samchain/econo-pairs-v1 huggingface dataset:
The opposite holds, of course, for those who always prefer a higher interest rate. I expect we shall have to learn to live with this type of monetary policy personification. But I hope that in time the discussion that follows our decisions and published minutes will still lead to a wider understanding, among people in general as well as in markets, of the deliberations and choices the Executive Board has to make. For market players I continue to believe that fundamentally it is most important to arrive at their own sound assessments of inflation. Those who do so are likely to be fairly close to the mark in their predictions of the repo rate, at least in the somewhat longer perspective. 3. The current monetary policy situation  Let me now consider the present situation, starting from the Inflation Report the Riksbank presented last week. The assessment in the Inflation Report The signs of a global recovery have been confirmed and also become stronger since the June Report. The Riksbank has accordingly made an upward revision to the forecast for GDP growth in the OECD area, to an annual rate of not quite 2.5% up to the end of 2001. The growth is occurring on a wide front. The Asian and European economies are recovering, from different initial situations, and the slowdown in the United States is expected to be milder than we counted on earlier. Even with the prospect of higher global economic growth, international price pressure is assumed to remain relatively low.

This has naturally affected analyses of the Riksbank’s behaviour and resulted in a somewhat new type of discussion about monetary policy and, not least, the Riksbank’s communications. That brings me to the next point. 2. New Executive Board means new conditions  Transparency desirable The new Riksbank legislation has altered the conditions for how the Riksbank operates and communicates externally. The strong statutory independence makes it extra important that openness is practised as much as possible and that what we do can be examined and evaluated. These are basic arguments in the interests of democracy. The law makes the Executive Board collectively accountable for running the Riksbank as well as for its monetary policy decisions. The Board concluded that the important discussion ought to be held in session, not in corridors, and ought also to be minuted in such a way that it can be assessed. Having established this, the way in which we should communicate externally more or less presented itself. Each Board member should be answerable for her/his opinion. The members’ individual responsibility is thereby clarified. So when one of us makes a speech, it is not normally a joint monetary policy signal but the expression of a personal opinion. I willingly admit that this was accompanied by purely practical considerations to do with the difficulty of coordinating six strong wills before every speech or interview. There probably are not many other collective decision-making assemblies that publish their members’ positions so openly or so soon after decisions have been made.
Indeed, because of the volatility in the speed at which money circulates, the relationship between money growth and inflation fluctuates over time; it is neither causal nor automatic.3 That said, since its creation, the Eurosystem has always monitored monetary aggregates, even if their relative importance has gradually declined – a change that was confirmed in our last strategic review in 2021. Since the start of the asset purchases in 2014, money growth has remained contained. During the Covid crisis, however, the exceptional fiscal and monetary support measures led temporarily to an expansion of household and corporate bank deposits: M3 growth reached 12.5% in January 2021.4 But since then, growth in monetary aggregates has fallen steadily, reaching 4.1% in December 2022. A simplistic interpretation of the “monetarist” approach could therefore, paradoxically, prove reassuring today – but artificially so. 1  Irving Fisher (1911), The Purchasing Power of Money. Milton Friedman (1956), “The Quantity Theory of Money: A Restatement” in Studies in the Quantity Theory of Money, edited by M. Friedman. 3 See article by Sargent and Surico (2011) “Two Illustrations of the Quantity Theory of Money: Breakdowns and Revivals”, American Economic Review, Vol. 101, No. 1, and the BIS Bulletin by Borio, Hofmann and Zakrajšek (2023) “Does money growth help explain the recent inflation surge?”.

4/4  BIS central bankers' speeches
Kerstin af Jochnick: A springboard for the monetary policy meeting in September Speech by Ms Kerstin af Jochnick, First Deputy Governor of the Sveriges Riksbank, at a meeting at Danske Bank, Stockholm, 21 August 2012. *  *  *  It has become something of a tradition for us members of the Executive Board of the Riksbank to hold a speech at the end of August about the current economic situation and developments during the summer. I think that this is a tradition worth upholding. True, not many people here today manage to completely cut themselves off from world events during their holidays. We still manage to maintain a watchful eye on the inflow of news and statistics. However, although I believe that many of us follow the economic news coverage during the summer months, it may be useful to have a round-up of what has happened. It provides an overview and can act as a “springboard” for starting work in the autumn. A natural starting point for me is the assessment of economic developments described by the Riksbank in the Monetary Policy Report published in early July. I therefore intend to run through this assessment briefly and comment on my own thoughts at the meeting in July. I shall then try to summarise developments since then. Of course, this concerns to a large extent the crisis in the euro area, although some interesting statistics have also been received.

We introduced the core elements of the new series – hand, globe, real location and object – when we launched the 50-franc note; naturally, these feature prominently on the 20-franc note, too. There are many additional design elements, such as line structures in the background and renderings on the security strip, all of which play on the note’s theme and key motif. Everyone will interpret these design elements in their own way. But let me make one or two purely descriptive points. The hand on the front of the note holds a prism through which light is dispersed into various colours. On the globe, the motif of light is echoed in the constellations. The background line structures on the front of the note are reminiscent of a kaleidoscope in which colourful patterns are produced through reflected light. The real location on the back of the note depicting a film festival is emblematic of Switzerland’s creative and cultural scene. Light plays an important role here as well. By projecting it onto a screen, we create a kind of second – ‘artificial’ – world. The object on the  Page 2/3  Berne, 10 May 2017 Fritz Zurbrügg  News conference on new 20-franc note  20-franc note – a butterfly with its scale-covered wings that diffract light into iridescent colours – symbolises the rich diversity of colours and shapes in nature. Let me conclude by looking to the future. We will start issuing the new 20-franc note on 17 May.
What is important is that at the moment of the decision, after having had the possibility of analysing all pertinent information and data, market participants can correctly predict our decision thanks to their intimate knowledge of our policy. 2  BIS Review 5/2005  ECB’s communication in practice Some features of the ECB are bringing about major additional challenges for external communications. In particular, the ECB operates in a multicultural environment with 12 different cultures and 10 different languages in the euro area and 25 cultures and 20 languages within the scope of the European System of Central Banks. And, the ECB was given the very ambitious challenge to be fully credible from day one, without track record and to issue a currency which would be immediately as credible as the most credible legacy currencies. In the practical implementation of the communication policy we make use of a wide range of communication tools. I will mention only a few of them here: First, the monthly press conferences after the first Governing Council meeting in each month. The introductory statement at the press conference is a key element in our communication as it conveys the collective view of the ECB’s Governing Council on the monetary policy stance in real time. In fact, the decision to hold a press conference after each policy meeting was unheard of among major central banks prior to the euro.

The decentralised nature of the Eurosystem is an asset especially for communications with the general public. The Governors address in their country their national public in their own language. They are very well placed to participate in economic debates taking place in their home country. Finally, the ECB publishes a large array of statistics, adding essential information on the euro area available to financial markets and all other interested agents. There has been an ongoing process of extending the number of statistical series released by the ECB, which I expect to continue in the future. As a latest example, last week we have published for the first time a press release providing a geographical breakdown of balance of payments and international investment position statistics. Our concept of transparency Transparency serves our main objective of maintaining price stability. As we are a unique institution which has no precedent we have to consider very carefully the appropriate concept of transparency in our decision-making. We are convinced that as a collective body it is beneficial for the Governing Council to give its collegial assessment in the form of a comprehensive and detailed statement rather than only stating the decision and letting the interested parties wait for the detailed statement to be published later in the form of minutes. Our method of real-time communication on behalf of the Governing Council also goes to demonstrate that we are collectively accountable to the public.
In all our presentations held in several Anatolian cities, at the Grand National Assembly or in the Council of Ministers Meetings since 2001, we, as the Central Bank, has pointed at the significance of the derivatives market and indispensability of these markets. Dear Guests, Now that we have briefly considered the phase of uncertainty and the process of development of risk management in Turkey, I would like to give you an overview of this development process in the world. First of all, let me remind you that although conducting transactions on the futures market dates back to a long time ago, its development has taken a long time. Regarding this issue, I would like to share with you some information that I believe to be interesting. Aristotles’s writings inform us that the first recorded account of derivative contracts can be traced 2500 years back to the ancient Greek Thales of Miletus, for the spring olive harvest during the winter. We know that rice futures were being traded in Japan in 17th century and futures for grains were traded in Holland in 18th century. The development of the financial derivatives exchange accelerated parallel to the need for hedging increased exchange rate risk after the collapse of the Bretton Woods System in the 1970s, which lasted for approximately 30 years and provided a system of fixed exchange rate system.

Dear Guests, Today the transaction volume in derivatives markets is very much above the transaction volume in spot markets, where the trading and exchange of goods traded is realized on the same day. In 2004, the volume of daily derivatives transactions in the global foreign exchange market, excluding over-thecounter markets, was US dollar 1.2 trillion, which equals 65 percent of the total market turnover3. Dear Participants, Today we are about to bring in, and more importantly, institutionalize risk management principles and to initiate the development process of derivatives markets. This process is of great importance with respect to the overall economic activities. It should be borne in mind that this process will sometimes be arduous and time-consuming and it will also be a self-fulfilling process. Even if it takes a long time, sooner or later the derivatives markets will be established in our country. I am pleased to say that I am very happy to witness the efforts to develop derivatives markets and this achievement as well as its significance for the entire economy is a very important step for Turkish economy.
In the years 2002 - 2003 the largest job destruction was reported in the UK, as a result of transferring manufacturing and services to India, and to a lesser degree to China and other Asian countries (a total of 44% of all jobs shifted in the period 2002 - 2003). However, at the same time, in 1/3 of all instances, companies from the old EU countries generally mentioned the Eastern Europe as the destination of off-shoring. In the years 2002 - 2003 a total of over 33,000 workplaces were shifted from the old EU countries to other countries, i.e. 16,500 on average in each of those two years. Among the present new EU Member States, Hungary and the Czech Republic enjoyed the greatest popularity, whereas Poland was mentioned only occasionally. In 2005 the process of off-shoring in Europe accelerated in the period from January to November, with 32,000 jobs shifted, i.e. nearly twice the average in the period 2002 - 2003. The leader among the  13  Eng. Business Process Outsourcing. 14  Eng. Knowledge Process Outsourcing. 15  European Restructuring Monitor is the European Commission information service. All publicly announced instances of company restructuring in the EU, Bulgaria and Romania, are collected if these fulfil the following requirements: employment reduction by at least 100 people per annum, must concern companies with at least 250 employees and the reduction applies to at least 10% of employment, or at least 100 jobs are created as a result of restructuring, as the case may be.

Polska, Czechy, Słowacja.” [“The future of labour. Poland, the Czech Republic and Slovakia.”] concludes that out of the three analysed countries, the culture of innovation has the smallest chances for development in Poland. The author recommends to launch a modernisation project under the name Polska 2.0. It appears that in the homo sapiens globalus society of the 21 st century, many of the terms used in the debate on a unified Poland or the IV Republic of Poland, should adopt totally new meanings. Solidarity should not mean an algorithm for sharing the growth fruit, but should mean a policy which will allow the greatest possible number of Poles to function well on the global labour market. Patriotism should not confine to the roots of Poland, the tradition of the great fellow countrymen, but should also have a global character, i.e. lead to such behaviour and policies that will enable Poland as a country and its citizens to become successful in the fast globalizing economy, whilst maintaining close ties of Poles with their homeland. In this context, it is worth raising a few questions. -  Is the Polish educational system able to deliver a sufficient number of specialists in the fields on which the success of Poland in the global economy depends, in particular engineers, IT specialists, people with multi-language skills, incl. e.g. Chinese? 18  See the study by Aguiar M. et al. (2006) referred to in footnote 2. 19  For example, Baily M., Lawrence R. op. cit.
BIS Review 24/2007  Underlying assets The underlying assets largely consist of corporate bonds; these account for around 80 per cent. However, there are other types of credit, such as traditional bank loans and various forms of sovereign debt. The corporate bonds market currently covers more than USD 6,000 billion in global terms. This means that the outstanding volume in credit derivatives is more than twice as large as the total amount of outstanding corporate bonds. The reason for this is that credit risks are resold on the market through new derivative contracts. This is not actually any stranger than insurance companies selling part of their risks by reinsuring themselves, but it may be good to bear this in mind when looking at the statistics. Today, credit risk is priced on thousands of corporate credits through credit derivatives, although most of the trade is still in a few hundred very large companies. Companies in all types of industries and with different credit ratings are traded. Communication, such as the example of TeliaSonera, is one of the most traded sectors, together with the automobile industry and finance. The credit quality of the underlying bonds is generally very high. But appetite is increasing for underlying assets with low credit ratings. The standardised maturities have also increased in number with time and there is a tendency for longer maturities, five to ten years, to be traded more.

The bank can sell its credit risk on the company, entirely or partially, without needing to cancel the loan or to have any discussion at all with the company. At the same time, the buyer of the credit risk (the seller of the credit derivative) does not need to tie up more than a fraction of the capital that would have been required to take over the credit directly. Moreover, the buyer of the credit risk can in turn easily sell the risk to another party, wholly or partially. Reinsurance thus becomes both simpler and cheaper to manage than with regard to traditional credit insurance. Large investors such as mutual fund companies and insurance companies often want to have a particular amount of credit risk in their portfolios. The credits can actually reduce their total risk, as the prices of the credits do not have such large covariation with other prices, for instance, the prices of shares and real estate. A certain share of credits provides a more diversified portfolio, which gives lower risk for a given expected return. Credit derivatives also makes it possible to divide up credit risks into small parts and to trade these parts at a low cost. This is not possible with traditional credit insurances. As the trade is so extensive, the pricing of credit risk becomes much improved. From the economy’s point of view, it is essentially positive that the credit risk is spread to institutions outside of the bank system.
Ekholm, Karolina (2009), Some lessons for monetary policy from the financial crisis. Speech on 4 December 2009, Sveriges Riksbank. BIS central bankers’ speeches  9  Giannone, Domenico, Reichlin, Lucrezia and Lenza, Michele (2008), Explaining the great moderation: It is not the shocks, Journal of European Economic Association, 6(2–3), pp. 621–633. Jakobsson, Ulf (1997), Den svenska devalveringscykeln. (the Swedish devaluation cycle) Ekonomisk debatt, 25 (3), pp. 141–154. Jonung, Lars (1999), Med backspegeln som kompass – om stabiliseringspolitiken som läroprocess. (with hindsight as compass – stabilisation policy as a learning process) Ds 1999:9, Swedish Ministry of Finance. Reichlin, Lucrezia and Baldwin, Richard (2013), Introduction. In Reichlin and Baldwin (eds) Is Inflation Targeting Dead? Central Banking After the Crisis. CEPR/VoxEU e-book. CEPR. Summers, Peter M. (2005), What Caused The Great Moderation? Some Cross-Country Evidence. Economic Review, third quarter 2005. Federal Reserve Bank of Kansas City. Svensson, Lars E.O. (2013), The Possible Unemployment Cost of Average Inflation below a Credible Target, NBER Working Paper No. 19442, National Bureau of Economic Research. Sveriges Riksbank (2011), The Riksbank’s inquiry into the risks on the Swedish housing market. Sveriges Riksbank (2013), Financial imbalances in the monetary policy assessment. Article in Monetary Policy Report, July 2013. 10  BIS central bankers’ speeches  Figure 1. The CPIF Annual percentage change 4  4  3  3  2  2  1  1  0  0 07  09  13  11  15  Note.

I believe that the high level of debt, combined with an unwillingness to have higher debts than assets, could in such a situation have negative effects on growth in consumption.10 I would therefore feel more secure if the level of debt was lower, or at least was not increasing. But if I would feel more secure with a lower level of debt, why not use monetary policy to try to slow it down? The answer is simply that the disadvantages with using monetary policy in this way outweigh the advantages. A trade-off between target attainment at different horizons One fundamental problem here is how to make the trade-offs clear to economic agents, which is necessary if one wishes to convince them of the need to lean against the wind. The policy the Riksbank has conducted for some time means that one deliberately allows longer time for both inflation and the real economy to return to normal levels. At the same time, this is justified by the Riksbank’s mandate to stabilise inflation around the inflation target and production and employment around long-run sustainable levels. It is probably not clear to everyone how the actual aim of the policy is connected to the justification for it. The tradeoffs therefore need to be made concrete and clear – partly so that the Riksbank’s principal can assess its monetary policy, and partly so the general public can understand the basis for the policy the Riksbank conducts.