samchain/econo-pairs-v1 huggingface dataset:
5  Details of the Desk’s approach were described in an operating statement released by the Federal Reserve Bank of New York: Operating Policy Statement, August 10, 2010. BIS Review 128/2010  3  between 2 and 10 years, but with some purchases also occurring outside this segment. The average duration of the securities purchased is expected to be just over 5 years, although the exact realized outcome will depend on the offers that we receive in our operations. Under this approach, the purchases will remove a considerable amount of duration from the market relative to what the market would have held without reinvestments by the Federal Reserve. The reinvestment strategy, of course, also involves a reallocation of our portfolio from agency debt and MBS into Treasury securities. The FOMC’s decision to reallocate was based on a variety of factors. However, one crucial consideration was whether purchasing Treasury securities would have an effect on longer-term interest rates comparable with that of purchasing MBS. My view was that the effects would be similar, because purchasing longerterm Treasury securities removes as much duration risk from the market as purchasing current-coupon MBS. 6 The two approaches differ, however, in that purchasing MBS also removes prepayment risk from the market. If the market were to begin having trouble digesting that prepayment risk, the spread between MBS rates and Treasury yields could widen. A significant widening of MBS spreads to Treasuries, whether due to this or other factors, could affect policymakers’ decisions about which assets to purchase.

Indeed, according to their most recently published forecasts, most FOMC members expect the unemployment rate to remain above 8.25 percent through 2011 and the inflation rate to remain below its mandate-consistent level through 2012. In addition, the economy remains vulnerable to downside surprises that could take both output and inflation further away from the FOMC’s objectives. The sluggish outlook for the economy and the risks that surround that outlook have raised the possibility of further monetary policy accommodation. The most recent FOMC statement indicated that the Committee “is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate.” The FOMC has several policy tools that it could use to achieve more accommodative financial conditions, as Chairman Bernanke discussed in his speech at the Jackson Hole symposium in August. My remarks today will focus on one of those options – changing the size of the Federal Reserve’s holdings of securities. In particular, I will review the FOMC’s recent decision to keep the size of those security holdings at their current level, and I will discuss some of the issues to be considered in any decision on whether to expand them further. As always, the views I express are my own and do not represent those of the FOMC or the Federal Reserve System. Decision to reinvest maturing asset holdings The initial decisions by the FOMC to expand the Federal Reserve’s holdings of securities came at the height of the financial crisis.
Internationally, the risk of deflation has been the primary concern from a central banking and monetary policy perspective. In a low or negative inflation environment, consumption could be postponed in the expectation of further price reductions, putting pressure on firm revenues. Given the downward rigidity in wages, firms cannot easily adjust through lower wages in a deflationary environment. So a deflationary environment could lead to higher unemployment and stagnation. Also, low inflation increases the burden of servicing debt. Indeed, with deflation the real interest rate starts rising. When nominal policy rates are close to the zero lower bound, higher real rates cannot be corrected by reductions in policy rates. The prolonged period of low inflation in the euro area since 2014 has prompted the ECB to introduce unconventional monetary policy measures (See Chart 6). Chart 6 – HICP inflation  These complement the reductions in the main policy rate so as to maintain an accommodative monetary stance. In January 2015 the ECB announced the launch of the Asset Purchase Programme (APP), first encompassing ABS and covered bonds, and later extended to the purchase of sovereign bonds. At the euro area level, the ECB’s monetary policy strategy has gradually improved financial and credit conditions, as well as the ongoing economic recovery. The non-standard measures have resulted in higher equity and bond prices, higher liquidity and improved lending conditions. Since June 2014 the transmission of policy rates to lending rates has improved, with declines in lending rates becoming more pronounced and more widely distributed across euro area countries.

Malta has the ability to develop a regional cluster in these areas, attracting students and patients from the region and beyond. This year we have seen a significant correction in the exchange rate, which is expected to exert a positive influence on economic growth in the year ahead. There are other major elements that add to Malta’s positive outlook. In addition to being an efficient and profitable international business location, Malta is a meeting point of cultures and languages at the centre of the Mediterranean. There is, therefore, potential for further development of economic activities that exploit our location, our strengths in doing business from Malta that add value to current activities, such as, for example, developing further cultural niches in the tourism sector so as to maintain a vibrant and evolving economy. Thank you  BIS central bankers’ speeches  9
The price of entering goes up, or the Bulgarian thorny road to the euro Yes, some new EU members are still keen to join the Eurozone. Especially in Bulgaria, the desire is understandable: the country has held a fixed exchange rate visa-à-vis the euro since the common currency’s inception. Just like Denmark, Bulgaria has outsourced its monetary policy to Frankfurt, but unlike Denmark, it would also like to become an official member of the club to enjoy all the benefits of using one of the most prestigious world currencies. On paper, at least, Bulgaria appears to be an ideal candidate: unlike many of the current members of the Eurozone, it actually fulfils the key Maastricht criteria. But the idea of Bulgarian membership is not an appetizing one to many technocrats at the ECB and to the representatives of some Eurozone member states. So, for many years, Bulgarians have been tacitly discouraged from applying to ERM II, the antechamber of the euro. This year, however, they tried their luck: perhaps they felt that the conditions would never get any better than under Bulgarian presidency of the EU and Jean-Claude Juncker’s vocal emphasis on how the euro should become the currency of the entire Union. Complicated negotiations followed, and their result is of key importance to all EU member countries outside the Eurozone. It’s not enough that Bulgaria fulfils the important Maastricht criteria: new criteria were thought up specifically to make the Bulgarian path to the euro as difficult and humiliating as possible.

There is substantial scope in the region for brokers to better understand the risk profiles of SMEs – specifically how they are affected by loss events and what it would take for them to recover – and to work with insurance providers to lower the costs of insurance through innovative solutions and better data. A key focus of Bank Negara Malaysia in the coming years will be to provide an enabling environment for insurance brokers in Malaysia to develop the technical, financial and operational capacity that will enable them to effectively support businesses in both mainstream and niche areas under the new economic landscape. In this connection, the Bank will be introducing new measures to foster greater competition, and expand opportunities for brokers to forge strategic partnerships for long term growth. This will include specific measures with respect to foreign participation in the insurance and takaful broking industry in line with the recommendation of the Bank’s Financial Sector Blueprint 2011 – 2020. The Bank expects to make further announcements on this in due course. BIS central bankers’ speeches  3  The evolution of insurance broking also raises important questions for managing conflicts of interest. Insurance brokers are often well placed to offer a broad range of services that may go beyond advising on and securing insurance solutions. These include an expanded role in risk consulting and management, the administration of employee benefit schemes, and claims handling services provided for a fee.
2.2  Draft Budget: projected revenue  On the revenue side, the Draft Budget proposes a broad raft of legislative changes to existing taxes, including in particular a higher rate of personal income tax and wealth tax for higher income earners, a limit on double taxation exemptions for large corporations, a minimum tax rate of 15% on the tax base of SOCIMIs (Spain’s real estate investment trusts), and higher taxation of hydrocarbons (focused on diesel oil for non-professional use) and other environmental taxes. On official estimates, these measures combined will raise public revenue by some € billion in 2021. 21  The Draft Budget also reflects the impact on revenue of the financial transaction tax and the tax on certain digital services, both approved recently, and of other new taxes, such as, for example, the tax on non-reusable plastic containers and on landfill waste. On official estimates, the impact on revenue of this set of instruments would amount to some € billion in 2021. As in the case of the expenditure items, I will not examine in detail the different revenue heading measures individually, but will confine my analysis to three questions that I believe to be very important, namely the overall direction of the tax changes introduced, their appropriateness, and the risks surrounding their revenue-raising capacity. First, regarding the nature of the tax changes introduced in this Draft Budget, I wish to reflect on the appropriateness of the timing of the changes proposed and on the specific instruments used.

Insofar as they are used efficiently, these programmes represent an opportunity to shore up economic recovery and employment in the short term, to speed up the structural transformation towards a higherproductivity economy, and to address the socioeconomic consequences of the crisis and limit their duration. 12 13  An alternative would be to link the legal retirement age to life expectancy developments, as in Italy and Portugal. See the Banco de España’s 2018 Annual Report. 34  However, I must stress the need to ensure that these programmes are used appropriately. In particular, the receipt of these European funds in the coming years should not blind us to the need to undertake fiscal consolidation. Given the temporary nature of these funds, even if used efficiently they cannot be a substitute for the necessary adjustments, although they may ease the cost of these adjustments across several dimensions. First, assigning the funds to projects that will increase our economic growth potential will help expand tax bases. Second, the available evidence shows that the more favourable the cyclical position when fiscal consolidation is undertaken, the lower the costs of that consolidation; the projects developed using the European funds should help us achieve a more favourable cyclical position. As I have explained earlier, economic policy measures must continuously adapt to changing circumstances. In addition, they must also help the economy adjust to the new postpandemic setting.
Over 900,000 jobs were added in March, and I am hopeful that we will see very strong job gains over coming months as the economy continues to reopen. It is very encouraging to see people getting back to work and to see these gains starting to be more widespread, including in the sectors and regions that were hit hardest by the pandemic. But, even with the gains that have occurred, let’s not forget that there are about eight and a half million fewer jobs today than before the pandemic. To put that number in context, this is a shortfall similar to what we saw at the worst point of the aftermath of the Great Recession. This means we will need big jobs numbers for some time to fully get the country back to work. The labor market indicator that gets the most media attention is the unemployment rate. But that statistic may not be the best measure of the overall health of the labor market because people who temporarily drop out of the labor force don’t get counted as unemployed. It’s vital that we look at a wide range of indicators to gauge the health of the labor market. One measure that I find useful is the employment-to-population ratio, or “EPOP” as it’s affectionately known. EPOP is the share of the population that have jobs according to a monthly survey of households. Before the pandemic, when the labor market was quite strong, EPOP was about 61 percent.

In terms of the federal funds rate, the FOMC said it expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the FOMC’s assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time.1 Maintaining very low interest rates serves two purposes. First, it makes it easier for households and businesses to meet their borrowing needs, for things like opening businesses and buying homes. Second, low interest rates foster broader financial conditions that help promote the rebound in spending and investment needed to return the economy to full strength. In particular, we are seeing positive effects from monetary policy on the demand for durable goods and homes. Our policy response, alongside vaccinations and fiscal support, has played an important role in putting the economy on a solid path forward. For those asking if we’re there yet, I’ll leave you with this. Although we still have a long road ahead of us to achieve a robust and full recovery, with strong support from monetary policy, I am confident we will reach our destination. Thank you, and I look forward to your questions. 1 Board of Governors of the Federal Reserve System, Federal Reserve Issues FOMC Statement, April 28, 2021. 3/3  BIS central bankers' speeches
Although our decision considered the option of waiting, signaling the possibility of this change before doing it, we believe that in the current situation taking immediate action had greater value. Not because the economy was deteriorating dramatically, but because we were convinced of the consistency of this analysis with the persistence of low inflation. In such circumstances, delaying a decision would only be a waste of time, at a cost to the economy, at a time when more, not less, certainties are required. Page 8 of 18  The adoption of the agreement at the Friday meeting had a communicational implication that surely did not escape the attention of the members of this Commission. Faced with an important decision and unforeseen by the market, it was very complex to postpone the dissemination of the background information that supported it for more than two days, until the release of the Monetary Policy Report. That led us to issue a statement that advanced some important data of the Report. I would like to be clear that this does not set a precedent for future opportunities in which the monetary policy meeting and the Monetary Policy Report will coincide. Any more permanent change to the strategy of monetary policy communication will be assessed in depth and we will discuss it beforehand with this Commission.

On the demand side, the main changes in the first quarter were the slowdown in investment in machinery and equipment and in exports (Figure 2). This coincides with the deterioration of the external scenario in recent quarters and an inventory buildup that has not been undone as expected. On the other hand, investment in construction and other works and consumption evolved as expected, without major changes compared to the previous quarters. All in a context where various indicators show an increase in job creation. Headline inflation as measured by the CPI and core inflation (CPI excluding food and energy, CPIEFE) continue near 2% per year. In the case of the CPI, with a level that has increased somewhat in the most recent past (Figure 3). In any case, the same phenomena identified in the March Report are still present: greater competition in certain markets, wider capacity gaps than previously estimated and lower pass-through of the accumulated peso depreciation than its historical averages. II.2. Updating the structural parameters As I just said, in this Report we have updated the estimates of the structural parameters that are used to assess the state of the economy, its outlook and the calibration of monetary policy. This allowed mainly to quantify the effect of the massive immigration flow of recent years on trend and potential growth, increasing both. It was also possible to compare the impact on the neutral MPR of a higher trend growth with that of the fall in international interest rates.
BIS Review 135/2010  3  Debt Management Office (DMO) and attempt to sell the same gilts to the Bank at a higher price. The first mitigant was that the MPC set a targeted rate of purchases initially three times faster than the DMO were issuing. In addition we incorporated several features into the design of the operations: (i)  We designed the operations as competitive (reverse) auctions that would deliver a clearing price close to the market. (ii)  We offered to buy from a bundle of 8–10 individual gilts in each operation not just a single stock at a time. The selection of which gilts we then bought depended on the prices offered. In that way, the purchases were less vulnerable to a “squeeze” in any one particular gilt. (iii)  We eliminated from the operations any gilts which we knew the DMO were about to issue or had issued in the previous week. Maintaining the programme I don’t want to imply that implementing and maintaining our programme of asset purchases was straightforward operationally. Far from it. For example, the gilt market became somewhat more dislocated as the Bank accumulated a large percentage of some of the particular gilts in issue. To alleviate stress in the market, in August 2009 we started to lend out, via the DMO, a proportion of the gilts the Bank had bought, in exchange for others that had readier availability.

Distinguished participants, recent industry estimates indicate that Islamic finance is set to continue growing at an annual rate of about 15%. The increased trade between the subSaharan region and Islamic nations in the Middle East only reinforces our view that partnerships among the corporate players between the two regions will foster more developments in the area of Islamic finance. Ladies and gentlemen, the Government of the Republic of Zambia (GRZ) recognizes that the limited access to financial services and low number of products available to the different sectors of the economy has hindered the development potential of Zambia’s economy. There is need therefore, to revitalize the financial sector so that it meets the challenges of accelerated and sustained investments in key sectors of the economy. This can only be achieved where the financial system is able to improve its allocative efficiencies by providing appropriately designed products and services to all segments of the population like the Muslim community. Recent developments in the financial sector world-wide offer some encouragement that working together could extend the range and reach of financial services that are available to our people. Still a lot remains to be done to extend financial services to the majority of our people, particularly those that are economically active and to foster ongoing sustainability of our financial institutions. It is against this background that Bank of Zambia accepted your invitation to present the keynote address as a way of marking our commitment to ensuring that the financial system caters for all segments of the population.
Although LIBOR and some other spreads are wider, they are, on average over time, generally stable and slow-moving, and as a result forecasters are able to incorporate any effect these spreads might have when formulating their projections for monetary policy. Changes in the policy rate continue to be passed through predictably into all these markets, as recently observed. Transitory, predictable and non-disruptive increases in period-end volatility are unlikely to meaningfully affect the real economy. And finally, there is evidence that the wider spreads among market rates that came out of money market fund reform are gradually closing over time, as firms adapt to the new structure of money markets by adjusting their portfolios and identifying new counterparties. However, if market dispersion were to increase too much, this could cause a variety of challenges. Such dispersion could affect monetary transmission, altering the price of credit made available to certain borrowers. This could complicate the formulation of monetary policy if it were to become harder for policymakers to anticipate the impact on the economy that would ensue from future changes to the federal funds rate. Such dispersion could also affect the use of our operations.37 As I have noted, it seems that much of the recent shift in money market dispersion has arisen as a byproduct of important regulatory improvements to improve the safety and soundness of the global financial system.

Let me now turn to the other side of the coin. Despite the above examples of areas where good prospects may arise for market activity, there are also elements of uncertainty on the horizon, and one of them is Brexit. Brexit On 29 March 2017, the United Kingdom notified the European Council of its intention to leave the European Union. This means that 30 March 2019 is, in principle, the “withdrawal date”. So far, in the draft Withdrawal Agreement, there is no specific regime with regard to financial services and this unquestionably generates a context of uncertainty that affects all market participants. Allow me to focus on how it affects banks. “Wait and see” is not an option. Banks need to prepare. Within the framework of the Single Supervisory Mechanism (SSM), the ECB, together with National Competent Authorities, is trying to communicate, to banks which may be considering relocating their banking activities to the euro area, the SSM’s supervisory expectations on different aspects such as: authorisations and licences to carry out banking activities in the euro area; internal governance and staffing arrangements; or authorisations and use of internal models. These expectations have a key underlying principle, which is the need to guarantee consistency across the existing and the relocating institutions, so that they both operate under the same regulatory, prudential and supervisory standards. There is another key aspect, which is the need to ensure that relocating banks are not empty shells.