samchain/econo-pairs-v1 huggingface dataset:
For the last six years, the foreign exchange market has undergone profound change in three different but linked areas: the technology being used, the fragmentation of trading activity and the emergence of new players. As regards technology, the most notable development has been the shift towards pure e-trading. Algorithmic trading, high-frequency trading, artificial intelligence and machine learning are just some of the commonly used terms in e-trading. Over 70% of the transaction volume in the foreign exchange spot market now takes place electronically. The shift to e-trading has also increased the frequency of trades. As a result, information flows have risen considerably. Close monitoring of these markets thus requires greater data processing capabilities. The shift to e-trading has also led to the fragmentation of trading. With new forms of organised markets beginning to compete for the distribution of liquidity to end-users, transaction volumes on the primary interbank market have declined, in favour of new secondary market sites. Examples include secondary electronic communication networks, individual banks’ proprietary trading platforms and multi-bank platforms. Monitoring market activity has become increasingly complex as the number of sites has proliferated. Finally, the market participants themselves have changed. On the one hand, the share of transactions being executed by traditional bank dealers has steadily declined and this activity is being concentrated at the largest banks. On the other hand, new players have entered the market. In particular, companies specialising in high-frequency trading have become nonbank market makers and have started providing liquidity to end-users on a direct and open basis.

5 About the New York Fed: Announcements, Federal Reserve Bank of New York, June 12, 2020. 2/2  BIS central bankers' speeches
Last year, we announced some changes to that calculation, the most significant of which is that, starting in March, we will switch to calculating it as a volume-weighted median using data drawn from the FR 2420 data collection, rather than a volume-weighed mean using data provided by federal funds brokers. The change in the data source was made to make the calculation process more robust.28 We changed the calculation methodology because, while the mean and median are usually very close to one another, when they differ the median is a better reflection of money market activity, and because using a median enhances the reliability and integrity of the rate.29 The New York Fed published a technical note this past July that describes in detail the benefits of this change.30  BIS central bankers’ speeches  5  Our recent experience has confirmed the expectation that the transition to the median in March will result in little overall impact on the level of the effective rate over time. Figure 3 shows a time series of the mean and median rates computed from the FR 2420 data. As you can see, they remain quite close to one another. The FR 2420 data also allow us to examine closely the distribution of traded rates in the overnight Eurodollar deposit market.

One tentative indication that high capacity may be playing an important role is that unsecured rates appear to have settled in about the same position relative to IOR as before liftoff, even though one might have expected the widening in the IORON RRP spread and the lower support from the ZLB to result in some downward shift. The ON RRP also has a per-counterparty cap, which was, and is, $ billion. It seems that the current level of the per-counterparty cap was also adequately large for perceived individual “headroom,” thereby supporting lender bargaining power. Figure 14 shows summary data on how frequently we receive large bids in our operations at the ON RRP and term RRP facilities. As you can see, we rarely see bids of more than $ billion, and combined individual counterparty usage across overnight and term operations has never exceeded $ billion. Recently, we learned a bit about the term RRP operations. We have been conducting these over quarter-ends as a way of providing additional RRP capacity. Additional capacity is available because term RRP operations are subject to a separate overall size limit, and because there is no per-counterparty cap in those operations. Counterparties appear to regard these as close substitutes for ON RRPs, and as shown in Figure 15, we’ve typically seen that overall RRP take-up, across overnight and term RRP, has been fairly stable across quarterends. At this past year-end, there was essentially no take-up at the term RRP operations.
News conference on new banknotes  Berne, 3 September 2019 Fritz Zurbrügg  Introductory remarks by Fritz Zurbrügg  Ladies and gentlemen I am very pleased to welcome you to our presentation of the new 100-franc note, the last denomination of the ninth banknote series to be issued. To mark the final milestone in this challenging project, as well as inviting the media we also have some guests here who were heavily involved in developing and producing the new banknote series. It gives me great pleasure to welcome representatives from our suppliers Orell Füssli, Landqart, Sicpa and Kurz. I am going to start by unveiling the hotly anticipated 100-franc note, before showing you the full series, with all six denominations together for the first time. My colleague Thomas Jordan will then review the issuance process for the entire new series, before looking to the future. After that, we will take your questions on the new 100-franc note, and the ninth series in general. We do of course have all the denominations here with us, so that you can take photos of both the 100-franc note and the entire series. Finally, we will round off today’s event with a drinks reception, to which you are all warmly invited. But let’s start by unveiling the last denomination in the new banknote series. Voilà, the new 100-franc note. I’ll now take you through the details of the new note. Like its predecessor, the new 100-franc note is blue.

So even the conventional IS curve says the result would be stronger demand. But let’s  Page 14  suppose the “drop” is financed by a tax on other, non-monetary assets, leaving household wealth in aggregate (the “W” term) unchanged. Because people’s financial positions differ, partly by age – older people have positive net financial wealth, those who’ve just bought a house have negative “W” – this pair of transactions redistributes resources, away from long-term savers and towards borrowers. And if the latter group is “credit constrained” – if they’d like to spend and borrow more at the prevailing level of interest rates but, perhaps for want of collateral, cannot do so – then this transfer should boost demand. Net payers of the tax will cut back on their spending by less than the increase in demand from beneficiaries of the policy. Even when offset by an equal and opposite tax, and even for given interest rates, this addition of liquid assets would add to demand and inflation. To me this sounds perfectly plausible. Indeed the MPC has often argued that these constraints can matter for the transmission of more standard changes in interest rates. If borrowers are (on average) more credit constrained than savers, and therefore more sensitive to changes in cash flow, equal declines in debt interest costs on the one hand, and deposit receipts on the other, will on balance be expansionary. Nor is this the only way in which a “helicopter drop” might matter.
With effect from 2010, CPI inflation will also rise, according to our forecast. Once again interest rate changes have had a powerful impact, but they are now pushing in the opposite direction. In 2010 we are expecting to raise the repo rate again. Mortgage rates will then cease falling and begin to rise instead. At the same time, energy prices will begin to rise slightly. The repo rate will then be raised fairly rapidly, from a level of around 1 per cent to around 3 per cent at the end of the forecast period. The fact that I am now talking about the forecast for the CPIF should not be interpreted to mean that we have changed the monetary policy target. Our target is still that CPI inflation shall be 2 per cent. But we are also constantly studying a number of other measures of inflation. In this situation with exceptionally large changes in the repo rate –first down to just below one per cent and then rapid increases at the end of the forecast period – it is very important to openly and clearly illustrate the direct consequences this can have on the CPI. However, in the longer term, beyond the horizon for our forecast, the repo rate is assumed to be stable and then the rate of increase in the CPI and the CPIF will coincide.

Lower wealth, together with the widespread uncertainty over future events, may lead to companies and households postponing investment and consumption. All of this affects the activity in the economy and is something we must take into account when formulating our policy. Many measures that are taken mainly with the aim of safeguarding financial stability at the same time have monetary policy effects. For instance, measures that lead to greater confidence in the markets contribute to lower interest rates and increased access to credit. 2  BIS Review 23/2009  …and monetary policy affects financial stability. But inversely, monetary policy also has an effect on financial stability through its influence on economic activity. An economic downturn normally leads to unemployment rising and more companies going bankrupt. Households and companies find it more difficult to pay interest and amortise their loans and the banks risk facing loan losses. The banks become more cautious, require larger margins and collateral as compensation for lending money. This reduces the supply of credit, which further reinforces the downturn in economic activity. In addition, it may be the case that the banks earn less money from their lending in such a situation. Lower wealth together with greater uncertainty over future economic developments can mean that households and companies neither will nor can borrow as much. To the extent that monetary policy measures alleviate the fall in economic activity, they are also beneficial to financial stability.
The short-term real interest rate, that is the short-term nominal interest rate minus inflation, is commonly used to describe how expansionary monetary policy is. This can be assumed to average approximately 2 per cent in the longer term. In the United States, the real interest rate was negative in the period 2003–2005, while in the euro area it was approximately 0 per cent in the same period (see Figure 1). At the same time, China and other countries had their currencies tied to the US dollar, which resulted in expansionary monetary conditions in these countries too. Large current account surpluses in China and in oil-producing countries led to capital flows to the United States and the euro area and this also kept down long-term interest rates. The consequences of the expansionary monetary policy became apparent in the development of the economy. Inflation in the United States was over 2 per cent measured using various measures of core inflation, Resource utilisation was higher than normal and there was a rapid expansion of credit. From the mid-1990s to 2006, real housing prices increased unusually rapidly, by approximately 80 per cent, after having been relatively stable from the early 1950s to the mid-1990s (see Figure 2). Housing prices increased dramatically in some parts of Europe too, for example in Ireland and Spain, while they remained largely stable in other countries, for example Germany. However, for the euro area as a whole the increase in prices was not as large as in the United States.

As always, the views presented here are my own and do not necessarily reflect those of the Federal Reserve Bank of New York or the Federal Reserve System.1  Money-like assets versus safe assets Money-likeness and safety, although closely related, are not completely overlapping concepts.2 Safety refers to an asset’s lack of actual and perceived exposure to risk, including credit risk, counterparty risk, interest-rate risk, and market risk.3 Money-likeness refers to an asset’s lack of information sensitivity, such that, when it is used in transactions, economic agents need not worry about its future value, at least in the short term and in most states of the world.4 Because of this, money-like assets are usually short-term, liquid assets with no credit or counterparty risk, promising a fixed payment in nominal terms.5 In normal states of the world, investors tend not to distinguish too carefully between and among money-like and safe assets. However, in non-normal states of the world, where investors have heightened perceptions of risk—partly because of underlying credit or counterparty issues, but also critically because of uncertainty about the actions of other investors—investors tend to view directly-held liabilities of the official sector as substantially safer than those of the private sector. In these non-normal states of the world, central banks have the unique ability to quickly produce large quantities of assets that are both safe and money-like.
In fact, in annual terms, the seasonally-adjusted series of total and other GDP grew more than the original series: 1.3% and 1.5% respectively (figure 2). Second-quarter activity was also influenced by some one-time shocks that hit the manufacturing industry. Even so, the stronger impulse of the more consumer-related activities, such as trade and services, continues to stand out, while some investment-related sectors, such as construction and some business services, have weakened further. Total domestic demand increased 3.9% annually in the second quarter, with significant inventory build-up, partly responding to replenishments after a long period of depletion. However, there are signs that it may have been more than the state of the cycle would suggest, which could result in reduced imports in the coming months. In turn, final domestic demand —excluding inventories— was somewhat lower than expected, and continued to account for the dissimilar behavior of consumption and investment (figure 3). Consumption shows a somewhat stronger growth, with improvements in several of its fundamentals. One important concern about the economy early in the year was the deterioration of the labor market, in particular the salaried employment drop in annual terms. This was one of the risk factors that led us to accelerate the MPR reduction at the beginning of the year. This risk has faded in recent months. Indeed, in the last few months salaried employment has resumed its positive annual variation rates and some of its quality indicators have ceased to deteriorate.

Chile) External prices (in $  1.9 2.9 3.1 2.5 1.5 6.7 1.8 -1.5 -2.7  4.7 3.3 3.4 2.8 2.2 6.5 1.7 1.1 2.4  LME copper price $ WTI oil price $ Brent oil price $ Gasoline parity price $ Libor $ (nominal, 90 days)  221 43 44 389 0.7  255 50 53 453 1.5  Sep.17 Report  2018 (f) Jun.17 Report  2019 (f) Sep.17 Report  Sep.17 Report  (annual change, percent) 8.5 -0.5 3.5 3.4 3.6 3.5 2.9 2.9 2.1 2.3 6.7 6.3 1.9 1.7 1.1 2.2 3.2 1.4 (levels) 275 250 49 51 52 53 450 447 1.4 2.5  0.0 3.5 3.6 3.0 2.3 6.4 1.7 2.1 1.6  -1.8 3.4 3.6 2.9 2.2 6.1 1.7 2.4 2.3  275 49 52 440 2.3  270 49 52 435 3.0  (f) Forecast. Source: Central Bank of Chile. Figure 9 Activity gap (*) (percentage points)  4  4  2  2 Sep.17 Report  0  0  -2  -2 Jun.17 Report  -4  -4  -6  -6 02  04  06  08  10  12  14  16  18  20  (*) Gray area shows lowest and highest gap estimates using different estimation methods for potential GDP (HP, SVAR, MEP, FMV, trivariate filter and SSA). See Fornero and Zúñiga (2017). Source: Central Bank of Chile.
6  All speeches are available online at www.bankofengland.co.uk/news/speeches  6  Chart 6b: But households still optimistic about their own prospects Differences from averages since 1985 (number of standard deviations) 1.4 1.2 General economic situation expectations  1.0 0.8 0.6 0.4 0.2 0.0 -0.2 Personal financial situation expectations  -0.4 -0.6  Jan. 16  Jul. 16  Jan. 17  Jul. 17  Jan. 18  Jul. 18  Jan. 19  Sources: European Commission, University of Michigan consumer sentiment index, and Bank calculations. Notes: The chart shows the median across the G7 euro area countries (France, Germany and Italy) and the US. Reconciling market moves with global developments All in all, the risks to the global economy have shifted to the downside. But to what extent? Does the sea change in financial markets presage a sea change in the global economic outlook? And what does the UK experience suggest? A lot will rest on the scale and breadth of the trade effects. Traditional trade models suggest that the direct effects of the tariff measures implemented so far4 are likely to be small. The Bank estimates that these measures will reduce global GDP by only around 0.1%, and the further US-China tariffs that took effect in May and June will roughly double that effect (Table 1).5 But that may not be the end of the story.

In his presentation today, he presents a system for evaluating and ranking different policy alternatives, showing how Taylor diagrams can be used to evaluate whether one interest rate forecast results in lower volatility in inflation and the output gap than another. If a forecast results in inflation closer to target and a narrower output gap through the forecast period, this forecast is selected. On other occasions, the choice between two forecasts can be more problematic. The forecast that is selected will depend on preference and the considerations that are given weight. I completely agree with Lars Svensson that policymakers must rank the different policy alternatives based on their preferences. In some cases, policymakers may wish to keep the interest rate high while in others a low interest rate may be preferred. However, it is equally important to take account of preferences over time, i.e. having a system to check whether the preferences underlying the baseline scenario in one report are the same as those of the previous report. And once preferences have been formalised in a loss function, it is relatively simple to find the optimal interest rate path for a given model. The choice of path will then depend on policymakers’ preferences. A policymaker’s preferences may of course change over time, but I am in favour of basing the analysis on the same set of preferences as previously. This approach will contribute to consistency in communication over time. 1  Cf.
Birgir Ísleifur Gunnarsson: The Central Bank of Iceland and monetary policy Address by Mr Birgir Ísleifur Gunnarsson, Governor of the Central Bank of Iceland, to a meeting of the Reykjavík Rotary Club, Reykjavík, 27 August 2003. *  *  *  I have been invited to discuss here the economic and monetary situation and prospects from the perspective of the Central Bank of Iceland. Before turning to that subject I believe I should devote some discussion to the monetary policy framework which has been in place since March 2001. My reason for doing so is the misunderstanding, which still often arises in public debate, about the Central Bank’s role and its possibilities for influencing specific aspects of the economy. What I have to say on that point, it seems, cannot be stated too often. Iceland’s monetary framework was altered in March 2001 when the Government and the Central Bank issued a joint declaration adopting inflation targeting as the anchor of monetary policy. The chief characteristic of this arrangement is that price stability is the main objective of monetary policy. It has also been declared that inflation will be kept within certain limits over a specific period. The Central Bank is granted independence to attain this target with the instruments at its disposal. Other aspects of the new framework include increased transparency in monetary policy and communication of information from the Central Bank to the public and government.

Consider this graph:  Over the past six years, the monetary base has increased 340 percent, 10 times the rate at which the economy would have expanded in nominal terms had we not suffered the recent recession. One is hard pressed to argue that there is much efficacy derived from additional expansion of the Fed’s balance sheet. This is why I’ve been such a strong proponent of dialing back our large-scale asset purchases. It is my firm belief that the fault in our economy lies not in monetary policy but in a feckless federal government that simply cannot get its fiscal and regulatory policy geared so as to encourage business to take the copious amount of money we at the Fed have created and put it to work creating jobs and growing our economy. Fiscal policy is not only “not an ally of U.S. growth,” it is its enemy. If the fiscal and regulatory authorities that you elect and put into office to craft taxes, spending and regulations do not focus their efforts on providing incentives for businesses to expand job-creating capital investment rather than bicker with each other for partisan purposes, our economy will continue to fall short and the middleincome worker will continue being victimized, no matter how much money the Fed prints. I don’t want to ruin your evening after such a pleasant dinner.