samchain/econo-pairs-v1 huggingface dataset:
Lucas Papademos: Economic performance, institutions, and human values Speech by Mr Lucas Papademos, Vice-President of the European Central Bank, at the Second International Symposium on Universal Values: “Science, Technology and Human Values”, The Academy of Athens, Athens, 2 May 2007. * I. *  *  Introduction  This conference focuses on a fundamental and broad topic of relevance to all fields of science and public policy: the importance of human values. The role of human values in shaping developments in different fields of science, in assessing the implications of scientific advances and in adopting appropriate policies is steadily becoming more widely recognised and better understood. This observation is also true for economic science and public policy. Over the past half-century, economic science – both theoretical analysis and empirical research – underwent a profound transformation with the progressive and extensive adoption of mathematical analysis, statistical methodology and use of computing technology. The “dismal science” has become more of a true science. However, the vast majority of the significant advances in economic theory and empirical analysis has placed little emphasis on the role of values as well as institutions in influencing the behaviour of economic agents, the overall functioning of the economy and the orientation or conduct of economic policy. This fact may seem rather odd since in previous years the importance of institutions and underlying values was at the centre of economic and political thought.

However, we should go one step further and look at the social values and preferences that influence the behaviour of economic agents who interact with, and are affected by, the economic institutions referred to earlier. After all, the various reforms envisaged in the Lisbon agenda will fail to produce tangible results if they run counter to what many Europeans perceive to be quintessentially European values, preferences and attitudes. As outlined in the simple conceptual framework introduced earlier, economic performance and the functioning of markets can be directly influenced by values and deeply held beliefs – such as self-realisation, fulfilment in life and other post-materialist values; the relative importance of work, achievement and success; freedom, competition and cooperation; tradition and religion; family and community; safety and protection, etc. A number of economists have argued that lower labour force participation rates and shorter working hours in Europe relative to the US may reflect a preference on the part of Europeans for more leisure time over additional income.4 In other words, that Europeans seem to place more value on extra leisure than having a few extra euros in their pockets, while Protestant work ethics and a more materialistic attitude to life drive Americans to work harder.
Our robust regulatory infrastructure, sound Shariah governance framework, wide international connectivity, diversified players and products, elevated by the Malaysia International Islamic Financial Centre (MIFC) agenda, provides a conducive landscape for the Islamic financial industry to tap into emerging opportunities in these areas of focus. To underpin this is the development of a vibrant Islamic Financial Market. As part of Financial Market Committee’s (FMC) effort to further develop the onshore financial markets, we have established two subcommittees: the Bond Market Subcommittee and the Islamic Financial Market Subcommittee to formulate specific market development initiatives to take us forward. The creation of these subcommittees underlines the importance of both of these markets in the context of overall development of the domestic financial markets. The Islamic Financial Market Subcommittee will review the current landscape to identify and address challenges to the continued growth and development of the Islamic financial market, particularly in light of the growing importance of Malaysia's Islamic Banking sector as well as the significance of Malaysia's Islamic capital market, both domestically and globally. Domestic Islamic banks account for about 42.5% of the overall commercial banking loan book and could reach 45% by the end of 2026[1]. In the Sukuk segment, Malaysia has maintained its leadership position in the global sukuk market in 2021 by commanding a market share of 37% of the global sukuk outstanding[2]. The industry has already developed an encouraging track record in the sustainable finance space, as evident from the sovereign and corporate sustainability sukuk issuances to finance green and social-related projects.

It is not easy, therefore, to reconcile the revised earnings data with other information on the labour market. And these data really matter for the MPC’s assessment of the UK economy. I can promise you that the Bank, the Treasury and the Office for National Statistics will, as a matter of urgency, be working together to try to understand what is happening to earnings. Decisions on interest rates must take into account not only those factors which I have highlighted this morning - the international economy, the possibility of a credit crunch and uncertainty about the trend in earnings growth - but also a wide range of other information relevant to the outlook for inflation, including the behaviour of the monetary aggregates, which are still growing quite rapidly, and the fall in sterling’s effective exchange rate. Over the next two weeks more important data will become available, including the first estimate of GDP growth in the third quarter, a CBI Industrial Trends Survey and the monthly report from our regional Agents. At our next meeting on 4 and 5 November, the MPC will take into account all of this information, and occasions like today are part of the process by which we obtain more information and exchange views with those most directly affected by our decisions. BIS Review 86/1998
As cumulative inflation during the first half of 2009 has been historically low at 1.83 percent, it is estimated that inflation will rise in the first half of 2010 due to base effects (Figure 26). As the impact of adjustments in taxes and administered prices made for the sake of budget balance will ease, we forecast that inflation will display a downward trend starting from the second half of 2010 and stabilize slightly below the end2011 target of 5.5 percent. It is critical to note that inflation would be less persistent and thus  BIS Review 103/2009  17  the economic recovery would be smoother if economic agents adopt these forecasts as a benchmark in their pricing decisions. I would like to underline that any new data or information regarding the inflation outlook may lead to a change in the monetary policy stance. Therefore, assumptions on future policy rates underlying the inflation forecast should not be perceived as a commitment on behalf of the CBRT. Risks Distinguished Members of the Press, In the last part of my presentation, I would like to mention the risks with respect to the inflation outlook in the upcoming period and give some information pertaining to the probable monetary policy strategy should these risks materialize. As I have mentioned earlier in my speech, despite having partially receded, the risks regarding the global economy are still important for the inflation and monetary policy outlook. In particular, ongoing problems in credit and labor markets pose downside risks on global activity.

Pharmaceutical companies and merchanting For some time now, the Swiss current account surplus has primarily been driven by two industries: pharmaceuticals and merchanting. 8 It is notable that net exports for these two industries have increased strongly over the last ten years despite the appreciation of the Swiss franc. This stands in contrast to many industries (e.g. machinery and tourism), which are exchange rate-sensitive and have suffered noticeably as a result of the strong franc. The decline in net exports for these industries has been largely offset by the positive developments in pharmaceuticals and merchanting. Chart 7 presents the nominal change in net exports in selected manufacturing and services industries as well as merchanting from 2007 to 2016. The net exports of goods and of services are represented by the red bars at the bottom of the chart. Net exports of goods went up by CHF 23 billion from 2007 to 2016. As already stated, this increase can mainly be attributed to pharmaceuticals and merchanting. Despite the strong appreciation of the Swiss franc, net exports in both of these industries rose sharply during this period. Why is this? In recent years, the pharmaceutical industry has profited from a growing demand for healthcare products from all over the world. The demand for these products is only slightly impacted by the price and/or exchange rate. At the same time, Switzerland has developed into a leading hub in the global commodities trade. Merchanting is also much more dependent on global economic trends than on the exchange rate.
Honed by international benchmarks, best practices and the scrutiny of a global audience, Central Banks are institutions that over the years, have built a strong reputation for intellectual rigour, credibility and independence. Given this, Central Banks are often called upon to be the institution that drives important and often challenging financial reforms in an economy. Additionally, in most emerging economies, the largest concentration of talent resides in the Central Bank, providing it with the resources and intellectual capacity to undertake multifaceted developmental roles that extend beyond our core mandates. The fact that Central Banks are often a highly-regarded public institution in a country also lends it to having greater legitimacy in addressing challenging domestic issues. In managing this role effectively, three elements are key: clarity of the outcomes to be achieved, a governance process which gives clarity on the decision making process and accountability, and finally, ensuring the integrity and the independence of the Central Bank is not undermined. Another recent important element of Central Banking in the emerging economies that contributes to the effectiveness of the Central Banks in policy making is the close collaboration amongst Central Banks in the emerging economies – in particular in the Asian region. The formation of formal regional platforms for collaborative initiative facilitates the sharing of information, experience and knowledge which are crucial in driving the national, regional and even international agenda.

But it is something that needs to be done now if we are to prepare the ground for our future generations. It is from the legendary Dr. Puey whom we can draw significant inspiration. Dr. Puey had long recognised the importance of institutions to economic development and dedicated a major part of his life to this endeavour. He was a true leader, whose contribution to his country’s economic progress extended beyond the Central Banking sphere to several other areas of public service, to education, and to beyond the national borders of Thailand. We are now the beneficiaries of Dr. Puey’s efforts which laid the foundation for the greater Central Bank cooperation that we see in the region today. Dr. Puey was a true visionary. He had consistently demonstrated his vision, dedication and foresight and in the process, created highly regarded institutions not only in Thailand but also for the region. The subject of institutional building has generally referred to institutions that support the functioning of markets. It is maintained that markets allow for the more efficient use of skills and resources to engage in activities with higher productivity. As stated by Douglass North, known for his work on institutional economics, institutions comprise a set of formal rules that provides the framework for interaction and which shapes the incentives for the functioning of the economy. These include the incentives for people to invest in more efficient technology, to increase their skills and to organise efficient markets.
The conclusion of the discussion on risks in the Inflation Report, and which I have only briefly touched on here, is that we saw reason to make an upward adjustment in the main scenario inflation forecast of around a tenth of a percentage point. This does not alter the conclusion that inflation in terms of both CPI and UND1X will be below the target level during the coming two years. During the first year we believe that inflation will be significantly below two per cent. We have also assessed that inflation will be marginally below the target at the end of the two-year period. This is the background to the decision we made yesterday to cut the repo rate by 0.5 percentage points. BIS Review 20/2004  3  Inflation in line with target in 2003 That covers the discussion in the Inflation Report and our interest rate decision. Let me now move on to discuss monetary policy from a retrospective view. We have as usual in connection with the publication of the first Inflation Report of the year produced a background report to facilitate the assessment of monetary policy over the past three years. This report is included in a special box in the report. Measured as an annual average, the inflation rate was very close to the 2 per cent target in 2003. The CPI increased by exactly 2 per cent, while UND1X inflation, which is adjusted for the direct effects of indirect taxes and interest rates, amounted to 2.3 percent.

We wish to support your efforts to enhance the adequacy of capital in a manner that conforms with your institutions’ risk profiles, strengthens the management of risk, and fortifies the stability of your financial systems. Concluding thoughts on the New Accord Clearly, all of us have come a long way since 1988, regardless of whether we were the first or simply the most recent supervisors to adopt the original Accord. As we develop new approaches to capital adequacy, none of the milestones we’ve achieved, and none of our success in resolving open issues, would have been possible without the dedication that you, the members of the global supervisory community, have demonstrated. You have been enormously supportive of our work and have undertaken considerable pains to share your views and ideas. The members of the Committee and I are particularly grateful to our friends and colleagues in the rest of the supervisory community for your advice and counsel. We know that none of us will be able to claim individually the success of the New Accord as our own. Instead, it is dependent on all of us to work hard and promote the virtues and benefits of the New Accord in our own countries. Press releases and some encouraging words from supervisors will not suffice. Success will demand our mutual and dogged determination to encourage our banks, to prepare our staff, and to cooperate with each other.
The arguments against a possible Swedish membership of the EMU have often touched on the opportunity to pursue an independent stabilisation policy. The starting point for this is that the Swedish economy could for one reason or another find itself out of synch with economic developments in the eurozone, what is known as an asymmetrical shock. Having an independent monetary policy and currency would then give us the opportunity to stabilise our economy ourselves - act as a form of shock-absorber, which we will lose if we have a joint monetary policy governed by the prospects for inflation and the business climate throughout the eurozone. This was also the primary reason why the Calmfors Commission's report on the consequences of 1 Swedish membership in the EMU came to the conclusion that Sweden should wait until its labour market and wage formation showed sufficient flexibility to deal with a serious disturbance. However, it should be noted that the Commission was envisaging a “small” eurozone with around 6 countries taking part, whereas now we are talking about 12 countries, representing 40-50 per cent of Sweden's trade. Moreover, in practice the Swedish business climate has rarely come seriously out of synch with the eurozone. When Sweden has done so, it has mainly been the result of mistakes in Sweden's own economic policy and not due to any unforeseeable external disturbance that has afflicted the Swedish economy.

In my opinion, these are problems that are worth a closer examination. It is on these issues that I intend to speak today. The role of the Riksbank The role of the Riksbank in this context is to implement the decision taken by the government and parliament. The Sveriges Riksbank Act, which has governed our operations since 1999, states that “the Riksbank shall decide on the application of the foreign exchange rate system decided upon by the government.” The General Council of the Riksbank last expressed an opinion on the issue in 1997 when asked to respond to the government's investigative report. In its response to the submission the General Council emphasised that the economic advantages of a membership probably outweighed the disadvantages and that Sweden therefore should join the EMU from the start. The current Executive Board has not had reason to take a stance on the issue. Over the past few years we have regularly made technical preparations to enable a possible future membership to be implemented at no great cost and in a problem-free manner if and when a decision is finally taken. Economic consequences of a Swedish EMU membership The most obvious advantage with the disappearance of the currency borders is that which is normally known as transaction gains. This is the removal of the cost and inconvenience involved in exchanging currency when one visits or trades with different countries in the eurozone.
As we don’t have a crystal ball, we can only wait and see what will happen in the re-pricing of assets across the globe as and when interest rates begin to normalise. In the meantime, it is crucial we are well-prepared for possible turbulence and shockwaves. BIS central bankers’ speeches  5  17. But, I believe Hong Kong is on the right track. While we have been at the receiving end of massive international capital flows for several years, prompting a rise in inflationary pressure and overheating in the property market, we have acted swiftly to contain the adverse impact of such unprecedented monetary easing policies. Since 2009, the HKMA has undertaken six rounds of countercyclical prudential measures on mortgage lending, coupled with other supervisory action on bank capital and liquidity, to enhance the resilience of the banking system so it is better equipped to cope with future shocks. We have also launched a series of measures to contain credit growth, and recently we have further required banks with relatively fast credit growth to ensure they have stable funding sources to support that growth. 18. The prospect of a tapering in quantitative easing in the US has already caused jitters on global financial markets, including fund flows and exchange rates in some regional economies. Such volatility may continue, if not magnify, in the next couple of years. Therefore, we must remain vigilant against the possible spillover effects from other economies, as well as any other emerging risks.

Eddie Yue: How Hong Kong is prepared for macro-economic challenges on the horizon in 2019 Opening remarks by Mr Eddie Yue, Deputy Chief Executive of the Hong Kong Monetary Authority, at the Hong Kong-Paris Financial Seminar, co-organised by the Hong Kong Monetary Authority and Paris Europlace, Hong Kong, 16 January 2019. * * * Denis (Beau), Arnaud (de Bresson), distinguished guests, ladies and gentlemen, 1. Good morning. Let me extend a very warm welcome to you all for attending today’s Hong Kong-Paris Financial Seminar, co-organised by the HKMA and Paris EUROPLACE. And a special welcome to our guests from France. 2. Hong Kong and France have always had strong ties. We are home to more than 20,000 French people and about 800 French companies. Apart from food and beverage and luxury goods that people are familiar with, French companies are also actively engaging in different industries in Hong Kong, ranging from finance, construction and infrastructure. About 170 of the French companies use Hong Kong as the regional headquarters. Given the existing strong ties, it is particularly good to have forums like today’s seminar to talk about how Hong Kong and France can further strengthen their relationship through financial collaboration. 3. Before I talk about the opportunities for further collaboration, let me spend a few minutes to talk about the risks and the rather challenging macro environment that we are facing.
The actual form inflation targeting took in Romania thus matched the “managedfloating plus” concept introduced by Goldstein in 2002, considered the most suitable choice for an emerging-market economy involved in the global capital market, as it combines the managed float part, allowing for FX market interventions in order to smooth out excessive volatility, with an inflation targeting monetary policy strategy and an active pursuit of measures to limit the degree of currency mismatches in the economy. What are the challenges of adding explicit concern about financial stability to the standard objective of price stability? Should monetary policy lean against the wind sooner and possibly harder than it would normally? Even though now, with the benefit of hindsight, one could say that higher interest rates in the run-up to the crisis may have alleviated some of the issues that led to it, I believe that it is best to let monetary policy focus on price stability and deal with the objective of financial stability via dedicated macroprudential policy instruments – doing otherwise is likely to severely complicate communication with the public, complicating expectations management and ultimately undermining monetary policy credibility and effectiveness. It is indeed of critical importance to make sure that the tasks entrusted to the central bank are feasible. Not as clear-cut or simple as before the global crisis, but feasible! Otherwise, if the monetary authorities are overburdened with possibly conflicting goals, the major risk is to render them inefficient and unable to deliver a single one of their objectives.

I believe that we should try to learn as much as possible from the past mistakes. And I refer here not only to the recent past! The lessons of the last 7 years, while important, should not make us forget the lessons of the last 50 years, among which, to name but three, are the following: –  Accommodating other objectives should not put in danger price stability on the medium-run;  –  Inflation expectations cannot be ignored;  –  The independence of central banks is connected with their performance in delivering price stability. Irrespective of how we see now the future of our profession and institutions, it is apparent that the central bankers cannot afford to live in an ivory tower. They have to stay openminded and to keep close contact with the shifting economic and financial reality in order to be able to articulate and implement efficient policies. And if you still want me to foretell the future, I will end my speech by making a prophecy: what a central bank can or cannot do will remain a topic of heated debate for many decades. References Cœuré, B., “Independence and Interdependence in a Monetary Union”, Lamfalussy Lecture Conference organised by Magyar Nemzeti Bank in Budapest, 2 February, 2015. Crockett, A., “International Standard Setting in Financial Supervision”, Lecture at the Cass Business School, City University, London, February 5, 2003. Goodhart, C., “The Changing Role of Central Banks”, BIS Working Papers No 326, 2010.