samchain/econo-pairs-v1 huggingface dataset:
As a result, inflation in Malta was lower than in the euro area for most of the last six months, partly compensating for the higher rates registered previously. In the context of an economic recession, Malta’s public finances performed relatively well in 2009, although the country is still subject to an Excessive Deficit Procedure. The deficit-toGDP ratio declined from 4.5% to 3.8% in spite of an outlay of some 0.7% of GDP by way of  BIS Review 73/2010  1  targeted assistance to manufacturing firms and other stimulus measures. 1 To a large extent, however, the fall in the deficit ratio is explained by the presence of one-off expenditure items in 2008. 2 The general government debt ratio rose by around five percentage points to end the year at 69.1% of GDP, still below the estimated 78.7% euro area average. These developments helped to underpin confidence in Maltese government bonds, which are primarily held by domestic residents. In fact, all the government and corporate bond issues launched in 2009 were oversubscribed, in spite of the fact that the issuance volume doubled compared with 2008. Credit rating agencies have confirmed Malta’s sovereign credit standing, with Moody’s giving an A1 rating with a stable outlook. Spreads over the German benchmark ten-year bond yield have remained stable over the past year at around 123 basis points. Sources of economic resilience The relative resilience of the Maltese economy is mainly attributable to four factors. The first is the adoption of the euro.

A commonly recurring cyclical pattern is that productivity increases more quickly at the beginning of an economic upswing. Companies then normally have the capacity to increase their production with the existing resources. The need for resources then gradually increases and the companies begin to recruit new staff. Productivity growth usually falls then. When the economic cycle enters a downturn phase, productivity develops even more slowly. Another way of describing this cyclical pattern is to assume that the economy is exposed to technological shocks. This is how productivity is modelled in so-called real business cycle models. This is the case in Ramses, for instance, which is the general equilibrium model used by the Riksbank. But also by factors such as globalisation and new technology However, productivity growth did not fall back, but remained high in the latter half of the 1990s. There was only a marked reduction in connection with the bursting of the IT bubble in 2000 and in the following year productivity did not increase at all. Since then productivity has increased rapidly during the 2000s up to last year (see Figure 3). During the economic upturn in recent years it took longer before employment accelerated. Most indications are therefore that the strong productivity growth in recent years was not solely a cyclical phenomenon – it was also due to structural factors such as globalisation, use of information technology (IT), deregulation of product markets and innovations. Globalisation sharpens competition and pushes up productivity growth through a higher degree of specialisation and use of comparative advantages.
The establishment of the company BankAxept AS is promising in this regard. Norges Bank will closely follow developments and continue to publish information on costs, prices and market conditions. Contactless payments are making their way into the Norwegian payments market. Contactless payment allows customers to make a payment by holding a mobile phone or a card over a terminal without entering a PIN. 4 While this is a new means of payment, the underlying payment solution is not new. The solutions are often based on the use of credit cards, with a low price for users. If contactless payments based on credit cards supplant payments with BankAxept, the social costs of payment services may rise. Norges Bank has noted that the new owner company of BankAxept is considering developing a solution for contactless payments. This may bolster competition and help to lower costs of this type of payment too. Efficiency is more than low costs. Payment services have become faster and more userfriendly in recent years. For example, there has been an increase from two to four daily clearings and settlements. Contactless payments make small payments faster. Soon, online bank transfers will also become faster. With the new service “instant payment”, funds will be available in the payee’s account within seconds, while interbank settlement does not take place until afterwards. But there is still a way to go – in this area, other countries have come further than Norway. Hopefully, payment services in Norway will be even faster in the coming years.

But how do we explain the episode of the sell-off this January when the market already knew in December that tapering would proceed? 3. Conceptually, it is not very difficult to understand the spillover effects of the UMP on EMEs in the five years after 2009. There was the first phase of spill-over, which entails a period of heavy capital inflows, through the banking and bond market channels, to the EMEs. This was a “happy” phase of the spill-over of UMP because the EMEs basically enjoyed apparently pleasant outcomes in investment, consumption, job creation and economic growth. At the same time, EME currencies appreciated and their foreign reserves increased. However, this period also saw the build up of vulnerabilities in the EMEs. The inflow of capital, including the carry trade in search of yields, created easy monetary conditions, which encouraged rapid credit expansion amongst the households and corporates. While domestic consumption and investment became buoyant, most EMEs experienced a significant deterioration of their current account positions. Needless to say, inflationary pressure and overheating in the asset markets also built up in most EMEs. This was why some EMEs, Hong Kong included, have introduced macroprudential measures to tackle the spill-over  BIS central bankers’ speeches  1  effects of the UMP of advanced economies. While it is too early to tell whether these macroprudential measures were effective, the EMEs seem to be entering the second phase, which I would call the “unhappy” period, of the spill-over.
As to their specification, a key principle that should be followed in economic policy design is that each of the authorities’ targets should have a differentiated instrument to avoid any clash between them (the so-called “Tinbergen principle”2). The aim of maintaining financial stability with this aggregate perspective therefore demanded having one’s own tools. And, given that financial conditions can amplify the fluctuations of the economic cycle (e.g. more extreme and volatile movements in output prices, making it more difficult for agents to foresee their future economic situation) and also macroeconomic imbalances (e.g. activity highly concentrated in sectors that are not the most productive), a macroprudential approach to financial system regulation and supervision can conceivably mitigate the accumulation of these types of risks or reduce the cost of their subsequent materialisation. Specifically, macroprudential policy is entrusted with ensuring the soundness of the financial system in the face of systemic risk. This is, namely, the risk that financial instability becomes  1  Brunnermeier et al. (2009). 2  See Tinbergen (1956). 2  so widespread that it hampers the functioning of the system to the extent that economic growth and the welfare of the population are adversely affected. The “macro” prefix to this policy thus refers, on one hand, to the fact that it adopts an aggregate approach for the financial system as a whole; and, on the other, that it seeks to regulate the financial cycle, since this may amplify the economic cycle.

27.04.2021  Financial stability and macroprudential policy: objectives, tools and challenges* Universidad de Zaragoza Pablo Hernández de Cos Governor  *English translation of the original speech in Spanish  Distinguished Rector of the University of Zaragoza, Distinguished Dean of the Faculty of Business Economics, academic and other authorities, ladies and gentlemen. Good morning. It is an honour and a pleasure to be able to participate in this event organised by the University of Zaragoza. I should like to begin by expressing my gratitude to Vicente Salas, Chair of Business Economics at this University and the promoter of this meeting, who was linked for many years to the Banco de España in various capacities, as an economic adviser and as a member of our Executive Commission and our Governing Council. Over these years of intense collaboration, he played a pioneering role in theoretical and empirical works on the subject to which I wish to devote my address today: financial stability and macroprudential policy. In these papers he did not confine himself solely to studying various aspects relating to the financial system, but also devoted much of his research to analysing the interaction between the financial sector and the real economy, especially as far as firms are concerned. As I shall attempt to convey in my address, this interrelation is one of the key distinguishing characteristics that warrant and condition macroprudential policies. Financial stability is of fundamental significance for society’s well-being.
However, we are also seeing a proliferation of Central Counterparties (CCPs) and trade repositories being set up in Asia. While this will provide choice to Asian market participants, it may also increase risk and lead to higher costs. 17. Regulators will need a comprehensive view of risks in the cross-border, interconnected market. Having multiple CCPs and trade repositories in the region may risk fragmentation, and may hamper monitoring of systemic risks as regulators may see only their own segments of the market. Market participants will also face additional costs if CCPs and trade repositories lack economies of scale. 18. Asian regulators will therefore need to work closely together to enable infrastructural entities to offer their services across different jurisdictions. For example, the infrastructure of a DTCC global trade repository and AsiaClear CCP in Singapore offers the prospect of effective surveillance by regional regulators and economies of scale. We will continue to ensure that our market infrastructure operates in a transparent and accessible way so that the needs of regional regulators and the industry can be met under clear and robust guidelines. 19. At the global level too, there are real benefits for regulators to ensure interoperability in market infrastructure to allow for more effective risk monitoring. However, interoperability will require time and effort, as risk management practices such as margin eligibility standards have to be harmonised across CCPs in different jurisdictions. 20.

Mario Draghi: Short address on the occasion of the launch of the Europa series € banknote Speech by Mr Mario Draghi, President of the European Central Bank, at the launch of the Europa series € banknote, Bratislava, 2 May 2013. *  *  *  I mentioned this at the end of today’s press conference, but let me say again that I’m very pleased to be here today to see the launch of the new 5 euro, the first banknote of the Europa series. The new banknote will join 15 billion euro notes already in circulation. They are the most visible and tangible symbol of European integration, used from one end of the continent to the other. With the Europa series, we are giving a face to our currency. A portrait of Europa, a figure from Greek mythology, has been incorporated into some of the security features of the new series. After centuries of division, the European Union was awarded the Nobel Peace Prize last year for its contribution to “the advancement of peace and reconciliation, democracy and human rights in Europe”. We all know that Europe is experiencing some challenging times. Governments and citizens are making extraordinary efforts to put their economies on a sounder footing and to build a more stable future for the European Union. In times like these, it’s important to remember what the Union and the euro have achieved and what they mean in the longer term, especially for young people.
We did this when we decided to use reinvestments under the pandemic emergency purchase programme more flexibly, and when we agreed on the transmission protection instrument. These programmes ensured that rate normalisation proceeded smoothly. The third element of a robust strategy is a clear reaction function. At our last meeting, we clarified our reaction function and the sources of information that will be important to us. The future calibration of the rate path will be determined by – and will require continuous monitoring of – three key inputs, and this is what I will explain now. The inflation outlook The first input is our assessment of the inflation outlook in light of the incoming economic and financial data. This will be informed primarily by our staff inflation projections. Monetary policy must be forward-looking, given the lags with which our policy works. And the staff inflation projections are the best mechanism for distilling incoming economic and financial data into a comprehensive picture of medium-term inflation dynamics. The future rate path will depend on whether we see inflation converging durably to our target in our forecasts, and the level of confidence we have in this convergence as captured by the balance of risks. Our latest forecasts see headline inflation at 2.1% in 2025 and core inflation at 2.2%, which is a downward revision compared with our last projection round in December. But the confidence band around these forecasts is now unusually wide.

Süreyya Serdengeçti: Derivatives markets - Turkish Derivatives Exchange Speech by Mr Süreyya Serdengeçti, Governor of the Central Bank of the Republic of Turkey, on the occasion of the opening of the Turkish Derivatives Exchange, İzmir, 3 February 2005. *  *  *  Ladies and Gentlemen and Distinguished Guests, It is indeed a great pleasure for me to address you today on the occasion of the opening of the Turkish Derivatives Exchange, which is the beginning of a new era for the Turkish economy. Today, I will focus on the changing process of the Turkish economy within the framework of uncertainty and risk factors. I will also talk about the development of derivatives markets within this process, including their functions in the economy and especially in monetary policy. My remarks will be based on a macro framework rather than a micro one. Dear Participants, When we look at the Turkish economy, it can clearly be seen that risk management and derivatives markets, where risk is managed, as well as the institutionalized risk management culture established in the economy have failed to reach a satisfactory level and yet are still weak both in financial and real sectors, although this had constantly been on the agenda since the 1980s. The questions that should be asked at this point are that why risk management principles could not be established in our economy in a modern sense until now and why functionality in the derivatives markets could not be achieved in the proper sense.
It was difficult to predict the large fall in share prices and property prices. The decline in demand was substantial in any case and production and employment fell considerably. Unemployment reached the highest level of the post-war period. The  2  BIS Review 43/2006  budget deficit and government debt (as a percentage of GDP) also increased to all-time highs as a result of the crisis. Sweden and Finland were the European countries that suffered the most from the crisis, but other countries also experienced serious problems (see Figure 4). For most countries, this proved to be dearly-bough experience. Monetary policy was reformed to inflation-targeting policy, the exchange rate was allowed to float and a deficit target and an expenditure ceiling were introduced as norms for fiscal policy. We have had this new policy in Sweden for around 10 years now, and many other countries have chosen a similar policy. The labour market situation Most people would probably agree that the period from the mid-1990s, when inflation targeting was introduced, has been a relatively successful time in macroeconomic terms. Inflation fell fairly quickly from levels close to 10 per cent to around the inflation target of 2 per cent. Inflation has remained at a low level since then, albeit slightly too low in recent years (see Figure 1). Annual GDP growth has on average been twice as high over the past ten years as during the period 1980-1993. Employment growth has also been higher (see Figure 5).

the rudiment of the Central Bank continues to distribute banknotes and coins, attract funds, extend credits to banks, organize international payment operations. As late as in the sixties of the preceding century the competences of the National Bank, i.e. the Head Office in Macedonia started to be distinguished from the competences of the commercial banks. At the same time, however, the dependence of the Head Office in Macedonia on the National Bank of Yugoslavia of that time, increased - a process which was the same for all former Yugoslav republics. In fact, the activities of the Head Office of the Republic of Macedonia were reduced to performing only routine operations of executive and operational character. All policies, decisions and regulations were created and adopted in Belgrade. The second period, period of institutionalization, represents some kind of a turning point in central banking. In 1971, instead of head offices of the former Yugoslav republics, national banks of the republics and provinces were established, including the National Bank of the Republic of Macedonia. In 1972, the Parliament of the Republic of Macedonia adopted for the first time a law on the National Bank of Macedonia on the level of the Republic, while in 1974 it was defined also with the Constitution of the Republic of Macedonia. The first Governor, appointed in 1972, was Stojan Kjosev, who was until then a member of the Executive Council of the Republic of Macedonia.
[5]  In April this year, non-euro area residents became net buyers of euro area long-term debt securities – in moving annual sums – for the first time in nearly three years. As non-residents have been important counterparties to the Eurosystem in implementing the APP, the gradual slowdown in their net sales of euro area securities may not be surprising. It is likely related to the step-wise reduction in the actual pace of Eurosystem purchases. [6] 3/7  BIS central bankers' speeches  Euro area residents, by contrast, and this you can see on the right-hand side, have reduced their purchases of foreign securities to a much lesser extent. In fact, when we cut the monthly pace of our purchases from € billion to € billion in April last year, euro area residents increased their acquisition of foreign debt securities by more than 15% over the following six months. Even when we cut the monthly pace of purchases to € billion as of January this year, euro area residents remained important buyers of foreign securities. In the United States, and this you can see in the chart on the left-hand side of my next slide, euro area residents accounted for nearly 30% of total US Treasury purchases during the first half of 2018. In 2017, their share was 25%. Now, there is no simple answer that could help explain the observed investment pattern. Some would argue that foreign securities – US Treasuries in particular – offer a considerable yield pickup compared with comparable euro area securities.

Think about how difficult it is to get a mortgage if you’re a lower credit-rated borrower today compared to 2005, 2006. And two, productivity growth in the economy has been very anemic, and I think generally, most economists think there’s a relationship between productivity growth and the 2 / 13  BIS central bankers' speeches  inflation-adjusted level of interest rates in the economy. So, productivity growth is strong, you tend to have high real rates. At 2% inflation you get a relatively high federal funds rate. If productivity growth is weak, you have low real rates. Add 2% inflation, you get a little bit lower level of interest rates. So generally, if you look at the FOMC projections, people think that the federal funds rate in the medium term is going to more like 3% rather than the 4% that might have been attained historically. Now there’s one little problem with this. Economists are terrible at actually forecasting productivity growth. So just because productivity growth has been weak over the last few years doesn’t mean it will necessarily be weak over the next five years. Maureen O’Hara: Well, it’s a tricky one. Here’s one that’s tricky, too. Are there issues connected with financial market valuations that concern you? And that’s kind of the grown-up question. Here’s the one we all want to know. Any predictions on the Dow reaching 30,000 this year? President Dudley: No way. Maureen O’Hara: Oh, quick, call your brokers.
Was the adjustment of the interest rate path in June extreme? Here I intend to focus primarily on the reactions in the financial markets following the monetary policy meeting in June. As you will remember, the Riksbank at that time presented a new forecast for the repo rate. The forecast was on average 50 points above the earlier forecast that we published in our February report. We were then criticised because our revision of the repo rate forecast was greater than one would normally expect during such a short period of time. One observation is that while the revision was large, it was not in any way extreme. If one analyses how the implied forward rates are revised, one can see that the probability of these being revised to a greater degree than the Riksbank's revision of the repo rate forecast between the February and June reports is approximately 20-25 per cent. This means that on every fourth or fifth occasion the market expectations have been revised more than the Riksbank’s revision in June. What had the market agents expected? Another question is how the market agents’ expectations of interest rate developments changed after we had published our forecast in June. Figure 10 shows the expectations of monetary policy that can be understood from the implied forward rates.

Christian Noyer: No moral hazard – the banks are doing their job Comment by Mr Christian Noyer, Governor of the Bank of France, in the Financial Times, 18 September 2007. *  *  *  In recent weeks, Central Banks in Europe and the US have acted repeatedly to provide liquidity to interbank money markets. These interventions have raised some questions. Concerns were expressed that monetary authorities were bailing out speculators, thus creating the same kind of moral hazard that may have led to excesses in the past. There were also concerns as to whether the integrity of monetary policy would be compromised. These are valid questions. On numerous occasions, in the past, we pointed out the potential dangers that mispricing of credit risk posed for financial stability. We may be now seeing some of the consequences. Excessive risks were taken, and losses will have to be accepted. It is important that monetary and financial authorities take no action that would prevent this process from running its course, let alone be seeing to be condoning past or future excesses. However, the logic behind recent interventions is different. Put very simply, financial turbulence and uncertainty have suddenly triggered an upward shift in the demand for Central Bank money. Faced with such a shift, whose direction is apparent but amplitude uncertain, the choice, for monetary authorities, is clear: either accommodate, and provide temporary liquidity; or not, in which case, interest rates would have to rise to restore balance in the interbank market.