samchain/econo-pairs-v1 huggingface dataset:
There are countries where a large proportion of borrowing is arranged at a variable interest rate; the national tax systems differ, for example as regards tax relief for interest expenditure; and the time required for bank interest rate adjustments varies. All this means that the impact of a change in the monetary union’s interest rate will differ from country to country. In Italy, for instance, lending to households is arranged at variable interest rates to a greater extent than in Germany and the Netherlands. EMU will probably speed up the ongoing integration in these respects, too, so the ECB’s problems may be greatest initially. Many matters to do with the ECB’s working procedures have already been decided. The broad structure is in place. But in many respects, the way in which the ECB and the ESCB will operate and develop in practice is still an open question. Some observers are concerned that national interests will be excessively influential at the expense of a union-wide perspective. They point out, for example, that the NCB Governors make up a larger proportion of the Governing Council than is the case with the regional FED Governors in the United States. Another argument is that the ECB has a limited staff at its disposal. Personally, I do not find this particularly convincing.

9  For sterling markets, see https://www.bankofengland.co.uk/markets/transition-to-sterling-risk-free-rates-from-libor https://www.isda.org/protocol/isda-2020-ibor-fallbacks-protocol/  10  4  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  4  3. Reducing the legacy of post-2021 LIBOR-linked contracts  Sadly it’s not only in derivatives where pre-existing fallback arrangements have been absent. Until recently, few contracts in other markets envisaged the potential for a world without LIBOR either, leaving borrowers and lenders alike exposed to serious uncertainty and the risk of a disorderly outcome. Where those contracts are expected to remain outstanding, the best chance of avoiding those risks lies in active conversion to another rate before the end of 2021. For sterling, the industry-led Working Group has strongly encouraged all market participants to complete, by the end of next March, a full assessment of their LIBOR contracts extending beyond the end of 2021. The aim is to identify those that can be actively converted, and to put plans in place to complete those conversions wherever viable by the end of next September. This advice is echoed more broadly by the FSB in its global transition roadmap. 11 If you haven’t done so already, you should be making a start on that assessment. To stand a chance of controlling your destiny, you need to know what your exposures are, and how you’re going to deal with them over the course of next year. Make and resource those plans now – we don’t want anyone to be caught out. And the regulators will be watching closely.
If wage growth in the general government sector is 1 percentage point higher than assumed, labour costs will increase  by a little more than NOK 2 billion. This is the equivalent of the entire increase in the use of petroleum revenues over the central government budget for 2003. The bulk of the high growth in central government allocations translates into strong growth in household consumption, while growth in public services production is moderate. This is only to be expected when there is a steep increase in public sector allocations in an economy where there are no available resources. The high level of wage growth is thus having a negative impact on both the internationally exposed sector and the more sheltered sectors of the economy. Public sector budgets are being consumed by wage growth, and growth in service production is being stifled. Teachers are being made redundant. The internationally exposed sector is feeling the double impact of high wage growth and a strong krone. Norges Bank has one instrument, the key rate, which has effects on the wider economy. This means that monetary policy cannot be oriented towards stabilising developments only in the internationally exposed sector. This would cause considerable imbalances in the Norwegian economy. It is important to be aware that low wage growth will be of double benefit to the exposed business sector.

Demand for labour, measured in terms of advertised vacancies, is also low in other industries, indicating that unemployment may also increase further in the sheltered sector in the period ahead. Registered unemployment is projected to increase from 3¼ per cent in 2002 to 4 per cent in 2003 and up to 4¼ per cent in 2004. Unemployment is projected to stabilise at this level in 2005. There are wide regional variations in unemployment. At the end of February, the number of registered unemployed in Troms County came to 3.6 per cent of the labour force, which is lower than the national average of 3.9 per cent. Agriculture and fisheries combined account for a larger share of employment in Troms County than in other counties. The internationally exposed sector is relatively small in the county. The food industry accounts for about half of manufacturing employment. As in the rest of the country, the public sector and some private service segments are important for employment in Troms. Business and financial services account for a smaller share than the national average. The work on the Inflation Report drew on information from the regional network that was established last year. We will have six rounds of talks each year with business and community representatives concerning financial developments in their enterprises and industries. There will be a total of about 200 visits in each round. We have divided the country into 7 regions and established links with regional research institutions in six of them.
Before dealing with the evidence of possible links between global liquidity, international portfolio flows and euro area monetary growth, it is worthwhile recalling the theoretical work by James Tobin and Harry Markowitz on macroeconomics and asset pricing. The bulk of Tobin’s work in the 1950s and 1960s was on the monetary side of macroeconomics. One of his main objectives was to establish a firm foundation for the sensitivity of money demand, or money velocity, to interest rates. He argued that people may prefer liquidity, and prefer it more the lower the interest rate on non-cash assets, because individuals are risk adverse. Over the same period, Harry Markowitz worked on portfolio choice problems, balancing risks against expected returns. Markowitz showed that under certain given conditions, an investor’s portfolio choice can be reduced to balancing two dimensions, i.e. the expected return on the portfolio and its variance. When the Nobel Prize was announced in 1981, Tobin was asked about his work at the press conference. He tried to explain for a lay audience the idea of why it is that people hold different proportions of different assets in their portfolios. 2  BIS Review 149/2007  He said, “Well, you know, diversification – don’t put all your eggs in one basket”. This explanation led to headlines around the world: “Yale Economist Receives Nobel Prize for ‘Don’t Put All Your Eggs in One Basket’”. A similar argument was made when the Nobel Prize was awarded to Markowitz in 1990.

The growing size of international capital flows associated with globalisation of financial markets has made the analysis of monetary aggregates, for the purpose of extracting information for assessing price stability, increasingly more complex. BIS Review 149/2007  3  This brings me to discuss the third point: the implications of globalisation and of international capital flows for monetary policy. If globalisation and, specifically, cross-border capital flows can affect the dynamics of monetary aggregates, how can we conduct monetary policy? An improved shared understanding of the influence of global liquidity and cross-border capital flows on the monetary policy transmission mechanism is necessary to enhance the analysis underlying our decisions. Our role and responsibilities as central bankers remain intact in the globalised economy, but the performance of our task may be becoming more challenging. Certainly, there is a need for timely and open exchange of information among central banks and for further collaborative research efforts. Still, let me stress that the globalisation of financial markets does not affect the central role and overriding responsibility of central banks, which is to preserve price stability within their respective jurisdictions. Central banks throughout the world have been assigned responsibility for keeping domestic inflation at low and stable rates. Cross-border capital flows may affect the velocity of money, but the basic principle for anchoring monetary policy – that is the Friedman’s view that “…in the long run, inflation is always and everywhere a monetary phenomenon” – remains valid.
For anyone familiar with Carmen’s work, this does not come as a surprise. Besides being an outstanding economist, Carmen is also an excellent writer. She writes on apparently dry economic topics in a captivating and entertaining way. It is fair to say that this is not the norm in our profession. Carmen’s research in economic history involves spending countless hours in libraries, consulting obscure sources – some of them centuries old – in the search for economic data. Carmen has compared her endeavours in finding and analysing data both to archaeological expeditions as well as to the detective work of Sherlock Holmes. While this sounds rather exciting, the process can be painstaking. Carmen once described an episode where she found herself, at 3 o’clock in the morning, counting the number of zeros in records from countries that had experienced hyperinflation. Of course, with such a tiring task a little help can come in handy. If the legend is true, Carmen’s husband and frequent co-author, our friend Vincent Reinhart, once put together almost all the economic data published by the League of Nations and gave it to Carmen on Valentine’s Day. Maybe Carmen can tell us a little bit more about this most unusual gift. Now back to Carmen’s economic research. Carmen’s specialty is to draw lessons for the present by studying the past. Taking a long-term view helps to put things into perspective, and reveals that there are often historical analogies to contemporary situations that may at first seem unprecedented.

In fact, it has to be recognised that around the world domestic authorities have been putting in place defensive measures, mostly below the radar of commentators, over the past few years. This comes back to the use of public money. A world in which public money is used to bail out banks or dealers, is a world in which balkanisation is likely because the authorities that deploy public money are accountable to domestic tax payers – people with votes in their jurisdiction – and to nobody else. But by delivering the FSB’s global agenda – not only on resolution, but more widely – we will significantly reduce, if not remove, the need for some of those balkanising tendencies. By making finance safe and orderly failure possible, I think we can take off the stage the most basic force towards balkanisation. The stakes are high. BIS central bankers’ speeches  5
As for the short-termism of the shareholders and the financial reporting cycle, banks are at the receiving end and there is not much they can do. 12. While I agree that it is probably unrealistic to go back to the “good old days” of banking, I am not fully convinced that there is little banks can do to restore a stronger alignment of interest with their customers. But that doesn’t really matter because, without these changes, the slow track solution to get rid of supervisors also does not seem to work! So I am bringing you the bad news! The bad news is that the public will need an agency entrusted with the mandate and powers to protect the safety of their deposits, to guard against banks taking excessive risk in pursuit of profits, to ensure that customers are treated fairly, to deal with 3/5  BIS central bankers' speeches  bank failure, as and when it happens, in an orderly manner to avoid disrupting the financial system and reduce the risk of having to use public funds again to bail out failing banks. What happened during the GFC is a very powerful reminder that excessive risk taking in pursuit of short term profits in modern day banking and finance can and did pose a serious threat to the economic well-being and stability of society as a whole, even in the most advanced economies.

Both the US and the UK Acts were prompted by preceding banking crises. In Hong Kong, the Office of the Commissioner of Banking was only established around 50 years ago in the 1960s, after a couple of rather unpleasant bank failures. Before then, banking was basically a free for all, although it did not mean that it was a wild jungle ruled by Tarzan or the Lion King. Back in those “good old days” during which banking supervision was not a prominent feature of our financial system, bank customers and depositors had to take care of their own interests by choosing very carefully who they could trust and bank with. It should also be borne in mind that internationally, the first Basel Capital Accord was only approved by the G10 Governors in 1988, meaning that we are only just approaching the 30th anniversary of this important milestone. 6. I know that you are going to say: you cannot find such a clock or time machine. In that case, the fast track solution is not quite available. So you will have to consider the slow track solution in trying to get rid of the bank supervisors. As I said earlier, a world in which there were no banking supervisors was not a wild jungle. For a long long time and well 1/5  BIS central bankers' speeches  before we had bank supervisors, bankers needed to earn the trust of depositors and customers in order to survive and thrive.
In practice, as the MPC has emphasised, the actual path of interest rates in the event of either Brexit outcome would never be automatic; it will depend on the response of demand, supply and the exchange rate to these outcomes. This is impossible to predict in advance. If a “no deal” were to lead to a sharp fall in sterling and a sharp rise in inflation expectations, it is not clear the MPC could cut interest rates, as the market expects, if it was to meet its inflation mandate. The risks to rates in a “no deal” scenario are in that sense two-sided, if not necessarily symmetric. This bi-polarity in possible economic outcomes poses a dilemma for UK monetary policy. Monetary policymakers are often cast as one-club golfers. In the current conjuncture, the problem is more that the MPC does not know which of two quite different fairways it should be aiming at. Brexit uncertainty is not, by itself, a reason for leaving interest rates on hold, as the two tightenings in monetary policy by the MPC since the Brexit referendum demonstrate. Nonetheless, with the economic road ahead potentially forking, the case for holding rates until the road becomes clearer is strong. With Brexit uncertainty high, the global economy softening and other major central banks expected to loosen monetary policy, it is not difficult to see why short-term interest rates have fallen and are now pricing a nearterm loosening of UK monetary policy. UK growth is expected to stall in the second quarter.

Averagesize farms continue to be relatively small, thus restricting the development and growth of average productivity, or differently known as “the economies of scale”. There are many reasons behind this. We can mention the inheritance of the communist system and the separation of land after its collapse. As it was stated above, the lack of a normal land market also due to ownership problems, naturally plays an important role in establishing larger farms and, consequently, more competitive ones. These problems also affect the agricultural sector-bank relationship and the lending activity at home. The recent data show that lending to the agricultural sector accounts for 1.25% of total lending to businesses, on average. It is a considerably low figure, which should raise our concern, considering that this sector contributes by one/fifth to the gross domestic product. I believe that there are two reasons driving the banking system to be reluctant to finance different projects in this sector. First, risk classification and categorisation for credit to agricultural sector is a commitment different from the other activities. The lack of formalisation, even for matters such as regular maintenance of information and statistics  BIS central bankers’ speeches  3  about ownership, and financial statistics, damage the farmers’ credibility from the early steps of lending. I find that there is room for prudential intervention by public institutions, not to condemn farmers, but to better prepare them and assist them in formalising their business.
The chart also shows the price of imports and an indicator of underlying domestic inflation, UNDINHX. As you will see, we believed inflation would move up gradually in the wake of rising activity. This would be countered by low, even falling, import prices in connection with a stronger exchange rate, lower oil prices and generally strong global competition. Even our inflation forecast was evidently on the high side, at least to date. It is perhaps even more noteworthy that underlying domestic inflation has turned out to be appreciably lower. This is something that observers of the Swedish economy cannot ignore, particularly as the past decade has provided so many surprises of this sort, though not as dramatic. The main point to consider is, of course, how permanent the changes are likely to be. To what extent should we abandon earlier relationships and commit ourselves to a continuation of the relationships that have applied in recent years? 1  BIS Review 107/2000  Why has inflation been low? The first thing to note is that this development has not been confined to Sweden. Inflation in many other countries has also been unexpectedly low. There, too, the reasons for this are not entirely clear. Some pieces of the puzzle have been identified but not enough to make up a clear picture. As decision-makers, however, we cannot simply shrug our shoulders and say we don’t know.

Christine M Cumming: Enhancing payment system speed, efficiency and security Keynote remarks by Ms Christine M Cumming, First Vice President of the Federal Reserve Bank of New York, at the TCH Annual Payments Symposium and Business Meeting, New York City, 5 July 2013. *  *  *  It is a great pleasure to be here today to speak to you about the evolution of the U.S. payments system and the Federal Reserve Banks’ role in that evolution. The views I express will be mine and not those of the Federal Reserve System or the Federal Reserve Bank of New York, although I will draw on the considerable work being done in the Federal Reserve on the future payments direction. Without question, we are living in an once-in-a-lifetime period of change in the U.S. payments system. Payments providers are seeking ways to bring mobile technology to payments, an integration widely seen as a game-changer by payments industry participants. Person-to-person payments mechanisms have grown rapidly, and the potential for those funds to be immediately credited to the receiver could be another game-changer. Commerce increasingly integrates with a payments mechanism, especially as information about spending patterns are a source of value to firms and loyalty discounts and points become an important part of the business value proposition to customers. Indeed, rather than talk about a payments industry, we find ourselves talking about a payments ecosystem, a web of banks, service companies, alternative payments providers and commercial firms. Some have called these developments a second internet revolution.
Our trade negotiators are well aware of these principles and mechanisms and I am sure they will negotiate effectively. Now in addition to all the deals which that have been negotiated with India, China and Singapore, we have the bilateral FTA in goods with Pakistan which is being invigorated, and on top of that, of course we have EU GSP plus. If you take all this together, if we are able to conclude these Trade Negotiations successfully, Sri Lanka could have access, preferential access, to a market of 3 billion people, which is a massive USP. Now I think Singapore has  preferential access to both China and India. But they don’t have preferential access to EU. So there is no other country in the world that I know of, which has preferential access to China, India and Page 14 of 17  Europe. I know that GSP plus is only for four years. But four years is enough time for us to take advantage of it. So that is a massive opportunity. Now, of course this market of  three billion people is going to provide opportunities for our own exporters. But on top of that the trick is to use this preferential access  to  this  3  billion  person  market  to  leverage  the  trade/investment nexus. We can tell people you can come and locate here and sell on a preferential basis to China, India and Europe.

Sustained export growth is crucial for the development of Sri Lanka, particularly given the relatively small size of its domestic economy. Relying on the domestic economy is not sufficient to enhance growth. Sri Lanka was ahead of its regional peers in liberalizing its Page 4 of 17  economy in 1977. The adoption of liberal economic policies, such as private sector development, export networks and encouragement of FDI led to immediate improvements in the foreign trade openness of the country. Trade Openness which was 36.4% in 1977, nearly doubled to 72.2% by 1979 while exports which were 18.7% of GDP in 1977, increased significantly to 29.2% by 1979, just two years after opening of the economy. Despite the turn-around in the immediate aftermath of the adoption of liberal policies, Sri Lanka’s international trade performance has been lackluster since then, regressing to levels that were seen during the pre-liberalization era. In 2015, Sri Lanka’s Trade Openness was 36.5% - it was 36.4% in 1977. While exports,  relative to GDP, declined to 12.7% in 2015, having increased to 29.2% in 1979, and it rose as high as 32% in 2000. So we’ve gone backwards. And we have gone back to almost where we were in 1977, in terms of trade performance. Although the common notion is that there is a by-directional relationship between export and economic growth, this relationship has not been seen in relation to Sri Lanka.