discussion by stressing that, while central banks have been and will continue to be creative in using all available tools to achieve their mandate, we must recognize the limits of conventional monetary policy in circumstances of extreme financial distress. Conventional monetary policy alone is unlikely to be able to put back the economy on the right track and its combination with other policies certainly increases the chances of success. 4. Financial rescues and their Impact on a central bank’s balance sheet  Please allow me now to finish with another topic where Chile’s experience can contribute to the international debate: the implementation of a financial bailout and the risks it imposes on the operation of a central bank. In normal times, central banks conduct their operations maintaining only the safest assets on their balance sheets, typically government bonds or other low-risk assets. But in times of distress, acting as lender of last resort, central banks may also accept lower quality, more risky assets, as collateral for liquidity provision or in outright purchases aimed at rescuing banks, with the consequent risk to their balance sheets. This has been indeed the case in several countries during the recent financial crisis. The possibility that risk-taking by central banks may result in losses that affect their reputation and operations has recently preoccupied policymakers, especially when pondering about the possibility of a large rescue operation of troubled European banks by the ECB. The concerns are both financial and operational.

1  2  Source: Central Bank of Chile, Compendio de Normas Financieras. BIS central bankers’ speeches  However, in Chile the supervision of different groups of financial institutions, and the legal power and tools to enforce regulation are spread across several entities. For instance, the banking sector is under the supervision of the Superintendence of Banks and Financial Institutions (SBIF), mutual funds and insurance companies are regulated by the Superintendence of Securities and Insurance (SVS), and pension funds, which are large players in our financial system, are regulated by the Superintendence of Pensions (SP). In this setting, the preservation of financial stability crucially relies on the capacity and ability of all players involved, including us, to share our views and coordinate our actions. This is currently done through routine interaction between us, and more formally through periodic meetings in the Financial Stability Council, an entity created precisely to guarantee such coordination. 2. Financial stability tools  Let me now turn to the discussion of what are the most appropriate tools to pursue financial stability. Of course, this discussion draws from the previous one on whether the central bank should be in charge of it. But let’s forget about that for a second to tackle one of the main aspects of this debate, which is whether a central bank that cares about financial stability should use the policy rate as a tool. There are different views on this regard, both in academic and policy circles that you probably know well.
Governor Veerathai’s Statement Your Excellency, Fellow Governors, Ladies and Gentlemen, Members of the press,  A very good afternoon to you all,  It is my great pleasure to welcome our distinguished guests to this special event before the year ends. Let me extend a very warm welcome to Governor Agus and Governor Muhammad Ibrahim who have both travelled to Bangkok specifically for this occasion. The year of 2016, which is coming to the end soon will be remembered by economists and financial professionals as a year of the unexpected, beginning from China's circuit breaker in the very first week of the year, to negative policy rates, to Brexit and the US elections. Greater uncertainties now hang over the global economy. Fortunately, our ASEAN region, with its high potential, is a bright spot in the world. This is therefore 1  time for us to navigate today’s uncertainties through our concerted efforts to bring out the potentials of our ASEAN region. What we are witnessing here today is a renewal of the spirit of regional integration by relying more on collaboration to serve as a key driver for sustainable growth to benefit all of us. The MoUs that we are about to sign will provide flexibilities on foreign exchange regulations for the settlement of trade and investment in local currencies, resulting in greater efficiency and convenience for businesses. Another key merit of this framework is that businesses will be able to better manage exchange rate risks.

Peter Pang: Launch of the new cross-border collateral management service Remarks by Mr Peter Pang, Deputy Chief Executive of the Hong Kong Monetary, at the cross-border collateral management service signing ceremony and press conference, Hong Kong, 20 June 2012. *  *  *  Mr. Grimonpont, Mr. Bhatia, ladies and gentlemen, Good afternoon. It is my pleasure to welcome you to this signing ceremony. The bilateral agreements that I shall sign on behalf of the Hong Kong Monetary Authority with the Euroclear Bank and J.P.Morgan today will pave the way for the launch of the new cross-border collateral management service, a critical building block of the cross-border bond investment and settlement platform launched in March 2012. The new service, which will commence on 25 June, will bring significant benefits to the contracting partners and the money market as a whole. For Hong Kong, it will advance the development of our repo market, enhance the stability of our financial system and strengthen further Hong Kong’s role as the global hub for offshore renminbi business. The repo market is a key component of major international financial centres. It serves as the link between the money and capital markets, and is vital to the well functioning of the financing channels. By providing credit enhancement through the use of securities as collateral, the repo market also serves as the lubricant that keeps the financial engine running particularly during times of risk aversion.