samchain/econo-pairs-v1 huggingface dataset:
Total factor productivity Logarithmed levels -3.3  -3.3 Actual TFP  -3.4  -3.4  TFP, forecast Potential TFP  -3.5  -3.5  -3.6  -3.6  -3.7  -3.7  -3.8  -3.8  -3.9  -3.9 80  85  90  95  00  05  10  15  20  Source: The Riksbank  10  BIS central bankers’ speeches  5. Capital stock Logarithmed level 29.2  29.2  29.0  29.0  28.8  28.8  28.6  28.6  28.4  28.4  28.2  28.2  28.0  28.0  27.8  27.8 80  85  90  95  00  05  10  15  20  Note. Capital services Sources: The OECD and the Riksbank  6. Number of hours worked Logarithmed levels 12.2  12.2  Hours Hours, forecast Hours, potential  12.2  12.2  Hours, HP trend  12.1  12.1  12.1  12.1  12.0  12.0  12.0  12.0  11.9  11.9 80  85  90  95  00  05  10  15  20  Sources: Statistics Sweden and the Riksbank  BIS central bankers’ speeches  11  7.

We need more knowledge of productivity growth Today, I have given you an account of how the Riksbank tries, in various ways, to assess how large resource utilisation is. One of the measures of resource utilisation that we use compares actual GDP with an estimate of potential GDP. The financial crisis has probably lowered the growth rate of potential GDP. Actual GDP is thus roughly equal to potential GDP at present, even though GDP is only slightly higher than it was before the crisis. My assessment is also that resource utilisation is largely normal. This assessment is also supported by other measures of resource utilisation that are not associated with such large problems in calculation. Resource utilisation has a positive relationship with future inflation. Resource utilisation is thus also an indicator of future inflation. It is therefore important to be able to reliably estimate the level of resource utilisation. But the financial crisis and the associated deep recession have greatly increased uncertainty in estimates of resource utilisation. Different  16  See “An indicator of resource utilisation”, Economic Commentary no. 4, 2010, Sveriges Riksbank. 17  See the article “The driving forces behind trends in the economy can be analysed using a production function” in the Monetary Policy Report of October 2010. 18  See also the article “Low unemployment – a challenge” in the Monetary Policy Report of July 2011.
Three years ago, the Federal Reserve’s decision to curtail the quantitative easing policy, quite unexpected for the market, became such a ‘black swan’. Two years ago, both the market and experts witnessed quite an unprecedented fall in oil prices. Last year saw a rather high market volatility caused by the reassessment of risks related to the situation in China. This year is not yet over but a ‘black swan’ has already flown out. I mean Brexit, which has also turned out to be quite unexpected for the market. We should try to foresee risks. However, it is not always possible. That is why it is important to ensure resilience of the system facing various risks, even unexpected ones, and have tools to stabilise the financial markets and the economy as a whole. As far as Brexit is concerned, in our estimates, its explicit impact on the Russian economy and financial system will be rather limited. We have already seen that Russian markets withstood the surge of volatility in global markets caused by the outcome of the referendum in the United Kingdom. Long-term implications will depend upon specific arrangements between the UK and EU and their influence on the global economy and financial markets. Brexit, however, can be seen in a wider context, i.e., as a manifest of public appeal for changes related not only to politics, but also largely to the economy, since the low growth rates of the world economy lead to a loss of confidence and dissatisfaction among people in many countries.

I have said that the banking business is undergoing a rapid new technology-caused transformation as we see the emergence of new areas in the banking business. Therefore, undoubtedly, both the regulator and the bank community need to be abreast of all recent trends and best business practices. This is the reason we have decided to launch an establishment that would be akin to a corporate university. This facility will operate on a permanent Bank of Russia-based platform, inviting global and Russian industry leaders to enable opinion exchange on development trends. My hope is that the bank community will assist us in developing the agenda for this platform. Given that I have presented today a fairy large volume of innovations in banking regulation, we decided to cover the other financial sectors separately in tomorrow’s session. Today, let me only guide you through our key priorities. One, advancement of the bond programme. Two, generation of long money sources through retirement savings and life insurance. Three, improvement of corporate governance, which is essential in capital market development. Four, efforts to better quality of financial consumer protection, a field with a lot of room for improvement, as well as improvement of interaction with us as a regulator, including through the Bank of Russia online reception. On a separate subject, let me note the need to counter unfair practices in the financial market, the drive to strengthen managerial responsibility in the industry and tighten business reputation requirements.
Caleb M Fundanga: Transparent pricing initiative in Zambia Remarks by Dr Caleb M Fundanga, Governor of the Bank of Zambia, at the official lunch of the Transparent Pricing Initiative in Zambia, Lusaka, 6 June 2011. *  *  *  The Vice President, Global Programs Microfinance Transparency, Ms Alexandra Fiorillo; The President of the Association of Microfinance Institutions of Zambia (AMIZ), Dr. George Mulomboi; Executive Secretary of Association of Microfinance institutions of Zambia, Mr Webby Mate; Chief Executives and Representatives of Microfinance Institutions; Colleagues from Bank of Zambia; Distinguished Invited Guests; Members of the Press; Ladies and Gentlemen I would like to thank MicroFinance Transparency and the Association of Microfinance Institutions of Zambia for inviting me to officiate at this important workshop on Transparent Pricing. I also wish to welcome our visitors from outside the country. I hope you will enjoy the wonderful Zambian weather. Madam Vice President, the importance of microfinance to an economy cannot be overemphasised. The provision of financial services to the majority of people and the small and medium enterprises who have traditionally been excluded from the formal banking sector is a key element to poverty reduction and economic development. Mr President, as you are aware, in Zambia, the recent FinScope Survey confirmed that levels of access to financial services continue to be low with only 37.3% of Zambia’s adult population reported to have access to a financial services. The survey however showed that the number of people accessing microfinance was on the increase.

This is a long-term possibility, but it would have the advantage of reflecting the strong trade linkages in the region. It would also create bigger and more liquid markets that are less susceptible to manipulation. It would also help address problems of intermediating financial resources within Asia. At present, Asia’s central banks invest massive amounts in foreign securities, particularly U.S. dollar assets, only to see volatile funds flow back to the region from overseas markets. By investing reserves directly in Asian financial assets, this type of costly and unstable recycling through developed markets could be reduced. There are, of course, many obstacles in the way of creating an Asian Currency Unit. The various economies of the region operate under widely differing economic regimes, and are at different stages of development. An institution would be necessary to administer the system, and the politics involved would doubtless be very complex. But I believe that now is a useful time to raise this topic for discussion, at least at an intellectual level: successful implementation in the longer term would go a long way towards addressing the currency instability we have seen in the region over the last year and a half. After all, it has taken the more homogeneous Europe fifty years to bring the euro into existence. A further long-term solution lies in the development of stable and transparent debt markets in the region.
Allow me to briefly remind you of some figures on Spain’s exposure to Latin America as a whole; this exposure is particularly relevant in terms of the stock of direct investment, given that around 31% of all Spanish foreign direct investment assets are located in the region. Particularly prominent are the positions in Brazil and Mexico. Trade is likewise significant, with 4.8% and 7.8% of all Spanish exports of goods and services, respectively, heading to the region. Since the early 1990s, the internationalisation of Spanish banking has largely focused on Latin America, in addition to the European Union, the United States and Turkey. Consequently, the region has taken on considerable significance for the Spanish banking 1  https://www.bde.es/f/webbde/SSICOM/20200115/Plan_Estrategico_2024_en.pdf. 1  system. Indeed, on pre-pandemic data, Spanish banks' exposures2 to Latin America represent nearly one-fifth of the system’s total and around 30% of the exposures located outside of Spain.3 Accordingly, the region’s economic performance has very considerable influence on the balance sheets of Spanish banks, while the risks stemming from these exposures could potentially become systemic. Clearly, the economic situation in Latin America, as in the rest of the world, has been severely affected by the COVID-19 pandemic. The human cost is significant. Since the onset of the pandemic, there have been more than 650,0004 deaths in the region, nearly 26% of the world total, when it accounts for just 8% of the global population.

We have taken several progressive measures to communicate more information, including cut-off yield rates of the OMO auctions and overnight liquidity estimates with a view to encouraging more efficient price discovery in the money market and promoting informed decision making by market participants as well as to improve market signaling of OMO. The Central Bank will continue to actively engage in liquidity management, while guiding the short-term interest rates along a desired path. Several measures, such as reviewing the compilation methodology of benchmark interest rates, strengthening the operational framework pertaining to the Intraday Liquidity Facility (ILF), introducing a rule-based code of conduct for Authorised Money Brokers and promoting market development will be taken to improve the efficiency and compliance in respect of money market operations. 11  As announced last year, the Monetary Policy Consultation Committee (MPCC) was reestablished in mid-2017 to draw on external expertise to support the conduct of monetary policy. We will continue to take on board stakeholders’ views and align our policies in a way, which is mutually beneficial for stakeholders and the Central Bank. As the conduct of monetary policy is dependent on an effective and prudent exchange rate policy, the Central Bank has introduced a more market based exchange rate system. It has allowed more flexibility in determining the exchange rate based on the market conditions and has intervened only to smoothen volatility and to build up reserves.
Of course, striking the right balance between these three principles is a process related to the economic and political traditions of individual countries. The issues I touched upon are important for the operation of any modern central bank. Today, I am particularly happy with the fact that these issues will be discussed within the club of the Francophonian central banks, where we have a very broad set of traditions, experience and knowledge. I believe that we are going to have a useful and fruitful discussion. Thank you for your attention! 2  BIS Review 42/2006

Provision of Financial Services Broadly speaking, the fundamental purpose of banking is to provide financial services such as credit provision, payments, and deposit-taking to support sustained economic growth. This is true in normal times, and is even more true in the current environment. The Fed has taken a number of actions to help the U.S. banking sector perform these critical functions through changes to supervision, regulation and the provision of liquidity. Collectively, these steps are designed to limit the potential for financial channels to amplify the initial economic shock created by the COVID-19 virus. Beginning with supervision, the federal banking agencies, in consultation with state financial regulators, are encouraging financial institutions to work with borrowers in a safe and sound manner.1 The agencies view prudent loan modification programs as positive and proactive actions that can help both borrowers and lenders. This approach is consistent with the agencies' longstanding practice of encouraging financial institutions to assist borrowers in times of natural disaster and other extreme events. The Fed has also provided information to banks on how we are adjusting our supervisory approach.2 This includes, for example, monitoring and outreach to help banks of all sizes understand current challenges and risks; a temporary reduction in exam activities, particularly for the smallest and lowest risk institutions; and additional time to resolve non-critical existing supervisory findings. These actions should help financial institutions deploy their resources as efficiently as possible and continue to support their customers and local economies in a prudent and fair manner.
c.  The Financial Stability Board has agreed minimum haircuts 7 in order to limit the leverage that non-banks can obtain through borrowing cash against private sector securities. These haircut floors have deliberately been set at “backstop” levels designed to prevent excess in times of market exuberance while allowing room for prudent firms to do their own risk management. d.  The US authorities have taken steps to strengthen the tri-party infrastructure. The reforms are not yet complete. One important missing ingredient is data collection to monitor market trends more closely. For example, the authorities need to understand the composition of the collateral being used across key financial markets in order to identify concentrations. The financial crisis showed the risks associated with a market-wide margin call when widely-used collateral is subject to an unexpected common price shock. Data is also needed to track the terms of transactions, including maturity and haircuts. One interesting idea is for regulators to run exercises in which they ask prime brokers to calculate portfolio haircuts against archetypal leveraged portfolios. The aims would be both to track any loosening in market-wide standards over time and to spot outlier dealers that require lower haircuts than their competitors. These significant regulatory reforms will have consequences for the behaviour of dealers and investors in securities financing markets. Some market participants may seek ways around the new regulations: for example, there has been talking about dealers “renting” balance sheet from other market participants or establishing off-balance sheet financing vehicles.

5  53% of the stock of bank loans to non-financial businesses pay a floating interest rate, and for an additional one third the interest rate is fixed for one year or less. BIS central bankers’ speeches  5  As a result of the Bank of England’s actions, we can relax other requirements to help with the flow of credit. Balance sheet repair will give confidence to depositors and investors who provide funding to banks. With that market funding assured, banks can safely hold fewer liquid assets, such as government bonds, that act as a cushion to be sold in the event that investors withdraw their funding. Accordingly, I can confirm today that, for major banks and building societies meeting the minimum 7% capital threshold, the Bank of England will reduce the level of required liquid asset holdings. The effect will be to lower total required holdings by £ billion, once all eight major banks and building societies meet the capital threshold.6 That will help to underpin the supply of credit, since every pound currently held in liquid assets is a pound that could be lent to the real economy. Taken together, our actions create not just a more resilient system, but also one more able to support and sustain a recovery by serving the real economy. Crossing the threshold of balance sheet repair is not the end-point. The 7% capital threshold, like the 7% unemployment threshold, is only a staging post at which we assess our next steps.
Net of interest payments, growth of nominal incomes has been little different over the past six years than it was in the pre-crisis decade (Chart 7). But balance sheets and gross debts are clearly far larger now than in the late 19th century. Productivity and real income growth have been significantly lower and, partly for that reason, the neutral real interest rate fell steeply after the crisis and almost certainly into appreciably negative territory. So even without deflation, central banks have found themselves up against the zero lower bound and compelled to employ unconventional policy tools. As a result, there is now less room to deal with any entrenched and protracted deflation, in prices and wages alike, should that occur. Chart 6 Spread between nominal interest rates, income growth broadly stable  Source: ONS. Chart 7 Net of interest payments, nominal income growth little changed since crisis  Source: ONS. A good disinflation so far… What are the chances of such a thing? Certainly what we’ve had in the past few months doesn’t qualify. In fact, it’s been a largely positive story, because the fall in inflation has been  8  6  Recall that the evolution of debt:income ratios depends on the gap between interest rates and income growth (footnote 3), i.e. the two lines in Chart 6. The fact this gap failed to widen didn’t prevent a significant impact of the credit crunch on spending: that’s effectively because, during such episodes, the maximum allowable debt:income ratio declines.

In this regard, the Budget for 2010 provides several incentives that are conducive to a stronger productivity performance, particularly concerning SMEs and research and development. Beyond capital deepening, improved prospects for productivity growth also require a heightened awareness that inefficient work practices, including over manning, slow down output growth and threaten the sustainability of employment and income levels. The concept of value for money that is increasingly determining consumer behaviour should be given equal importance in the workplace. There also exists potential for creating a more congenial business climate to reinforce Malta Enterprise’s investment promotion strategy. In a recent survey of corporations, a reduction in bureaucracy topped the list of measures that were considered necessary to further enhance Malta’s attractiveness as a location for foreign direct investment. 3 Education policies, too, can play a role by strengthening the country’s human capital, particularly by promoting greater synergies between educational institutions and industry. In assessing the role of productivity, it is well to reflect on the words of the Nobel laureate Paul Krugman, who said “productivity is not everything, but in the long run it is almost everything. A country’s ability to improve its standard of living over time depends almost entirely on its ability to raise its output per worker”. 4 … and sound public finances The third policy priority is to achieve sustainable public finances. The process of fiscal consolidation must resume in earnest once the recovery materialises.
Many expect both political uncertainties and oil prices to affect consumption and investment, but the latter to also have adverse impacts on our future ability to produce or what economists often call “productivity.” To add even more bad news, higher oil prices caused headline inflation to accelerate, registering 8.9 percent in June – the highest rate for the last 10 years. Given all available indicators, it is very likely that inflation will remain elevated for a while. Periods of rebounding consumer and businesses’ confidence seem to have come to an end – a picture that many of you may have currently embraced. Ladies and Gentlemen, Despite the adverse domestic and external shocks, the Thai economy has so far continued to perform well. Latest economic indicators for the first two months of this quarter showed  BIS Review 98/2008  1  continued expansion of both domestic spending and exports. On the supply side, production and prices of major crops grew markedly, resulting in an acceleration of farm income. Manufacturing production and the tourism sector also expanded well. The continued economic expansion has facilitated greater pass-through from producer prices to prices of other goods, lifting inflation further beyond the initial cost shocks. Given the ongoing trend in inflation rate, however, the economy in this second half of the year will likely be less robust. There are some indications that the rise in the cost of production and the acceleration of inflation have begun to affect the economy’s growth momentum.

In this regard, the task of monetary policy can be loosely described as getting the economy’s actual output as close as possible to potential output – tightening when actual growth exceeds potential and loosening when actual growth falls short of potential. Now, if potential output also falls in the face of persistent supply shocks, then it is possible for inflation to persist even when actual output growth is moderating. For concreteness, imagine a car going at a 100-kilometer-per-hour speed limit on a highway turning onto a local street where the speed limit is now 60 kilometers per hour. Even if the driver reduces the speed of the car to 75 kilometers per hour, a 25% reduction perhaps as a result of a narrower roadway, he will still be charged with speeding. In real-world policy making, this is what happened to the United States in the 1970s when falling potential output resulted in high and persistent inflation despite the slowing economy. At the time, the Federal Reserve overestimated the U.S. potential output during the oil shocks and unknowingly pursued policy that kept the economy going at the rate in excess of the reduced potential. The current tightening monetary policy of most central banks around the globe amid supply shocks reflects much of these concerns. It is important to recognize that growing beyond potential for too long is a serious threat to economic stability. To use monetary policy to accommodate growth when potential output is deteriorating would aggravate inflation and the subsequent disinflation effort would entail substantial costs.