samchain/econo-pairs-v1 huggingface dataset:
The WTO system of rules is by no means perfect, and its weaknesses must be addressed if international trade is to be generally seen as being ‘fair’ once again. That said, protectionism is definitely not the right way to make trade fairer. Rather, the debate surrounding this issue should be taken as motivation to be all the more resolute in eradicating the shortcomings of the existing system. These become evident particularly when it comes to tackling marketdistorting subsidies and hidden market access barriers in many countries. Furthermore, there is also room for improvement with regard to dispute resolution and the monitoring and transparency of WTO members’ trade measures. Finally, it would also make sense to modernise the WTO by placing a stronger focus on the services sector and online trade. Page 7/9  Conclusion Ladies and Gentlemen, dealing with economic openness is not always easy – and like others, Switzerland repeatedly faces new challenges in this regard. However, our country has learned to deal with them. The necessary flexibility has been and remains entirely conducive to Switzerland’s competitiveness. It is almost certainly no coincidence that the most productive sectors in the Swiss economy are those with particularly strong exposure to international competition. The commitment to open markets and the willingness to continually adapt to structural change are pivotal when it comes to securing a country’s competitiveness over the long term. Protectionism can only serve to delay structural change in a country, it cannot stop it. It is detrimental to competitiveness and ultimately to prosperity as well.

Thomas Jordan: Monetary policy in times of crisis. Why central banks talk to one another Summary of a speech by Mr Thomas Jordan, Chairman of the Governing Board of the Swiss National Bank, at the Energie-Apéro Etavis, Zurich, 14 May 2012. The complete speech can be found in German on the Swiss National Bank’s website  *  *  *  Mandates differ from one central bank to another. So, too, do the economic structures and business cycles of different central bank territories. These factors speak in favour of an autonomous monetary policy for each currency area. This monetary policy autonomy has proved its value for Switzerland – also in the latest crisis. Nevertheless, central banks do work with one another in a number of different ways. They exchange knowledge on a continual basis, thereby helping to improve the foundations upon which their own monetary policy decisions are made. Central banks are also able to access foreign currencies by concluding swap agreements, allowing them to better counteract liquidity shortages on the international money market in times of crisis. Finally, joint measures can have a strong psychological impact since they signal to financial markets and economic agents that the central banks are speaking with a single voice. Autonomy and cooperation are not mutually exclusive. On the contrary. In a crisis, good cooperation supports and reinforces the effects of autonomous monetary policy measures.
The Government has included a further increase in the deficit, measured as above, in the National Budget for 2004. However, the budget balance figures are influenced by transactions that have little effect on demand. For 2003 and 2004 as a whole, fiscal policy will probably generate some stimulus to activity in the Norwegian economy. As cyclical developments will probably stabilise, our forecast is based on the technical assumption that the structural deficit will not increase in 2005 and 2006. This would also seem to be consistent with the practical application of the fiscal rule, cf. the discussion by the Ministry of Finance in the National Budget for 2004. According to the fiscal policy guideline, the use of petroleum revenues over the central government budget shall over time correspond to the expected real return on the Government Petroleum Fund. At the same time, fiscal policy shall contribute to smoothing fluctuations in output and employment. Since the introduction of the fiscal policy guideline in spring 2001, the scope for manoeuvre in fiscal policy has been reduced. The projection for the Petroleum Fund’s expected real return has been revised down substantially since the Revised National Budget for 2001. Wage growth in the years 1998-2003 indicates that the degree of labour shortages in all sectors of the labour market plays an important role in wage formation.

The Riksbank's policy rate and average lending rates from monetary financial institutions to households and companies, new agreements, all interest-fixation periods. Sources: Statistics Sweden and the Riksbank. Unclear whether the Riksbank's purchases contributed to the krona remaining weak One of the motives behind the Riksbank's acquisition of assets was to avoid the krona strengthening in a situation where inflation was already too low. In that case, inflation would have been pushed down by lower import prices and the demand for Swedish export products would have fallen. This would have brought down economic activity, which would have further dampened inflationary pressures. Since other central banks also had large purchase programmes, the Riksbank's intention was precisely to avoid the krona becoming too strong, not to weaken it.16 It is hardly possible to say with precision how the Riksbank's acquisition of assets affected the exchange rate. The analysis is complicated by, among other things, the fact that the Riksbank published decisions on the asset purchases at the same time as decisions on the policy rate.17 One indication that the purchases had the intended effect is that the krona did not strengthen but weakened, despite the fact that the ECB's monetary policy became increasingly expansionary through both interest rate cuts and extensive asset purchases. However, it is difficult to see any clear evidence that the effect arose as a result of the Riksbank's purchases, for example by foreign investments being crowded out of the Swedish market during this period.
Anita Angelovska Bezhoska: Enabling environment for capacity building Opening speech by Mrs Anita Angelovska Bezhoska, Vice-Governor of the National Bank of the Republic of Macedonia, at the Center of Excellence in Finance (CEF) coordinators meeting, Skopje, 1 December 2010. *  *  *  Dear ladies and gentlemen, Dear CEF coordinators, distinguished representatives of central banks and ministries of finance in the region, dear representatives of the International Monetary Fund, International Labor Organization and, last but not least, dear organizers of this event, representatives of the CEF (Center of Excellence in Finance), I wish you all a warm welcome. I am delighted that this year the traditional meeting of the CEF-coordinators takes place in the Republic of Macedonia and it is focused on a very important topic: “Enabling environment for capacity building”. No doubts that the knowledge does not have boundaries. All of us, during our lifetime do try to compile as much wisdom as possible, to broaden our knowledge horizon and augment what we already know. In our professional life, we face a constant intellectual and public debate, which tries to challenge the existing paradigms, to offer new insights and to establish new norms. All of this, of course, for the purpose of building stronger intellectual and analytical capacity for efficiently coping with forthcoming professional challenges. Sometimes, unprecedented events are needed to reveal the deficiencies in the currently accepted system of knowledge. These types of events underscore the weaknesses and pinpoint the missing parts of the puzzle.

•  If central bank reserves are included in the leverage exposure measure, banks must think carefully before accepting a deposit. If it implies an increase in their overall asset size, their leverage capital requirement will increase commensurately, and that will bring a shadow regulatory cost of the same order of magnitude as those calculated in the paper. This disincentivises competition for deposits, and drives a wedge between the central bank policy rate and rates that banks will pay on wholesale deposits. •  If central bank reserves are removed from the exposure measure it instantly gives banks somewhere to place cash without impacting their leverage ratio. They would therefore maximise profits by competing for deposits at rates all the way up to the rate that can be earned on reserves at the central bank, thus improving passthrough to average bank deposit rates and strengthening the transmission of  2  For example, IMF (2009) and Aikman et al (2014), and others. BIS central bankers’ speeches  3  monetary policy to the real economy. And the early indication from market participants is that they do indeed expect this change to strengthen the link between money market rates and Bank Rate. In short, although regulatory innovations such as the leverage ratio are here to stay, we can and should attenuate some of their impact on money market function where it is possible to do so without reducing the financial stability benefits.
Risk premiums on projects that do not meet green standards should reflect the higher risk associated with these projects. Similarly, discounts should not be given for so-called green projects unless there are financial reasons for doing so. A green investment does not necessarily involve lower financial risk. In order to identify and adapt to their own climate risk, banks depend on relevant disclosure by 4/7  BIS central bankers' speeches  the companies in their lending portfolios. Accurately pricing risk is difficult without information about the level of the borrower’s exposure. For banks, transition risk is also a source of financing risk. There is growing interest in climate risk among financial investors, including those providing credit to banks. The perception that some banks are particularly exposed to transition risk may have implications for banks’ funding costs and access to funding. Thus, just as banks should identify climate risk in their own lending portfolios, they must be prepared for their own investors to demand improved disclosure of climate-related financial risk. The recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) are in the process of becoming normative. Banks play a vital role in the intermediation of credit to households and businesses. Problems in the banking sector can quickly have negative consequences for the wider economy. Large credit losses or difficulties obtaining funding can have ripple effects in the form of lower lending to households and businesses. Transition risk may therefore contribute to systemic risk.

Given the subdued inflationary pressures, we have lowered the policy rate to the record level of 3.5%. The path of the credit interest rate has followed this trend, although at a slower pace. Given the weakness of the credit channel in the monetary transmission mechanism, we have tried to strengthen our impact by adopting some countercyclical measures to promote credit growth. In this regard, we have temporarily increased capital requirements for placements of banks abroad and have reduced those for credit in the domestic economy. In addition, we are promoting credit restructuring at an early phase by reducing provisioning requirements if that is the case. Several legal and regulatory measures have been taken in cooperation with other authorities and the banking industry, to improve collateral execution process and facilitate loan write-offs. The results of such measures have been mixed so far, but in the coming months we expect their impact to be noticeable. This is also linked with the commitment of the Government to pay its arrears to the private sector in the next year. Nonetheless, it is important that the banking industry continues to support sound business propositions of borrowers. Banking activity may be driven by profits but is based on relationship with its customers. Now is the time when such relationship is being tested, and good bank management must look beyond the current challenges to keep and strengthen such relationship.
In order to overcome the possible communication problems associated with this uncertainty, we have announced that we will monitor the effects of our decisions from both price stability and financial stability perspectives, and do not hesitate to implement additional measures if necessary. Although it looks quite complicated at first sight, the framework we adopt in spirit is not significantly different from the conventional inflation targeting framework. The only difference is that, previously our policy instrument was the one week repo rate, but now our instrument is a “policy mix” – which consists of a combination of short term interest rates, reserve requirement ratios and interest rate corridor. We seek to use these instruments in the right  2  BIS central bankers’ speeches  combination in order to cope with both inflation and macro-financial risks. The monetary policy stance in this framework is not only determined by the path of policy rates, but as a mixture of all the policy instruments, as I just mentioned. Just like the conventional inflation targeting framework, the policy is forward looking and contingent on economic outlook. The course of the policy mix in the forthcoming period will depend on the factors affecting price stability and financial stability. In sum, we are going through a period in which central banks policies have to be creative in dealing with the “new normal”. However, it is also important to consider country specific features in designing these strategies.

Moreover, to use the required reserve ratios as one of the policy tools to mitigate the macroeconomic and financial risks more actively in the future, the remuneration of Turkish lira required reserves is also terminated. We have been very open with the public regarding these measures. We stated that the measures implemented by the CBT are necessary but not alone sufficient to safeguard financial stability. We underscored the crucial role of coordination across all institutions. To this end, I should mention that, as a support to our policies, the Banking Regulation and Supervision Agency (BRSA) has taken a set of measures to (such as restricting loan to value ratios for certain segments of bank credits, increasing the minimum payments on credit cards) in order to contain the credit supply. BRSA eliminated the ban designed to safeguard investor demand for government debt, and permitted Turkish Banks to sell TRY denominated securities starting from October 2010. Finally, the government also supported our efforts by saving most of the extra revenues acquired by the faster-than-expected pickup in economic activity. In addition, government raised Resource Usage Support Fund (KKDF) deductions on consumer loans to roll back measures taken during the global crisis. Another issue we considered while formulating current policy mix is lengthening the maturity of capital inflows. This is important for improving the quality of the capital account and avoiding exchange rate misalignments. We decided to adopt a policy mix to deal with this situation.
Monetary policy has limited short-run effects on household indebtedness and – with low and stable inflation – no long-run effects As I said earlier, a possible explanation for the tight monetary policy is that in practice the aim has been to limit household indebtedness, that is, the household debt ratio. As far as I can see, there is a misunderstanding here about what monetary policy can achieve with regard to household indebtedness. As I pointed out in a speech in November last year (Svensson 2012c) and at the monetary policy meeting in December (Sveriges Riksbank 2012d), according to established theoretical and empirical research, including the Riksbank’s own studies and calculations, for example Riksbank (2011), monetary policy has very little short-run impact on household indebtedness and, with low and stable inflation, no long-run impact. Household debt has risen to approximately 170 per cent of disposable income. The debt is mainly mortgages, so in order to understand the development of debt and whether it is a problem, we must understand developments in housing prices and the value of housing. Households’ real assets (owner-occupied homes, second homes and condominiums), have grown in pace with their debt and there is a stable relationship between them. The loan-tovalue ratio, the ratio of debt to real assets, has been relatively stable and has remained in the interval of 50–60 per cent since the mid-1990s (Figure 4). There has been considerable research into how housing prices are determined.

Lars E O Svensson: Monetary policy and employment – monetary policy is too tight Speech by Prof Lars E O Svensson, Deputy Governor of the Sveriges Riksbank, to the Swedish Trade Union Confederation, LO, Stockholm, 16 January 2013. *  *  *  I would like to thank Karolina Ekholm, Gabriela Guibourg, Kerstin Hallsten, Per Jansson, Kerstin af Jochnick, Pernilla Johansson, Ulf Söderström, Staffan Viotti and Anders Vredin for useful comments and discussions. Anna Lidberg and Marianne Sterner have contributed to this speech. The views expressed here are my own and are not necessarily shared by the other members of the Executive Board of the Riksbank or by the Riksbank’s staff. Monetary policy is too tight in Sweden Although I am myself a member of the Executive Board of the Riksbank, it is hardly a secret that I see major problems with Swedish monetary policy. In a shorter-run perspective one can note that both CPI and CPIF inflation are now significantly below the inflation target of 2 per cent, and that unemployment is way above a reasonable long-run sustainable rate. There is no doubt that monetary policy has contributed to this, in that it has been too tight since the Riksbank began raising the policy rate in the summer of 2010. This may of course sound strange given that the policy rate is at a historically low level.
The key policy instrument used in this endeavour is the establishment of policy interest rates for borrowing (Repurchase Rate) and for lending (Reverse Repurchase Rate) that operates through the Bank’s Open Market Operations. The Central Bank conducts Open Market Operations to keep the level of Reserve money in the system at an appropriate level, while it uses the Statutory Reserve Ratio (SRR) on commercial bank deposit liabilities to further support the monetary policy. Financial System Stability, the other core objective of the Central Bank, is achieved through the regulation and supervision of financial institutions, the overseeing of the financial infrastructure which includes critical payment and settlement systems, as well as keeping a close watch on the financial markets as a whole. To achieve this objective, the Central Bank employs a series of prudential and regulatory measures. In addition to the core objectives, the Central Bank provides policy advice to the Government and vital state sector enterprises to strengthen macroeconomic stability and to enhance growth prospects. The Bank also undertakes several agency and ancillary functions, which include managing the Foreign Reserves of the country, Public Debt and Employees’ Provident Fund (EPF). Further, the Central Bank plays a key role in broadening the financial infrastructure and strengthening the small, medium and microfinance sectors in the country. 2. Outline of today's statement  The policy statement presented today for the year 2007 and beyond focuses on several areas.

The achievement of such a target will be facilitated by continued economic growth resulting from high public and private investment and savings, improving competitiveness, gradually rationalised expenditure which leaves sufficient funds for development work, and reducing the budget deficit resulting in low demand pressure. Needless to say, the Central Bank will actively support strategies that ensure such outcomes. In addition, transparency of monetary policy decisions and operations will be maintained to enhance the policy effectiveness and during the year we will also seek the views and advise of experts in the field of economics and on macroeconomic management in order to benefit by their expertise in our monetary policy decision making process. Further, as done in the past, the policy announcements will continue to be made according to an advance announcement calendar, and the Calendar for 2007 is set out below. Table 3 Monetary policy announcements for 2007  10  Month  Date of Monetary Policy Announcement  January  18 Thursday  February  15 Thursday  March  16 Friday  April  11 Wednesday  May  16 Wednesday  June  15 Friday  July  18 Wednesday  August  16 Thursday  September  14 Friday  October  17 Wednesday  November  16 Friday  December  14 Friday  BIS Review 8/2007  6.
Here, the buyer makes a down payment equal to 20 percent of the asset value and borrows the other 80 percent of the purchase price in the form of a home mortgage. We would say that the borrower’s leverage is 5 (the asset value divided by the equity share). Now, it’s easy to see that reducing debt and reducing leverage are the same thing when asset values are constant. If the borrower in our example pays down half the mortgage and the house value doesn’t change, her leverage has fallen to 2.5. Unfortunately, house values fell from 2007 to 2011. So while households were trying their best to reduce their mortgage debt, their leverage was actually rising, since house values were falling much faster than debt. It was really only in 2012 that leverage in residential real estate began to fall, because house prices stopped declining faster than housing debt. In 2013, leverage continued to fall, even though net mortgage borrowing resumed, because house values rose even faster. I think this distinction is important, because if we think that households have been steadily deleveraging since 2008 we might wonder whether we were getting close to the finish line. 4  Meta Brown, Andrew Haughwout, Donghoon Lee, and Wilbert van der Klaauw (2011), Have Consumers Been Deleveraging? Federal Reserve Bank of New York, Liberty Street Economics blog, March. 4  BIS central bankers’ speeches  After all, the labor market has been recovering, albeit slowly, for several years.

Consumers with substantial student debt may not be able to meet the stricter debt-to-income (DTI) ratio standards that are now being applied by lenders, particularly on mortgage loans. We believe that student debt growth among new graduates has been higher in the most recent years than growth in their incomes. In addition, delinquency in repayment has become more prevalent among student borrowers, and those with past delinquencies are likely to find it much more difficult to borrow. This decline in credit accessibility is also captured by credit scores. During most of the first decade of the 2000s, those with and without student loans had comparable average credit scores at ages twenty-five and thirty, but since 2010, student loan borrowers have had significantly lower average credit scores. As a result of tighter underwriting standards, higher delinquency rates, and lower credit scores, consumers with educational debt may on average have more limited access to housing and auto loans and, as a result, more limited options in the housing and vehicle markets. This disadvantage may compound the difficulties of young people who enter a depressed labor market; in addition to facing a spell of unemployment that may lead to reduced earnings for a considerable period of time, they may also face tighter future credit constraints as a result of delinquencies on their student loans.