samchain/econo-pairs-v1 huggingface dataset:
Clearly, greater use of the local system for real-time settlement of Hong Kong dollar versus US dollar transactions would bring real benefits in terms of reduction and diversification of risk. Banks in Hong Kong will no doubt be looking seriously at their existing settlement arrangements for such transactions, and at the greater use they can make of local services to achieve finality of settlement for the currencies simultaneously in our time zone. For our own part, the HKMA will continue to develop and reinforce our local financial infrastructure and to link it more efficiently with global systems. We have, for example, started on the development of a two-way linkage with Euroclear, one of the world's largest central securities depositories. The two-way linkage, which will be highly automated for heavy usage, will enable investors in the Asian region to gain trading access to securities lodged with Euroclear. The infrastructure providing for payment and settlement form the essential roads and bridges that connect banks and other institutions with each other. What of the banks themselves? In Hong Kong, they have seen declining profits at a time of increasing competition. Yet the banking sector remains remarkably strong, with an average capital adequacy ratio of 18%. With good reason, the general public, and the international financial community, have a very high degree of confidence in Hong Kong's banks.

The impetus to growth will therefore increasingly need to shift to domestic demand, which is already enormous, and which has been growing quickly in recent years. For the medium and longer terms, dynamic and far-reaching economic transformations will be set in motion by China's accession later this year to the World Trade Organisation. As a result of accession, China's trade flows are projected to double between now and 2005. There will be profound changes in the financial landscape, including an increased presence of financial institutions. BIS Review 88/2001  1  All this is, as I have pointed out before, good news for Hong Kong. It will, we estimate, increase our annual GDP by around half to one per cent, just through the resulting increase in re-export trade. It should additionally provide a great boost to our professional, mediatory and service industries. Those who despair about Hong Kong's future viability should perhaps reflect on the opportunities that our position as China's international city will bring post-WTO accession. Yet it is understandable that the focus of attention should currently be on immediate problems rather than on future benefits. The rapid deterioration of the external environment now threatens to prolong the cyclical downturn in Hong Kong, engulfing the vigorous, but all too brief, resurgence last year. Growth this year is likely to be in negative territory again, and price deflation is expected to persist. Such a prolonged downturn is unprecedented in Hong Kong's recent economic history.
Mugur Isărescu: The future of central banking Address by Mr Mugur Isărescu, Governor of the National Bank of Romania, during the plenary session “The future of central banking”, 8th World Policy Conference, Montreux, 20 November 2015. *  *  *  Parts of this address have been presented by Governor Mugur Isărescu during the plenary session “The future of central banking”, which also featured as speakers: •  Jean-Claude Trichet – former President of the European Central Bank  •  Jacob Frenkel – Chairman of JPMorgan Chase International, former Governor of the Bank of Israel  •  Marek Belka – President of the National Bank of Poland  Ladies and gentlemen, It is a great honour to address the audience during this symposium on the future of central banking, although I must confess from the very beginning that the topic itself is not easy to tackle. We all know that economists seldom reach a consensus when analysing the past. It is all the more difficult for them to agree on the future, especially when we refer to central bankers, who are known to be among the most cautious economists... Personally, I think I have enough reasons to be wary of any predictions of what is in store for us, particularly over the medium and long term. I started my career as an economist in a research institute back in August 1971, when the Bretton Woods System was just collapsing.

If the importance of macro-prudential instruments was revealed by the global crisis and the forex interventions of central banks went back in fashion during the same period, there is a fact well known from the conventional economic wisdom, but highlighted once again by the crisis: the countercyclical stance of both monetary and fiscal policies is essential for ensuring a smooth trajectory of the economy. We all saw how unsustainable public finances and high levels of debt have impeded the effectiveness of a stability-oriented monetary policy. This was also the case of Romania, where the fiscal impulse was positive during the period of rapid growth before the financial crisis, contributing to the overheating of the economy and fuelling the imbalances accumulated in the economy. Moreover, the pro-cyclicality of the fiscal policy during the pre-crisis period exhausted the fiscal space needed to stimulate the economy in recession, leading to the need to reduce the budget deficit during the crisis (primarily due to financing constraints) and to perpetuating the pro-cyclicality of fiscal policy. As stated by Fritz Zurbrügg (2012), successful monetary policy is predicated on healthy fiscal policy, and vice versa, and to achieve stability and prosperity in the long term, fiscal and monetary policies must both focus on sustainability. In the past, the high fiscal deficit has resulted in the fiscal dominance of monetary policy with its inevitable monetisation of the government debt, but nowadays most central banks no longer directly finance government expenditure.
The crucial factor to succeed in the global knowledge economy is the country’s ability to develop intellectual capital. Only those who understand the importance of innovations for growth will thrive and prosper in the coming decades. Unfortunately, CEE region lags badly behind the leaders in terms of its current and future ability to generate innovation. One of indicators measuring current ability to innovate is the number of researchers. In the mid-1990s CEE-4 (the Czech Republic, Hungary, Poland and Slovakia) and Asian NIEs had similar number of researchers per million people, while two years ago NIEs had almost twice as many persons employed in R&D per million people in comparison with CEE-4. Future knowledge potential of particular country or region can be measured by tertiary enrolment ratio. Tertiary enrolment ratio in the CEE-4 countries improved to 50 percent in 2004, but still remains well below 62 percent in the EU-15 and 82 percent in the United States.. Because of a relatively small population and a number of structural deficiencies it is very unlikely, that increase in the number of students in CEE-4 that have occurred in recent decade will translate into higher innovation potential in the coming years, unless a dramatic change in policies in CEE-4 is made. This is also confirmed by a dramatically low number of patents registered in the CEE countries and extremely low number of scientific publications.

Spiegel online on 26th September 2007 described a research led by the Nobel-price winning chemist Paul Crutzen which had found that biofuels emit even 70 percent more greenhouse gases than fossil fuels. In effect, global warming may accelerate and lead to further increase in frequency of disasters such as floods, droughts, and unexpected weather changes that may have negative  1  Views presented today are my own and do not necessarily represent the official position of the National Bank of Poland and the Polish Financial Supervision Authority. 2  Rybinski K. (2007) “The Role of the EURO for the Future of Poland”, speech by Krzysztof Rybinski, Deputy Governor of the National Bank of Poland, 15 June 2007, http://www.nbp.pl/publikacje/wyklady/rybinskiadesti.pdf  BIS Review 138/2007  1  effects on crops. Secondly, food prices will be lifted up by an increasing demand for agriculture products in the emerging markets, especially in Asia, as the catching-up process progresses. It is worth keeping in mind that the share of food in the CPI basket is some 10 pp. higher in Poland than in the eurozone, so agflation, if it materializes, will lead to inflation divergence. 2. One cannot exclude a possibility that other commodities prices may continue to rise as well. Demand for commodities has already substantially risen in recent years. The “problem” lies again in the emerging markets. Fast growing economies create still growing demand for all sorts of commodities, especially metals and fuels (for example: oil consumption in China has doubled within last 10 years).
The second risk unfortunately follows from the first, namely that increasing pressure on interest margins can tempt lenders to seek higher returns on assets through riskier loans, and to concentrate more on short-term funding thereby increasing the mismatch. We saw this before the financial crisis broke in 2007 as lenders ventured into higher LTV, sub-prime and commercial property lending without having adequate risk management in place. We also saw this in the late 1980s and early 1990s. This diversification was generally not successful, and in some cases fatal. Since the height of the crisis societies have generally reduced their commercial property loans, and non-prime has declined too. The main area of growth has been buy-to-let lending, which is true not just for societies but for lenders in general. Now, I don’t want to demonise buy-to-let lending. We are watching carefully, and for the societies we see no evidence today that BTL loans are of poorer quality than prime owner-occupier, and we see a fair amount of stability over time in maximum LTV and minimum rental cover. But, we are watching carefully, and of course applying stress testing across all loans. Looked at more broadly, we are not seeing an upward surge in high LTV lending of the sort that was so damaging in the past, but there is an upward direction to the – admittedly small – share of lending at high LTV and high loan-to-income (ie the two together).

Of course, I am now going to go on to talk about risks, but before I do let me say that this sort of performance doesn’t happen by accident. But it does show that there is a role for mutuals and one that can succeed. Of course, a lot of hard work goes into achieving these results. On our side, I can also say that Martin Stewart and his colleagues put a lot of hard work into our role, which is founded on sensible forward-looking judgement consistent with our objectives in statute. So, what can go wrong – the risks? The first area that I would highlight is the potential for margin pressure. Most forecasters see continued growth in the mortgage market as the most likely development, but at a lesser pace than in recent years, which is consistent with actions taken by the Bank of England last summer to limit the growth of borrowing by highly indebted households. Competition in the mortgage market is growing, and for instance rates on two year fixed rate mortgages are at a record low. On the liability side, wholesale funding costs are low, and on much of the evidence they are below retail funding costs on average, and that tends to benefit lenders with greater access to wholesale funding. Therefore,  BIS central bankers’ speeches  1  notwithstanding the news on interest margins over the last two years, we are watching this story carefully to see what happens next.
Capital adequacy and liquidity regulation are thus two sides of the same coin. Just as it would be impossible or uneconomic to require banks to operate without risk to provide total certainty of solvency, so liquidity regulation is needed as a form of insurance. The issue is discussed in an article in the December edition of the Bank's Financial Stability Review. The Basel Supervisors' Committee has done valuable work in examining issues and techniques in liquidity management and this work deserves to be carried forward further. For those of you who have already digested the 500 pages of the new Basel Accord we are discussing today and are looking for some more recreational reading, over the Easter holiday, I thoroughly recommend a re-read of the update the Basel Committee published last year of its sound practices for managing liquidity risk. In the meantime, thank you for allowing me to address you this morning. BIS Review 29/2001  5

5 April 2018  Speech Már Gudmundsson, Governor of the Central Bank, delivered at the 57th Annual Meeting of the Central Bank of Iceland, 5 April 2018. Mr. President; Prime Minister, other Ministers, Speaker of Parliament, Directors and Ambassadors; Ladies and Gentlemen! The Icelandic economy has been in fine fettle recently, with full employment, to say the least, as we have had to import a large number of workers to support economic activity. The risk of overheating has receded somewhat in the past year, however; the positive output gap has narrowed, and the residential housing market is less stretched than it was a year ago. Until last month, inflation had been close to target but below it for four years running. Inflation expectations have been at target by most measures in the recent past. It is this that has enabled the Bank to lower its policy interest rate by 0.75 percentage points since our last Annual General Meeting. Inflation expectations have fallen to the target and have become more firmly anchored there, reflecting the success of monetary policy in the recent term. The Bank’s Chief Economist recently published a Working Paper explaining this success, noting as well that the decline in inflation to the target between 2012 and early 2014 was virtually costless, partly because of increased credibility of monetary policy.1 If changes are made to the monetary policy framework in the coming term, it is important to preserve this success.
The message is that the MPC makes interest rate decisions one at a time, and that it has not made up its mind about what future path of rates will be consistent with the inflation target. The market interest rate path too is a conditioning assumption, not the MPC’s prediction about future rates. The difference is that, to the extent that the market rate curve embodies the market’s guess about where the MPC will take rates, forecasts predicated on the market rate are more easily interpreted as a comment on that view. So how much significance should be read into our change of conditioning assumption? Did the switch to market rates represent a tentative step towards providing more guidance on the future direction of policy? The fact that interest rates were historically very low in 2003 and early 2004 has some bearing on the matter. Many academics, notably Lars Svensson, have argued persuasively that the use of an unrealistic conditioning assumption makes it more difficult for the public to interpret the MPC’s reading of the economic outlook. As Charlie Bean has pointed out,17 this is certainly true if interest rates are some way off ‘normal’ levels or if for other reasons, they are expected to increase or decrease substantially over the forecast horizon – and the longer the time horizon of the forecast, the more force this argument has.

This is specially so in emerging markets, where regulatory and political risks heighten the likelihood of default, transaction lead times are long, projects require prohibitively large amounts of start-up capital, and there is limited access to expertise in project development and financing. Second, we need to reduce the risks in marginally bankable transition projects to attract private capital. The return profile on many such projects is not commensurate with the risks facing private financiers or investors. To reduce overall risk and improve bankability, we need more catalytic and concessional funding from the public sector, multilateral development banks, and philanthropic sources. Such funding can be in the form of grants, risk-sharing arrangements, debt at below-market rates, technical assistance, and structuring advice. They can help crowd in additional multiples of private sector funding. But while public capital can potentially do more to mitigate risk, private capital must still bear a fair share of project risk and exercise the appropriate due diligence on project viability and performance. Third, we need to make the financial ecosystem work more synergistically. Banks play a key role as lead managers for financing sustainability projects. However, with limited balance sheets and regulatory capital and liquidity requirements, banks need to offload these loans to institutional investors who have more absorptive capacity. But institutional investors prefer larger deal sizes with a diversified pool of assets to reduce concentration risk. We need to shift towards a portfolio approach to blended finance deals, through the structuring and securitisation of typically illiquid green and transition assets.
Even in developed countries, there remains minorities that have limited access to basic financial services. For instance, a study conducted in the United Kingdom for the period 2002-2003 found that 2.8 million adults in households had no access to a bank account. In relation to this, regulators have to balance between the need for financial institutions to operate efficiently and the need to ensure access to basic financial services for both individuals and small businesses. In addition, rural communities have also tended to be underserved. The challenge confronting regulators is to ensure that all communities have access to financial services. This greater inclusion is vital to bring the lower income groups into the economic mainstream. An important aspect in the development of a consumer protection framework is to ensure that the framework remains relevant despite changes in economic and financial environment. Changes in the profile of consumers following changes in the demographic structure for example needs to be taken into account. In most communities, the ratio of retired population relative to working adults is expected to rise more steeply in the next decade. In countries with growing ageing populations, there is an increasing demand for financial planning, life insurance, wealth management and mutual fund investment services. Consumers' interests in these areas would need to be adequately safeguarded while financial literacy among the various target groups need to be actively promoted.

The consumer education efforts are also complemented by initiatives to promote a higher level of disclosure and transparency so as to ensure that consumers have access to relevant, comparable and timely information on products and services. A significant focus has been on the insurance sector, given that a significant segment of the Malaysian consumers do not have good understanding of insurance products. In particular, guidelines on medical and health insurance and the requirements for marketing of life insurance policies, have been strengthened while rules for independent financial advisers have been introduced. In meeting socio-economic objectives, there is also a need to ensure that the welfare and interests of all segments of society are protected and that no target group is excluded or marginalised. Indeed, an important component of our consumer protection framework is to ensure that all consumers continue to have access to basic banking services at reasonable costs. In this connection, a more interventionist approach has been pursued to require banking institutions to offer a list of basic banking services to all Malaysians and to set guiding principles for the imposition of fees and charges for these retail products and services for individuals and small and medium sized enterprises. Efforts have also been taken by the Central Bank in collaboration with the financial services industry to enhance the integrity of the payments systems and instruments, aimed at promoting confidence and ensuring that consumers' interests are safeguarded.
The important role of emerging economies. The world economy is now more balanced between advanced and emerging economies. Measured in PPP terms, China is the world´s first economy, representing 18% of global GDP, and Russia the 6th (3% of world GDP). We share the same world economy but our respective economic structures and cycles differ. We need a shared analysis, to learn from our respective experiences, and it is crucial that international coordination and regulation take into account our realities. 6/6

The goal of this Regulation is to ensure a more rigorous regulatory treatment of issuance and transactions with some types of crypto-assets and the crypto-asset service providers will be subject to authorisation and control. The long-term trends in Europe are related to achieving a greater integration and autonomy of the European payment system. In its centre are positioned the instant payments and application of common technical and business standards across Europe. Bulgaria is an active participant in these processes. EU initiatives for development of retail payments are in the process of implementation on our domestic payments market. A still open question is whether the changes in the people’s payment habits will stay as a permanent feature and will set a direction for the forthcoming technical developments in the payments sector. In this very dynamic area the EU regulators will continue playing an active role. I wish interesting and productive work to all the participants in today’s financial forum. 2/2  BIS central bankers' speeches