samchain/econo-pairs-v1 huggingface dataset:
Less than a decade ago, we did not even have the statistical requirements for the Monetary Union, let alone the statistics themselves for the euro area. Today, euro area statistics compare favourably with those of other major countries in many respects. A concrete example is the monthly balance of payments for the euro area and the availability of a timely, flash estimate of the euro area Harmonised  2  BIS Review 67/2004  Index of Consumer Prices (HICP). Moreover, the ECB compiles an elaborate and timely set of monthly statistics on monetary developments in the euro area and interest rates. Statistical preparations had to start early, due to the long lead times involved. On average, it takes around 18 months from inception to delivery of a new set of statistics that involves the collection of additional information from economic agents. While there is still room for improvement, which I will explain later on, I feel confident that the ECB has now at its disposal a solid set of statistics of sufficient quality for the conduct of monetary policy. Let me share with you some of the success factors and ‘lessons to learn’ from this development process. First and foremost, the achievements have been possible thanks to the intensive and fruitful cooperation and coordination with other statistical agencies.

This initiative, along with others related to a general improvement of standards and practices in several areas, would contribute to the better functioning of financial institutions and markets, leading ultimately to a full harnessing of the benefits of financial integration. I trust that, with fluent dialogue between regulators, institutions and market participants, we may be able to improve the combination of sound regulation and flexibility that would ultimately lead to a more robust and efficient financial system. I am convinced that this is a most important contribution to the smooth functioning of the world economy. Thank you. BIS Review 31/2003  3
But this means that, simply put, the people of the United Kingdom are not getting the most out of the data the Bank collects. 11  For further discussion see Broadbent (2016), “Central banks and digital currencies”, available at: http://www.bankofengland.co.uk/publications/Pages/speeches/2016/886.aspx. 12  This allows an efficient check of a firm’s cyber defences akin to the way a policeman could walk by a house and observe, from the outside, its security features – whether the gate is locked; whether it has an alarm; whether windows have been left open; what routes intruders might use to gain access to the property; and so on. BIS central bankers’ speeches  7  That’s why we are investigating ways of anonymising and de-sensitising data – fully respecting privacy laws without losing analytical content – to allow wider sharing. Progress has been encouraging creating the prospect of better informed policy making. 13 These are just two examples of a bigger programme of collaboration between the Bank and technology innovators. We are open to further collaboration and tomorrow will provide details of the next steps. Finally, the Bank is calibrating its regulatory approach to FinTech developments. FinTech should neither be the Wild West nor strangled at birth. The Bank is devoting considerable resources to ensure whatever develops is sustainable, not ephemeral. If FinTech enables a great unbundling of financial services, risks will change in tandem.

In the planning phase for the technical feasibility and during initial production tests in 2010, it became evident that the complexity of the new security features necessitated a postponement of the issue date to autumn 2012. In autumn 2011, during an early phase of the serial production, technical difficulties arose which had not been discernible in the testing phase, whose results were positive. For this reason, the SNB this year decided to conduct a comprehensive re-assessment of the entire project together with the industrial partners producing the new banknote on its behalf. As a result, several mostly technical measures were defined and in some cases have already been implemented. These measures should ensure that the series can go into long-term industrial production. Owing to the complexity and scope of the necessary work, the first denomination of the series, the CHF 50 note, may be expected in 2015 at the earliest. The SNB will announce the issue date as soon as production of the first banknote denomination has been completed. Since the National Bank wants to continue meeting the highest quality standards, it has accepted a postponement in the new issue, a decision which was rendered all the easier because the banknotes currently in circulation continue to offer a high standard of security. BIS central bankers’ speeches  3
The inflation outlook is therefore favourable, as can be seen in the chart at the right, which looks past the changes in value-added tax that could possibly be implemented in the near future. Chart 3  “Missing” inflation Headline inflation has been below the Central Bank’s target for nearly four years, even though the negative output gap closed and then turned positive some time ago and wages have risen well in excess of what, in an average year, would be deemed consistent with the inflation target. This is not a unique case, however. In international circles, there is widespread discussion of “missing” inflation, which generally refers to the fact that wage rises are astoundingly small given the business cycle position in the country concerned. For example, countries as dissimilar as the US and Sweden are considered to be at full employment, yet wage increases are smaller than is consistent with the inflation target. In some countries, such as the US, this may be partly because the slack in the labour market is actually larger than conventional measurements indicate, as the labour participation rate is historically rather low. But this does not tell the whole tale, and in some countries it is not a very robust explanation.

In the long run, monetary policy can deliver price stability, and in the short run it can also mitigate the effects of shocks and reduce fluctuations in output and employment. But monetary policy cannot have a long-term impact on the real exchange rate. As such, it can do little to mitigate the crowding-out effect of strong growth in a new export sector. If it tried to, the effect would be only temporary, and it would come at the expense of sacrificing the objectives with which monetary policy has been entrusted – objectives that it can achieve. Industrial and fiscal policies can have such a real impact over the long term, however, and it is to them that concerned parties should turn. 9  But it is possible to choose from among various options on the spectrum between a rigid peg and a free-floating exchange rate. And it is possible to adopt another currency, either unilaterally or in bilateral or multilateral cooperation. These were the options explored in the Central Bank’s 2012 report. 4 The conclusion was that a unilateral peg with unrestricted capital flows could run aground, as it did in so many economies after capital movements were liberalised further in the 1980s and 1990s. A firmer peg such as a currency board could pose risks to financial stability, and the same was considered true of unilateral adoption of another currency. It was deemed highly uncertain – and actually unlikely – that bilateral adoption of another currency would be on offer anywhere.
The number of website hits has increased markedly since publication of our first layered Inflation Report in November last year. Recently, we have tried to pinpoint more precisely the benefits of layered communication in boosting the public’s understanding and trust. This involved conducting a so-called “randomised control trial” on two groups – a group of experts (students studying economics at university) and a group of non-experts. 10  Both  groups were randomly split with some given layered, and others un-layered, Bank of England content from the Inflation Report. This enabled a direct assessment of the impact of layering on understanding and trust. It would have been a tad disappointing if layering had had no impact. And thank heavens for small mercies that, for both the expert and non-expert groups, layering boosted reported trust and understanding scores. What was more interesting was by how much layering seemed to help. In our sample, the boost to understanding of the economy and monetary policy that came from layering the Inflation Report was larger  8 9 10  Haldane and Turrell (2017). Haldane (2017b). Haldane and McMahon (forthcoming). 5  All speeches are available online at www.bankofengland.co.uk/speeches  5  than the boost to understanding that came from having studied for an advanced degree in economics. That’s a depressing statistic for those of us who have studied economics, but great news for everyone else. (b) Educational Programme A second strand of the Bank’s engagement strategy is education.

There is now a wide body of evidence, drawn from a wide variety of settings, on the benefits of combining the insights from expert and non-expert sources when making sense of a complex world, when forecasting an uncertain future. 3  Harvesting insights from a non-expert audience appears, in these uncertain settings, to be especially valuable by providing diverse perspectives and different insights. If we turn from understanding to trust, the picture has many similarities. Trust lies at the heart of the social contract between institutions and societies, between policymakers and citizens. But the very nature of trust appears to have changed rather fundamentally over the recent past. Societies and individuals have 4  undergone what Rachel Botsman in her recent book calls a “trust shift”. Where once trust was institutionalised and anonymised, today it is socialised and personalised. This shift in the gears of trust has had consequences. Public institutions of all stripes have been one of the 5  casualties, with measured trust having fallen steadily over the recent past. Most central banks have not escaped these shifting sands, in particular since the global financial crisis. For them and us, the age of innocence, or at least the era of taking public trust as given, may be over. That matters. Credibility and trust are the secret sauce of central banking. They are what enable them to shape expectations in ways which stabilise the economy and financial system. An economy or financial system without trust, history tells us, ceases to be a system.
For excessive I mean liquidity that poses a medium or long-term threat to price stability or starts to boost asset prices to levels not justified by economic fundamentals. Certainly, a normative concept is needed to define excess liquidity. I hope that these two  BIS Review 149/2007  1  days will help us to make progress in reaching a common understanding on how to assess global liquidity insofar as the concept is established. Looking at the current situation, at least it can be asserted that global liquidity has been increasing at a sustained and vigorous pace over the past few years. We are also experiencing high asset prices all across the commodity markets and in some areas both, the housing markets and the stock markets. Commodity prices – notably oil and food prices – are also now rising strongly at the global level. In my view, we should be concerned about – and, as central bankers, alert to – the possibility that there may be a spillover into consumer prices. In particular, the wide availability of financial capital at low interest rates across the largest international financial markets has partly contributed to the significant rise in the prices of various assets in the recent years. Concerns about the impact of ample liquidity on asset prices – notably the underpricing of risks that has been signalled by the ECB – have been repeatedly voiced.

First of all, when talking about liquidity, it is important to clarify that, in the field of central banking and monetary policy, there are at least four distinct definitions of liquidity – each with its own implications for policy-making. The first relates to “central bank liquidity”, which is provided to the money market in order to steer short-term interest rates. The second refers to the general “monetary policy stance”, as summarised by the level of policy interest rates. The third relates to “financial market” liquidity, which is defined as the ease with which large volumes of financial securities can be traded, without affecting the market price. The fourth refers to “ monetary liquidity”, which is defined in quantitative terms on the basis of monetary and financial aggregates. While all are important – indeed key – to monetary policy-making in the current environment of strong money and credit growth at the global level, I deem it necessary to say a few words on this last type of liquidity. I think you would agree that it is difficult to precisely measure global monetary liquidity. There seems to be no universally accepted definition of it among economists. Several measures have been suggested and they all differ in many respects. They can be based on different monetary and credit aggregates; they may vary according to geographical coverage; and finally, they can be constructed using different types of aggregation. Even more challenging is diagnosing at what point global monetary liquidity becomes excessive.
When turnover in a competitive market falls, prices normally decline, too, but in some respects the opposite now seems to apply. Local authorities, for instance, are trying to make up for a loss of tax revenue by raising prices for water, public transport and the like. From the media it looks as though there is a similar tendency in civil aviation authorities and some air transport, for example. 3. CPI and administratively priced services Percentage annual change 5 4  5 Administrated prices on services CPI  4 3  2  2  1  1  0  0  -1  -1  Ja  n95 Ju l-9 Ja 5 n96 Ju l-9 Ja 6 n97 Ju l-9 Ja 7 n98 Ju l-9 Ja 8 n99 Ju l-9 Ja 9 n00 Ju l-0 Ja 0 n01 Ju l-0 1  3  Source: The Riksbank  The Riksbank has no direct cause to regard administratively determined price increases differently from market increases: both contribute to inflation. But when the former accompany declining resource utilisation, it obviously complicates matters for monetary policy. In addition, these observations naturally raise other questions that have to be dealt with, not by the Riksbank but by parliament and the local authorities and have to do with competitive conditions in the Swedish economy. BIS Review 89/2001  3  The exchange rate Recently the exchange rate has also been the subject of a lively discussion.

Technical know-how alone is not enough. Our communication strategy should be guided by three principles: To say it correctly, to say it well, to say it differently. This will require an astute awareness of relationships from a social, economic and political standpoint. Through this understanding, we will be able to articulate our ideas or positions more clearly and coherently. The use of multiple platforms, such as social media, instant messaging services, or public online forums will offer new possibilities. Ralph Waldo Emerson, an essayist and poet who led the transcendentalist movement of the mid-19th century, once said, “In skating over thin ice, our safety is in our speed.” This analogy is appropriate in our current environment. Responding to a dynamic environment in a timely manner will require the intuition of skill and knowledge. Many professions will see a dramatic shift in skill sets required over the coming decade, and the accountancy profession will be no exception. Given finite resources, public policy is likely to be overwhelmed by a sense of cynicism or pessimism. This is where public sector accountants may offer a breakthrough by taking on a more strategic role. As financial data expands in scope, volume and complexity, operational efficiency demands a new set of technical skills and knowledge. Complex problem solving, critical thinking, coordinating with others, service orientation, cognitive flexibility, just to name a few. Amid new international accounting standards, rising trends in financial technology and the attendant changes required, accountants are becoming among the most flexible and multi-skilled individuals.
And there will often be scope for those affected to work out ways to circumvent them, including by moving activities outside the regulatory perimeter. As Federal Reserve Board Governor Jeremy Stein has noted, monetary policy may be a blunt tool for addressing financial stability risks, but it does have the virtue that it “gets in all of the cracks”. 7 So, there may well be times when monetary policy is the only game in town to guard against incipient financial stability risks. In that case, we are back in the world where monetary policy makers need to be prepared to consciously lean against the wind by deliberately undershooting their inflation target in the near term in order to reduce the likelihood of something nastier down the road. This thinking has now been embodied in the Chancellor’s remit for the MPC, which sets our objectives each year. It notes that “circumstances may arise in which attempts to keep inflation at the inflation target could exacerbate the development of imbalances that the FPC may judge to represent a potential risk to financial stability. The FPC’s macroprudential tools are the first line of defence against such risks, but in these circumstances the MPC may wish to allow inflation to deviate from the target temporarily.” The remit also directs the MPC to have regard for the actions of the FPC and vice versa. I opened my remarks tonight by observing that my time at the Bank has neatly fallen into two halves.

Our central view is that the margin of slack is presently around 1–1½% of GDP, though I should stress the considerable degree of uncertainty around that estimate. I should also stress that this is a short-run concept, relevant to inflationary pressures a year or so ahead, and does not incorporate any endogenous improvement in productivity that may materialise in the wake of faster growth over a rather longer horizon. We have said that we are aiming to  2  BIS central bankers’ speeches  close this gap over the next two or three years, while keeping inflation at around our 2% target. We have also said that when Bank Rate does rise, it is likely to do so only gradually and to a level that is likely to remain materially below its pre-crisis average of 5% for some while. That reflects: the continuing headwinds from public and private de-leveraging and continued weak growth in the euro area; continued downward pressure on global interest rates from high Chinese net savings; and the undue compression of risk premia during the run-up to the crisis. Let me now turn to asset purchases, our preferred tool for adding stimulus when Bank Rate reached its effective lower bound. Under this programme, the Bank acquired £ billion of longer-term UK government debt – equivalent to around 25% of annual GDP – comprising £ billion purchased between March 2009 and February 2010 and another £ billion acquired between October 2011 and November 2012.
Our chances of influencing the course of events then lie in contacting the bank’s executives and informing the Financial Supervisory Authority. Our Financial Market Report can no doubt also play an important part in exerting a more continuous influence. In the longer run, the Riksbank can also contribute to stability through international collaboration, as well as by participating in Sweden in legislative work and the structural adjustment of various systems. Undervalued credit risks—a recurrent phenomenon One aspect of the Riksbank’s oversight of financial stability in Sweden has been the analysis of the run-up to the bank crisis here and the possible causes of crises in other parts of the world. The causes and course of the various crises have differed in some respects but they do present many similarities. Many of them were preceded by a period of rapidly rising asset prices and a strong expansion of credit. This period ended with an abrupt reassessment—a jolt that altered risk assessments and led to heavy losses for those involved. Signs of economic problems meant that the supply of credit virtually ceased. It seems that the stronger the credit supply in the first period, the more serious were the effects in the second phase, with decreased production and rising unemployment. BIS Review 23/1999  4  Another factor in many cases has been that the country had a fixed, but adjustable, exchange rate regime that lacked credibility.

Additionally, before this sad event, the first release of the National Accounts for 2009 and data at hand for the period preceding the catastrophe showed domestic output and demand growing faster than previously expected. Let me discuss both in more detail. Incoming information since the statistical closure of our December Report suggested that the foreseen recovery of domestic output and demand was not only materializing but doing so faster than anticipated. GDP dropped 1.5 percent in 2009, less than the 1.9 percent drop that had been forecast in December. In the fourth quarter, GDP actually rose 2.1 percent annually. These figures showed a faster recovery for those industries more closely linked to domestic demand, particularly manufacturing and retail. In the second half of the year the economy grew at an annualized rate of around 6 percent, narrowing the output gap more than December’s forecast (figure 1). Domestic demand also fell less than forecast in December. Data for the last quarter of 2009 stood out because of the performance of consumption and investment in machinery and equipment. In addition, inventories for the year as a whole had a milder depletion than previously expected. Information available prior to the earthquake and tsunami pointed to a continuation of the strong evolution of output and domestic demand. Sales indicators showed an upward trend and indices of consumers’ and firms’ perceptions were at optimistic levels (figure 2). The labour market was also picking up, with increased employment and an evolving composition by occupation.