samchain/econo-pairs-v1 huggingface dataset:
During the Global Financial Crisis and subsequent Eurozone crisis, macroeconomic shocks, financial market stresses, and institution-specific vulnerabilities interacted in complex ways with consequences for both systemic stability and the safety of individual institutions. The two-way flow of information and sharing of perspectives between the central banking and supervisory arms of MAS proved invaluable in helping us assess a rapidly evolving situation and co-ordinate appropriate policy responses in a timely manner. Having central banking and financial supervision within one organisation is not the only way to achieve better financial stability outcomes. It makes sense in a small country like Singapore. Larger jurisdictions have sought the same outcomes through strengthened coordination mechanisms among the various agencies whose work contributes to financial stability. The Financial Stability Oversight Council in the US and the Financial Policy Committee in the UK are two good examples. Third, being a financial regulator as well as promoter of financial sector development helps ensure that regulation is not only robust but sensitive to the broader needs of the economy. Lest there be any doubt, financial stability is our overriding objective. But a safe financial sector that does not help to meet the needs of businesses and individuals or support economic growth and development misses its purpose. Sound regulation is about promoting a robust yet vibrant financial sector that supports the wider needs of the economy. Our experience has been we can achieve better stability and development outcomes within one organisation with a shared purpose rather than separate agencies with possibly conflicting goals.

Ravi Menon: Smart regulation and sustainable insurance growth Speech by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the Insurance Institute of London, London, 12 May 2015. *  *  *  Mr Stephen Riley, President of the Insurance Institute of London Mr John Nelson, Chairman, Lloyd’s of London Ladies and gentlemen, good afternoon. I wish to thank John for inviting me to speak to you today. It is a privilege to address members of this esteemed Institute, and a pleasure to do so in a heritage building of such architectural and historic interest. I have been to this building before. And my first thought as Lloyd’s Building came into view, along with its plumbing, stairways and lift shafts, was transparency. So it is apt that in the same spirit of transparency, I should make a couple of disclosures: •  one, I am not an actuary or an accountant, and  •  two, I am not responsible for Solvency II. But John has kindly assured me that the musings of a central banker and regulator from the Far East counts towards fulfilling your continuing professional development requirements. So for my speech today, I will offer an overview of MAS’ roles as central bank and integrated supervisor, our approach to regulating and developing the financial sector, and prospects for the insurance industry in Asia.
Eddie charged me with the task of preparing ideas on how the new committee – the Monetary Policy Committee – would decide and set the level of interest rates, and to draft the speaking note for the very last Chancellor-Governor meeting which was brought forward from Wednesday to 8am on the Tuesday. By the next morning when the public announcement was made, a paper was ready setting out the questions that the Bank would have to answer on how the new Committee would operate. We had a script but, at this stage, the cast was incomplete. Only four of the five internal and none of the external  BIS Review 43/2007  1  members were in place. With the support and hard work of some extraordinarily talented young Bank economists, the new arrangements were designed and put in place in not much more than three weeks. They included the arrangements for briefing the Committee, the pre-MPC meetings, the format of the decision-making meetings of the MPC, practical matters such as the ordering of a sound system so that, in a break with tradition, it was actually possible to hear what was said in the Bank’s older meeting rooms, and rehearsals of the meetings and voting procedures with staff members playing the roles of the MPC members. So short was the time available that some of the dress rehearsals came after the first night of other parts of the policy process.

The trap is falsely to conclude that, because some economic models contain no explicit reference to it, money cannot be one of those signals. The conventional riposte is that, if monetary policy were set incorrectly, warning signals would also be observed contemporaneously in other indicators such as measures of inflation expectations, demand or interest rates. I would not want to rely on that for three reasons, which together imply that the growth of money and credit may signal in advance of other indicators that Bank Rate is set at a level inconsistent with bringing inflation back to the target in the medium term. First, we do not have good indicators of the expectations of businesses and employees and, in looking at measures of expectations in financial markets, we must be alert to the possibility that those expectations are formed by people falling into the same trap. Second, the spending of many households and businesses is constrained by the need to use money in transactions and by the availability of credit.14 For these households and businesses, changes in the availability of money and credit lead changes in their spending intentions. Thirdly, official interest rates are not a sufficient statistic for the array of effective interest rates confronting borrowers and lenders – risk premia which reflect the creditworthiness of the borrower  14  8  Goodhart (2007). BIS Review 43/2007  alter effective interest rates.
The financial unrest will probably also contribute to Swedish households maintain a certain level of precautionary saving. The fact that it costs more for banks to finance themselves may also contribute to households and companies sooner or later facing dearer loans. But there is considerable uncertainty over how extensive the effects of the financial unrest and the US housing market will finally be. We therefore analyse an alternative scenario with weaker international growth in our Monetary Policy Report. Prospects for inflation and interest rates We are expecting inflation to rise fairly sharply next year (slide 12). This is partly connected to energy prices rising more rapidly. But inflation is rising even adjusted for energy prices. And the reasons are primarily that utilisation of the economy’s resources and cost pressures have increased. Moreover, there are signs that food prices will increase rapidly over the coming year. Inflation measured in terms of CPI will amount to around 3 per cent in 2008, according to our forecast. The measures of underlying inflation, CPIX, which I recently mentioned, will in our opinion rise from the current level to around the target next year. The differences between the measures are largely due to households’ mortgage expenditure increasing and to higher indirect costs. When the economic cycle enters a calmer phase, the CPIX will fall back to levels around 2 per cent, while the CPI will remain slightly higher. This is our assessment, given that we raise the repo rate in the way I described earlier.

On that note, I would also like to take this opportunity to record my appreciation to all steering committee members and the panel of jury of the Royal Award for Islamic Finance 2016, led by Yang Amat Berbahagia Tun Musa Hitam for their unwavering support and commitment. Ampun Tuanku, Demikianlah sahaja sembah ucapan patik, dan sebelum mengundur diri, patik sekali lagi merakamkan ucapan menjunjung kasih, kepada Seri Paduka Baginda Tuanku di atas limpah perkenan berangkat ke majlis pada malam ini. 1 Thomson Reuters estimation, June 2016. 3/3  BIS central bankers' speeches
For another, Solvency II requires us to monitor the fitness and propriety of a broader range of staff than in banks. In coming months we will build on the provisions of legislation to produce a regime that in spirit is aligned with the standards to which we hold bankers, but that in practice is a tailored approach for insurers. It will combine accountability with efficiency. Ultimately, of course, social capital is not contractual; integrity can neither be bought nor regulated. Even with the best possible framework of codes, principles, compensation  20  As the CEO of TD Bank, Ed Clark, observed, “Bank leaders created cultures around a simple principle: if it’s legal and others are doing it, we should do it too if it makes money. It didn’t matter if it was the right thing to do for the customer, community or country.” See Clark (2012). BIS central bankers’ speeches  7  schemes and market discipline, financiers must constantly challenge themselves to the standards they uphold. A meaningful change in the culture of banking will require a true commitment from the industry. That is why a second initiative, the creation of the Banking Standards Review Council (BSRC), is particularly welcome. 21 This new independent body, again proposed by the Parliamentary Commission, is designed to create a sense of vocation in banking by promoting high standards of competence and behaviour across the UK industry.

Over this twoday period, we have lined up a panel of distinguished speakers, including the Honourable Prime Minister of Malaysia himself as well as Governor of Bank Negara Malaysia. The invited speakers are from various prestigious institutions, domestic and international with unique expertise and experiences. You can be rest assured that the speakers we are bringing to you are renowned in their own field and their views are well sought after by global investors and the financial fraternity. The major highlight of this conference is the keynote address by the Honourable Dato' Seri Abdullah bin Haji Ahmad Badawi, the Prime Minister of Malaysia who is also the Finance Minister. His address will offer invaluable insights into Malaysia's policy and strategies to sustain its strong growth performance. The next significant highlight of this conference is a speech by Tan Sri Dato' Seri Dr. Zeti Akhtar Aziz, the Governor of Bank Negara Malaysia, who will touch on investment opportunities in Malaysia in an evolving global environment. This speech is timely given so much interest shown by both domestic and international investors in the Malaysian economy. Both the Prime Minister and Governor will offer invaluable insights into strategic orientation of important policies that will chart the Malaysian economy going forward. Therefore, these are the main events not to be missed. Of course you should not miss other speakers too! They will touch on various topics according to their areas of expertise.
First, the issuance will be on a reverse enquiry basis, which means we will issue according to the needs of financial institutions in Singapore conducting Islamic Finance. Second, at the initial stage, we plan to price these against the liquid Singapore Government securities market. This will provide a transparent price discovery mechanism for this new instrument in Singapore. As the $ sukuk market grows and deepens in time, it can then develop its own pricing benchmarks. The design of our sukuk issuance facility reflects our effort to harness the price discovery potential of existing liquid instruments, while adhering carefully to Shariah principles. Further details of this arrangement will be announced in due course and we look forward to your feedback. We will also make significant progress in integrating financial markets when we provide greater market access for Islamic service providers to operate across borders. I am glad that regulators in the Middle East and South-East Asia have been very supportive in this area. For instance, several major Islamic banks in the Middle East now have operations in Malaysia. More recently, several Middle Eastern banks have also established themselves in Singapore. The first home-grown Islamic bank in Singapore, the Islamic Bank of Asia was set up in Singapore in 2007. The IBA is a joint venture between Singapore’s DBS Bank and Middle Eastern investors from Bahrain and the GCC countries. I am pleased that within one year of its existence, the bank will be opening a representative office in Bahrain next week.

Heng Swee Keat: Monetary Authority of Singapore’s initiative to develop Singapore dollar sovereign-rated sukuks Speech by Mr Heng Swee Keat, Managing Director of the Monetary Authority of Singapore, at the 5th Annual Islamic Financial Services Board Summit, Amman, Jordan, 13 May 2008. *  *  *  Introduction It is my honour this afternoon to join my IFSB colleagues in discussion of this very current topic. I am very glad that we are addressing this issue of regional integration of Islamic Financial Services at this point. This is very timely and relevant to both the soundness and vibrancy of Islamic Finance. Let me explain. The global Islamic finance industry has grown rapidly – it is estimated that total assets are now over $ billion. This is impressive. Still, this is a small proportion of conventional finance. The potential for growth is hence very large. While each country is taking measures to promote Islamic Finance, we can grow much faster as well as increase the scope and depth of the industry if we work towards integration at an early stage. Integration increases market size, efficiency and liquidity. This in turn provides for more competitive cost of capital, spurring further growth. Second, having service providers from different regions allow risks to be distributed across a wider group of players, and can improve the overall stability of the financial system. Regional integration between Middle East and Asia, which may have different business cycles, provides a cushion for financial institutions and investors from country specific shocks.
These asset purchases, together with the measures taken since June 2014, have proved very effective by activating a broad range of channels to support growth and inflation in the euro area. BIS central bankers’ speeches  1  First, they have contributed to a tangible, broad-based easing of market funding conditions, transmitting the stimulus to the euro area economy at large. 1 Second, through improving borrowing conditions for firms and households in the euro area, these measures have also promoted a recovery in lending that went back to positive growth in the second half of 2014, supporting expenditure on investment and consumption. 2 Without these measures, the euro area would have been in outright deflation last year and prices would have fallen at an even faster rate this year. Growth would have been significantly lower. 3 Towards the end of 2015, significant risks to the inflation outlook started to materialise. Headline inflation entered negative territory in September (–0.1%), slightly recovered in December (0.2%) and January 2016 (0.3%) before turning negative again in February (–0.2%). This was partly due to a substantial decline in crude oil prices by 48% in euro terms from May 2015 to January 2016. The decline in oil prices reflected continued oversupply, weakening oil demand and the OPEC countries not cutting production targets. In particular, around half of the decline in headline inflation from January to February reflects that the already negative annual energy inflation turned even more negative.

BIS central bankers’ speeches  1  There are two objectives: first, to review the principles and refine the criteria that guide the choice of historical characters for banknotes; and second, to establish a process to ensure that potential candidates are consistently and transparently judged against those criteria. The review will be led by Chris Salmon, the Bank’s Chief Cashier, who will be meeting with interested parties as well as inviting feedback from members of the public via our website. The conclusions will be announced by the end of the year. Now let me introduce a real expert to tell you a bit more about Jane Austen and her time at Chawton. Elizabeth Proudman is Chairman of the Jane Austen Society, and I would like to thank her, along with Ann Channon and staff here at Jane Austen’s House Museum, for hosting today’s event. Elizabeth, over to you. 2  BIS central bankers’ speeches
Nevertheless, interpretation of the quarterly estimates is difficult in view of the sizable fluctuations in final demand and the fact that the main factor impacting on GDP momentum are changes in inventories. Other indicators, such as the consumer confidence index, company expectations, labour demand and the continued low level of inflation expectations, appear to indicate a more modest level of economic momentum. Despite the uncertainty with respect to the GDP estimates, the information currently available to us indicates that economic recovery has accelerated over the past few months. Fourth-quarter indicators point to a continuation in the economic upswing. Although export growth is slowing, international demand remains robust. This momentum is increasingly shifting into the domestic sector, where it is acting as a stimulus. Gradually, the utilisation of industrial production capacities is improving. Meanwhile, companies expect demand to pick up over the next few months. There were signs of a recovery in corporate investment in the third quarter. Over the next few quarters, a high utilisation rate of technical capacity in industry and a more favourable sales outlook  BIS Review 86/2005  1  are likely to provide greater support for investments in equipment and a gradual increase in labour demand. As a result, the disequilibrium in the labour market is likely to diminish. In the last quarter, private consumption remained strong. Since employment can be expected to increase over the course of 2006, consumer confidence should strengthen. By contrast, the stimulus provided by construction investment is likely to subside next year.

The two forecasts are very similar for 2006, and show receding rates of inflation due to the fact that oil prices are not increasing any further. As of 2007, the new inflation forecast lies below the previous one. This reflects the dampening effect of today’s interest rate decision on future inflation. The forecast shows that there is no immediate inflation risk. At 0.8% and 1.2% in the coming two years, the expected rates of inflation remain low. However, it is evident from the inflation dynamics that, even with a three-month Libor of 1.0%, monetary policy has an expansionary effect. With today’s decision to increase the three-month Libor by 25 basis points, we are adhering to our previous monetary policy course. We continue to support the economy, using the leeway available to us. This should guarantee price stability in the longer term. If the Swiss franc appreciates rapidly, the National Bank will respond appropriately, and is keeping all its options open for such an eventuality, as it has in the past. Observed inflation December 2005  BIS Review 86/2005  3  Inflation forecast of September 2005 with Libor at 0.75% and of December 2005 with Libor at 1.00%  Inflation forecast of December 2005 (57 kb)  4  BIS Review 86/2005
As interest rates fall, intermediaries take on greater risk so as to meet this demand for returns. 13  Prominent examples include, inter alia: P. Krugman (2009), “How did economists get it so wrong?” New York Times (2 September); and W.H. Buiter (2009), “The unfortunate uselessness of most “state-of-the-art” academic monetary economics”, Financial Times (3 March). 14  See: C.E.V. Borio and H. Zhu (2008), “Capital regulation, risk-taking and monetary policy: A missing link in the transmission mechanism?” BIS working paper no. 268. 15  See: Y. Altumbas, L. Gambacorta and D. Marques (2010), “Does monetary policy affect bank risk-taking?” ECB working paper no. 1166; G. Jiménez, S.R.G. Ongena, J-L. Peydro and J. Saurina Salas (2010), “Credit supply: Identifying balance sheet channels with loan applications and granted loans”, CEPR discussion paper no. 7655; and A. Maddaloni and J-L. Peydró (2009), “Bank risk-taking, securitisation, supervision and low interest rates: Evidence from lending standards”, ECB working paper, forthcoming. 6  BIS Review 45/2010  Similar institutions will adopt a similar risk-taking strategy. Herding will emerge. Risk management behaviour will become more correlated across financial intermediaries. Risk will rise not only at the individual bank level, but also across the system as a whole. 16 Moreover, since the financial sector is now exposed to greater liquidity risk as a result of such behaviour, central banks are more likely to be called upon to intervene in the future. And the magnitude of such interventions will need to increase if they are to be effective.

5 In either circumstance, the Bank will need information on the bank’s liquidity position and planning, and a lot of detailed information on the collateral it would be offering. I therefore urge the BBA’s members to send the Bank (as well as, of course, the FSA) your Contingency Funding Plans; and, secondly, to pre-position collateral with us for the DWF. Overall, we need to engage together constructively on what information the authorities need in order to handle incipient or actual distress. 5  Paragraph 14 of the Memorandum of Understanding between HM Treasury, the Bank of England and the Financial Services Authority says: "In exceptional circumstances, there may be a need for an operation which goes beyond the Bank's published framework for operations in the money market. Such a support operation is expected to happen very rarely and would normally only be undertaken in the case of a genuine threat to the stability of the financial system to avoid a serious disturbance in the UK economy." BIS Review 83/2009  5  Orderly wind down: writing “wills” There is a broader issue lurking in the background here, and in today’s environment we can and must address it openly. Last Friday, in the Bank’s latest Financial Stability Report, we emphasised the importance going forward of enhancing market discipline, notably through much better disclosures.