samchain/econo-pairs-v1 huggingface dataset:
Undoubtedly this is the strongest countercyclical macroeconomic policy response we have ever implemented to a shock of this magnitude, and it was possible thanks to a sound corporate sector, a well-capitalized and resilient financial sector, and a solid position in terms of international liquidity. Importantly for the discussion ahead, this was the result of careful regulation and supervision of individual financial institutions. This scheme hails back to the banking crisis of the 1980s, and it has been constantly adapted and improved since then. In Chile, financial services are regulated and supervised by different institutions according to the type of service; securities and insurance, the pension system and unemployment insurance, and banks. In the case of banks, the Superintendence of Banks and Financial Institutions and the Central Bank are in charge. Different schemes have been designed to facilitate coordination between institutions. This effort has led recently to the creation of the Financial Market Commission, which will be headed by an autonomous board of directors and will transform the financial supervision and regulation scheme to an integrated one, with a systemic view of the stability and risks facing the financial sector and more flexibility to deal with critical situations. The Central Bank of Chile enjoys a special independent status under the Bank‘s Constitutional Organic Law. Besides specific regulatory tasks with regard to the banking sector, the Central Bank oversees the foreign exchange regulations and monitors closely and 4  constantly all the industries making up the financial sector.

3  As the 2007 financial crisis unfolded and its effects spread-out, this framework helped us to avoid large costs and evade financial problems despite our strong ties with the global economy. In the aftermath of the crisis the local currency depreciated around 45 percent in seven months, while the monetary policy rate was reduced from a relatively high level of 8.25 percent in December 2008 to a point five percent in July 2009, remaining there for about a year. Together with lowering the interest rate, the Central Bank implemented a program of liquidity provision that significantly reduced the market interest rates to a level much closer to the monetary policy rate. Additionally, in the middle of 2009 it established a term liquidity facility for banking institutions, granting 90- and 180-day liquidity at the prevailing monetary policy rate, signaling a more expansionary path for the monetary policy rate than the market expected. The active monetary policy response, together with an expansionary fiscal policy, favored by a healthy fiscal position that was achieved thanks to a fiscal rule where expenditures are determined as a function of long-run copper prices and economic growth, facilitated a rapid adjustment. After only one period of negative annual growth in 2009, the economy was able to sustain growth rates above 4 percent in the years that followed. The inflation rate fell well below the target range for about a year, but inflation expectations remained well anchored at our target of 3 percent in the two-year horizon.
Finally, allow me to express once again my gratitude to the co-organizers of this event for making the conference possible, and to wish all the participants a very fruitful meeting and a pleasant stay in Madrid. And without further due, let me now introduce our first speaker, Governor Philip Lane. It is a special honor for us to have him here today. He is especially suited to be our first Keynote Speaker in this event because he has a profound knowledge of economy and finance, as a result of his long and prestigious career as an academic, as well as a brilliant policy-maker. His keynote speech today will verse about “Trends and Cycles in Financial Intermediation”. Philip, you have the floor...  10  For more information on the impact of FinTech on the finance industry see Philippon, T., “The FinTech opportunity”, NBER Working Paper, No 22476, 2016; and Huang, Y., Shen, Y. Wang, J. and Guo, F. , “Can the internet revolutionise finance in China?”, in Song, L., Garnaut, R., Fang, C. and Johnston, L. (eds. ), China’s new sources of economic growth: reform, resources, and climate change, Australian National University Press, 2016, pp. 115-138. 6/6

This move by the HKMC to issue USD denominated bonds fits very well into the efforts by the Hong Kong Monetary Authority to promote the development of a safe and efficient financial infrastructure for Hong Kong, based on a multi-currency, multi-dimensional platform. In Hong Kong’s banking system, we have around $ trillion in HK Dollar deposits. Our banks also have the equivalent of over $ trillion in foreign currency deposits. About 70% or $ billion are US Dollar deposits. The loan-to-deposit ratio for Hong Kong Dollar deposits is 87%; the equivalent for US Dollar is only around 26%. We reckon that a significant portion of the sizable US Dollar deposits is held by retail investors and some would wish to diversify and look for investment products to increase their return. One could of course look for opportunities overseas but, as an international financial centre, Hong Kong should also try to provide more such investment products locally. In the past there have been very few local issues of US Dollar retail bonds, and the most recent one appears to have been issued as far back as in September 2003. Today’s HKMC US Dollar bond issuance would help to meet part of such investment demand. Perhaps in times to come there will be more foreign currency bond issuance in Hong Kong. This bond issuance would add to the diversity of financial intermediation channels and complement the HKMA’s effort to promote the development of a multi-currency, multi-dimensional financial system in Hong Kong.
In recent years regional central banks have also built up a large addition to their foreign reserves. Such a large pool of domestic savings should be channeled into long-term investment in the domestic markets to support growth and development in the region. At present however, the dominant financing tools in most Asian countries still continues to be short-term bank loans, and bond markets in the region still remain underdeveloped. The bulk of local savings has instead been channeled to international financial centers with a wider alternative for investment and well-developed financial markets. At the same time, Asia is a recipient of short-term portfolio flows that had been destabilizing and highly volatile. These funds have further aggravated the problem of maturity and currency mismatches making the region more vulnerable to fluctuations in international capital movements. Creating a more stable financial system Developing regional bond markets for Asia: Asian savings for Asian investment Efficient and liquid bond markets in Asia - both at the local and regional levels, would enable the private sector as well as the public sector in Asia to raise and invest long-term capital without the currency and maturity risks which accompany international capital flows into the region. Development of regional bond markets will help governments and businesses in the region reduce currency and maturity mismatches.

Aside from providing stable and long-term financing alternatives for businesses and public sector agencies in the region, this would also help strengthen the financial system in the region by making available a diverse choice of alternatives for investment, as well as support economic growth through more stable financial systems in the region. 2  BIS Review 24/2003  The necessity to develop a regional bond market While many countries in the region have begun the process of developing bond markets – or where they exist already, deepen and widen those markets – countries are also looking to promote the development of the regional bond markets in parallel with development of their own markets. Given the problems of economies of scale as mentioned earlier, development of the regional bond markets would offer a more efficient and viable option in neighboring countries until these countries’ financial systems are more developed and have a more sophisticated market structure in place. Roadmap for the development of Asian bond markets Over the past year, the development of Asian bond markets has been discussed in various international fora, such as ASEAN Finance Ministers Meeting, the Executives Meeting of East Asia-Pacific Central Banks (EMEAP), Asian Cooperation Dialogue (ACD), and the Asia-Pacific Economic Cooperation (APEC). Development of the demand side, involves promoting the pooling of investor base or the pooling of reserves under the Asian Bond Fund initiative, which has had a good start under the cooperation of central banks.
This will also turn down the heat in the labor market, reducing the imbalance between job openings and available labor supply. 2/4  BIS - Central bankers' speeches  While the Federal Reserve on its own cannot address the global nature of inflation, we are not acting alone. Many other central banks are also taking steps to curb inflation. Taken together, these actions should help restore balance to supply and demand globally. That, in turn, should help diminish supply-chain bottlenecks and reduce inflationary pressures. Taking Action In the United States, the FOMC is taking strong actions to restore balance and bring inflation down. So far this year, the FOMC has raised the target range for the federal funds rate by 75 basis points, including a 50-basis-point increase announced after our meeting last week.1 In addition, the FOMC has indicated that it anticipates that ongoing increases in the target range will be appropriate. I expect the FOMC will move expeditiously in bringing the federal funds rate back to more normal levels this year.

At the outset of the Conference, it has been clearly articulated by our EU speakers that the enlargement of the EU and the economic and monetary integration of acceding countries will not only strengthen the role of the EU as a global player in the long term, but also make a sustainable contribution to global stability and prosperity. On the developments and prospects for ASEAN, our ASEAN speakers have more than stressed that the overall economic and financial transformation that has occurred in ASEAN since the Asian financial crisis has resulted in an ASEAN that is a mutually reinforcing region of growth; an ASEAN that has an increasing role in the creation of wealth; and an ASEAN that will remain as an important region in promoting and supporting global stability and growth. This Conference has revealed to us that both our regions are currently at the confluence of favourable factors; factors that have led to a marked expansion in the base of opportunities that we can offer each other. It is imperative that our discussions on taking advantage of the emerging opportunities be translated into concrete actions. We are of course aware that implementing these actions will demand decision and leadership from both ASEAN and the EU. From the proceedings of the Conference, it seems to me that there may be a need to develop a more entrenched mechanism to leverage further on our respective core capabilities and which seeks to find simpler, faster and more effective ways that would enhance our joint endeavours.
One consequence of pricing in a single currency in all member countries will be to facilitate buyers of goods and services greatly in making price comparisons, and competition within the EU will certainly become more active than it has been until now. Economic and Monetary Union The EMU has a population of more than 300 million and accounts for 16% of global GDP. By way of comparison, the USA has a population of 280 million and accounts for 22% of global GDP. Exports of goods and services are equivalent to 19% of EMU GDP, while the corresponding figure for the USA is under 11%. Some 19% of total world merchandise exports come from the EMU, and 15% from the USA. Twelve of the fifteen EU nations belong to the EMU. The UK, Denmark and Sweden remain outside it, but their positions differ somewhat. Denmark and the UK have stated reservations about membership, on which they have reached agreement with other EU states. Sweden, on the other hand, has opted to remain outside the EMU, although no special reservations have been agreed upon for them. Denmark is involved in currency cooperation with the EMU, one aspect of which is that the exchange rate of the Danish krone may not deviate from the Euro by more than 2.25% from a defined central rate. Denmark therefore enjoys limited monetary independence.

Technically, this project is a real challenge and it will contribute to the definition of smartcontract standards for the automation of tokenised financial markets and the interoperability of CBDCs. These standards are necessary to allow the tokenisation of finance to take off securely and to reduce fragmentation in this environment. In case of success, project Mariana could be an important step toward the improvement of cross-border and cross-currency payments. Confident in the strength of our cooperation with MAS, we hope that other joint experiments will follow the Mariana project. There is still a lot to be done, especially on more complex financial activities around the lifecycle of financial securities in a cross-border and cross-currency context. In conclusion, I would like to say that financial innovation is promising and exciting but can be for an institution like the Bnaque de France, which has among its core mandates to ensure financial stability, a source of issues if not concerns. It is therefore for us in any case very stimulating and leads us to reconsider and adapt our role, our policies and our services. To that end, with the help of our team in Singapore and the new leadership of Stéphane Latouche, I very much hope that we will be able to continue  3/4  BIS - Central bankers' speeches  working with you here in Singapour, and in particular with the MAS, to better master innovation and build the future of our financial system. Thank you all for your attention. 4/4  BIS - Central bankers' speeches
As conservative central banks, our involvement in the forex markets is limited to strategic investments and stabilising the exchange rate. Following this role, the Central Bank of Sri Lanka does not get involved in speculative type of trading. However, it plays a major role in the development of the country’s forex as well as other financial markets. We know that in a market-oriented economy, all financial market segments, namely, the foreign exchange market, money market, government debt securities market and the stock market are inter-linked. The Central Bank, while watching the operations of each market segment individually, needs to take a macro view of all the market segments to ensure financial market stability. The focus today, however, should be on the foreign exchange market. In the exchange rate area, it is appropriate to mention at this juncture, Sri Lankan authorities made a fundamental change to its policy on 23rd January, 2001 by moving to a freely floating exchange rate arrangement. This was necessitated by the inability of the then prevailing exchange rate system and the crawling band regime to sustain themselves. Immediately after the float, the market experienced some volatility as is usually expected. However, this volatility has been contained overall since then. This, not only brought confidence to the market, as evidenced by increased foreign exchange inflows, but also allowed greater flexibility and market opportunities to foreign exchange dealers of commercial banks.

The more certain assessments are about future interest rate developments, the lower risk premiums that investors will require to purchase short-term, interest-bearing treasury paper, for instance, or the banks to lend money to businesses and households. Great uncertainty leads to macroeconomic costs such as lower investments and higher costs for central government debt. There is therefore a wish not only on the part of the participants in the financial market but also from the Riksbank to be as clear as possible about the factors underlying monetary policy decisions. However, absolutely most important is to make the inflation target credible since that controls the long-term interest rates. However, it is important to be as clear as possible about the conduct of monetary policy in the short term to avoid unnecessary uncertainty. But this does not mean that we can remove the uncertainty that actually exists about future developments. We continuously evaluate our previous assessments when new information and statistics are received. And we continuously develop our methods and models and may, when we have received new information, be obliged to re-evaluate earlier conclusions. This was the case, for instance, in the spring when we revised our assessments about the output gap. The conclusion of that is that the interest rate path cannot be announced in advance and even less that we can undertake to supply the interest rate decisions that the market participants sometimes consider that we have given indications of.
Debt levels and developments in housing prices are taken into account in the Riksbank’s forecast of future inflation through their effects on household wealth and thereby on demand in the economy. It is difficult of course to predict how households will act, but we usually assume that they are rational and able to make sound judgements of how the economy will develop and how this will affect their borrowing costs. This is not necessarily a correct assumption. For example, it’s conceivable that households in certain situations would react stronger to a rate hike than to an equivalent rate cut. Should households not expect interest rates to rise in an economic upturn and a rate hike by the Riksbank came as something of a surprise, it could have effects on consumption beyond those predicted in our models. We discuss these effects and try to take account of them outside our models to the extent that we believe it is justified. Were households to react stronger than expected, it could mean that we don’t need to raise interest rates as quickly in an economic upswing as we otherwise would have done. BIS Review 67/2004  3  The question of the real economic effects beyond the forecast horizon is trickier. When a speculative bubble bursts, it can result in rapid price falls, but also in poorer economic growth and higher unemployment in the longer-term. Naturally, this is something we want to avoid if possible.

A hike in interest rates would directly affect households’ purchasing power, especially given that households are increasingly taking variable-rate loans. A drop in house prices would also reduce their wealth. So, should interest rates rise and housing prices fall, it would have a bigger impact than before on households’ purchasing power, and thereby probably on consumption and saving as well. This brings me to the connection to price stability. Now and again we hear concerns in the public domain about the effects that households’ higher sensitivity to interest rates and asset prices could have on future consumption and thereby on economic developments in general. Several voices have called for monetary policy to be more attuned to this. Shouldn’t interest rates be raised to curtail a build-up of debt and a rise in housing prices? Should housing prices fall rapidly, might not demand and thus inflation be affected in a way that is not taken account of in the Riksbank’s forecasts? And, looking somewhat further ahead, might it not have a real economic impact that the Riksbank would also have reason to take into consideration? These highly legitimate questions are often based on concerns that some kind of speculative bubble has been blown up, in much the same way as in the commercial property market in the early 1990s or in the equity market ten years later. Let me first address the question of the forecasts.
Matters such as the privacy of personal information, security, the risk of cyberattacks or even the risk of exclusion, must 6/8  be monitored and, where appropriate, duly regulated. Regulation has to achieve a balance, protecting financial stability and confidence in the system, without unjustifiably hindering the exploitation of these technological innovations by industry and society in general. It is still too soon to gauge the impact of the technological revolution on the traditional banking sector. I believe that technological innovations will complement traditional banking activities, but to achieve this banks must be sufficiently flexible and dynamic to reap the benefits of technological innovation. There is no question that innovation is also favouring the proliferation of new fintech firms, of highly varying profiles and business models, which may conceivably compete with traditional banks in a specific part of the banking value chain, but are more likely to engage in new ancillary services. One example is joint financing through online platforms, known as “crowdfunding”. It is an alternative source of financing which may offer certain improvements over traditional banking in terms of convenience, speed and cost. But risks have also been identified, such as a potential increase in fraud or greater weaknesses in terms of investor confidence. There is a well-known case of a Swedish P2P platform which went bankrupt late last year after the detection of malpractices in credit extension, prompting a fall in the activity of the sector and closer regulatory attention.

Ladies and gentlemen, let me end my remarks by quoting a line from the book: “Risk of crisis as financial integration increases will never disappear, and countries must pursue protection from risks of volatility and sudden stops”2. We should always be vigilant, even in peace time. To Mr Kawai and other authors, congratulations yet again on the launch of this new and important book. 15. 2  Thank you. Chapter 4: “Managing large capital inflows: taking stock of international experiences” (by Susan Schadler). BIS central bankers’ speeches  3