samchain/econo-pairs-v1 huggingface dataset:
Our recent experience shows that a small currency on the highly volatile financial markets risk being more affected than the bigger currencies by factors out of its control and with no direct relevance to their economic performance. One such example was the reaction on the currency markets in the days following the 11 September events. It is also quite apparent that the present strengthening of the krona was influenced by the Prime Minister raising the issue of a referendum on EMU. Furthermore, recent experience implies that the deviations from the euro average growth should not be very large in the normal case. Even if Swedish growth and productivity have been somewhat higher than those of the euro area since 1999, recent evaluations show that that the business cycles in the euro area and Sweden are fairly synchronised, despite the asymmetric shocks due to the crises in the mobile telecommunications and IT sectors. However, it cannot be ruled out that Sweden can become subject to serious asymmetric shocks, i.e. disturbances affecting Sweden differently from the rest of the euro area. On those occasions it is important that Sweden has an alternative way of stabilising the economy. One possible instrument is of course to use fiscal policy. The Riksbank recently presented its views on the government report "Stabilisation policy in the Monetary Union" where we elaborate on the possibility of using fiscal policy to stabilise inflation in a similar way as monetary policy does today.

The UK is the exception: since the mid-1990s, the country has emerged as the growth model for Europe. For Switzerland, the sluggish development in Europe is especially regrettable, as the Swiss export sector usually serves as the engine for economic recovery. All in all, Switzerland's export industry is well positioned to benefit from higher demand from abroad. Switzerland has been able to reduce its production costs per unit in the past few years, and the Swiss franc even depreciated slightly versus the euro since the launch of the single currency. As regards domestic demand, consumer sentiment remains satisfactory overall, but this should not be expected to stimulate growth decisively. While construction activity is robust, it has lost some of its momentum. Investment in equipment is still brisk, and the recent modest slowdown should not last too long. On the whole, the Swiss economy is still on its growth trajectory, but it lacks stimuli from abroad. This situation is the same as the one underlying the National Bank's interest rate decision of December 2004. Even though Switzerland is particularly affected by the lacklustre performance of the European economy, overall prospects are not gloomy. Growth in the rest of the world remains dynamic, and this is expected to benefit Europe in due course. For Switzerland, a growth rate of 1.5-2% is still realistic. With the Swiss economy thus continuing to grow below its potential, the labour market will not see any sustained improvement. BIS Review 11/2005  1
Since inflation is at the same time lower, the differences in the real interest rate are less, however. An important reason for inflation being so low is the broad agreement on the price stability target that now seems to exist. An expression of this is that inflationary expectations remain at a stable level despite expectations on a continued very strong upswing. The Riksbank’s most important duty in future is to ensure that expectations remain at around 2% inflation. The very low inflation which is now registered has, however, surprised many people, including us at the Riksbank. An important explanation as to why GDP growth has now been able to exceed the growth in output that is possible in the long term for many years without threatening the inflation target is, of course, that the upswing started from a level of output that was greatly depressed after the years of crisis, where a lot of resources had been made redundant. When unemployment was at its peak, there were many who feared that it would persist permanently at a considerably higher level than we were previously used to. There was also opposition to the inflation target policy just for that reason. Examples were pointed to in Europe where unemployment had been over the Swedish for a long time, but where there had been greater success in combating inflation. The labour market is performing better than expected It is difficult to determine the rate at which GDP can increase in the long term.

The latter approach is called “certainty equivalence” in academic research and is a good policy only under fairly restrictive assumptions of how the economy functions. It is therefore probably less useful as guidance in policy-making. Moreover, the central banks’ actual behaviour and communication indicate that uncertainty plays an important role in the monetary policy decisions. 21 See Greenspan (2003). 20 [24]  A more useful approach is probably William Brainard’s insight that monetary policy should be conducted more cautiously when there is considerable uncertainty over its impact. 22 Brainard’s uncertainty principle is based on the insight that central banks’ actions can affect the uncertainty in the economy. If, for instance, a central bank were to act more forcefully to try to attain its inflation target more promptly – in a scenario where there is great uncertainty over the impact of monetary policy – there is a risk that it would instead miss the target by a wide margin. By acting forcefully, the central bank contributes to greater variations in inflation and also to greater uncertainty in general. To avoid this, the central bank should act more cautiously. This uncertainty principal is often referred to by central banks and can be one reason why central banks, who want to avoid making major mistakes in all circumstances, are sometimes perceived as “sluggish” in their behaviour. One of my themes today has been long-term trends. When such trends change, it often takes a long time before one notes the change and this can moreover be difficult to assess.
One of Singapore’s key roles as a financial centre is to connect investors and markets across Asia and beyond. Our expanding financial ties with China is a good example. Singapore is one of the top three offshore RMB centres globally. •  Singapore’s financial centre has played a constructive role in supporting the internationalisation of the RMB. •  This has in turn helped to forge stronger trade and investment links between China and South-east Asia. Singapore also offers a gateway for the expansion of Chinese corporates into the region. •  More than 6,500 Chinese enterprises are established in Singapore. •  Many of them have based their regional headquarters in Singapore to cover their Southeast Asia portfolio – well-known firms like Xiaomi, Alibaba, Haier, Baosteel and Qingjian, to name a few. As an international financial centre, Singapore offers Chinese corporates the necessary breadth and depth of banking and capital market services – from advice on regional markets to funding solutions. A trusted financial centre The third key attribute for the success of Singapore’s financial centre is trust. •  Financial institutions from all over the world come to Singapore because this is a jurisdiction they can trust. •  There is rule of law, clarity and consistency in regulation, rigour and fairness in supervision, and no tolerance for misconduct. Upholding high standards of integrity in the financial industry is an absolute priority.

Finally, the financial industry in many parts of the world is facing a crisis of trust. •  Financial institutions have come under increasing public scrutiny over their business conduct. •  Globally, we have seen repeated cases of mis-selling financial products, manipulating benchmark rates, and using the financial system for illicit transactions. Singapore’s financial sector has to overcome these headwinds and manage these risks as it develops further. And it must do this while seizing on opportunities presented by a growing Asia and technological change. Let me touch on three attributes that our financial sector needs to maintain and strengthen in the years ahead: resilience, dynamism, and trust. A resilient financial centre I will start with resilience. •  We cannot insulate our financial sector from the stresses and turbulence in international financial markets. •  We must remain open but be able to absorb shocks from abroad and bounce back. High prudential standards have therefore been a hallmark of Singapore’s financial sector since the very beginning. •  In recent years, we have further strengthened the resilience of the system through higher capital requirements and enhanced liquidity rules. Singapore banks operate well above the regulatory capital minimums. 2  BIS central bankers’ speeches  •  The Basel Committee prescribes a minimum Tier 1 capital adequacy ratio of 6%;  •  MAS has set a regulatory minimum of 8%;  •  The three local banking groups have Tier 1 ratios in excess of 13%.
By going through the issuance process ourselves, along with the help of external parties, we have hopefully showcased to potential green bond issuers, both locally and overseas, that Hong Kong is a convenient platform for issuing green bonds, for three reasons:  3/4  BIS central bankers' speeches  (i) Hong Kong has a strong presence of finance and legal professionals, who can advise on all aspects of the bond offering and assist in arranging, managing, co-ordinating and marketing the green bond certification and issuance; (ii) Hong Kong combines the best market practice from internationally renowned green reviewers and local agencies. For example, we obtained a Second Party Opinion from Vigeo Eiris for the Green Bond Framework and the inaugural transaction under the Framework has also received the “Green Finance Certificate” (Pre-issuance) from the HKQAA; and (iii) Hong Kong is home to leading international institutional investors, including many of the investors who have made strong commitments to green investments. 20. During the roadshow for the green bond, we were joined by our Environment Bureau colleagues to reach out to overseas investors in major cities such as London, New York, Paris, and Frankfurt, in order to demonstrate to the international community the HKSAR Government’s coordinated commitment to green finance and our broader objective to address climate change risks. We believe the exercise has gone a long way in asserting Hong Kong’s branding as the premier regional green finance hub to the leading institutional investors around the world.

Eddie Yue: Hong Kong - the Asian hub for sustainable finance Opening remarks by Mr Eddie Yue, Deputy Chief Executive of the Hong Kong Monetary Authority, at the Euromoney’s 2nd Asia Sustainable & Responsible Capital Markets Forum, Hong Kong, 25 June 2019. * * * Distinguished guests, Ladies and Gentlemen, 1. I would like to thank Euromoney for inviting me to speak at this 2nd Asia Sustainable and Responsible Capital Markets Forum today. It is indeed an honour to have this opportunity to talk about this important topic, especially here in Hong Kong, where we place a high priority on and direct much effort towards developing our sustainable finance platform. 2. I understand that we will have a very comprehensive programme today, covering not just the potential of sustainable finance in the region and the role of different stakeholders, but also exciting developments of green bonds and other innovative products. Allow me then to focus my remarks on the bigger picture and on three areas in particular: (i) First, the potential for sustainable finance in Asia; (ii) Second, Hong Kong’s role as Asia’s hub for sustainable finance; and (iii) Third, some of the Hong Kong Monetary Authority (HKMA)’s latest initiatives on this topic. Potential for sustainable finance in Asia 3. The effects of climate change are already visible around the world: more severe weather events, infrastructure damage, problems with food security, water resources, and even human health. No country or community is immune.
Puerto Rico’s real, or inflation-adjusted Gross National Product has declined for the past four years and this has been accompanied by a sharp decline in the real income of Island residents. According to a monthly index of economic activity produced by the Government Development Bank for Puerto Rico, economic activity began to decline as far back as 2005. Although the index has been stable for the past several months and this may be a signal that the economic downturn on the Island may have ended, a solid recovery has yet to take hold and conditions remain challenging. The job market remains a trouble spot for the Island’s economy. Total employment fell by about 13 percent or roughly 140,000 jobs, between its peak back in 2005 and mid-2010. This is nearly double the 7 percent job loss on the mainland. For the past two years, employment has appeared to have bottomed out, but there has been little evidence of recovery. The Island’s unemployment rate has fallen by more than a percentage point over the past year, but this is not necessarily good news. The fall was largely the result of a fall in labor force participation. At 14.8 percent the unemployment rate remains unacceptably high. High unemployment and low labor force participation remain perhaps the biggest challenges to the Puerto Rico economy. Even in relatively prosperous times, the unemployment rate on the Island has been more than double the rate on the mainland.

William C Dudley: The competitiveness of Puerto Rico’s economy – reducing the cost of doing business and improving labor market opportunities Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York and Chairman of the Committee on the Global Financial System (CGFS), before the Puerto Rico Chamber of Commerce Annual Convention, Fajardo, Puerto Rico, 29 June 2012. *  *  *  Good morning and greetings from New York City. I sincerely thank the Chamber for giving me the opportunity to address your annual meeting. Unfortunately I am unable to be in Puerto Rico in person, because I have a broken leg and am under doctor’s orders not to fly. The good news is that I am on the mend and that I have this opportunity to speak to you via video. We at the New York Fed are pleased that Puerto Rico is part of the Second Federal Reserve District that we represent in the Federal Reserve System. We are committed to the people of the Island and to its growth and prosperity. Our commitment is reflected in our ongoing work with our many partners on the Island. Last spring, with the Puerto Rico Chamber of Commerce and other local partners, we co-sponsored a forum aimed at helping small businesses in Puerto Rico learn about export opportunities. We have been involved with education on the Island for two decades, including by helping to set up the Alianza.
2  BIS central bankers’ speeches  Impact of deleveraging on Asia 13. Emerging Asia will not be immune to this synchronised deleveraging in the advanced Western economies. Fiscal consolidation and household deleveraging in the US and EU will have significant spillover effects on Asia, principally through the trade channel. Asia ex-Japan exports about a quarter of its goods to the US and Europe. Already, Asian export growth has decelerated from 25% at the beginning of 2011 to 10% in the last quarter of the year. 14. While Asian economies have started to restructure their economies towards increasing domestic demand, and intra-regional trade within Asia has been growing, these trends will, at best, cushion only part of the fall in demand from the West. Rebalancing of demand is a long-drawn process. It is unrealistic to expect Asia to become the main engine of growth for the global economy over the next few years. 15. The deleveraging of Eurozone banks will impact Asia mainly through the financial channel, in the form of tighter credit. Euro area banks as a whole provide 36% of global trade finance loans, and French and Spanish banks together account for more than two-fifths of trade finance loans in Asia. 16. To-date, the impact on Asia of deleveraging by Eurozone banks has been quite limited. Through most of last year, many Eurozone banks substituted the drying up of interbank funds in Asia with increased inflows from head office, which enabled them to continue funding activities in Asia.

Infrastructure finance is indeed promising, but has been promising for two decades now with little of the promise realised. There are a variety of country-specific risks – institutional and legal – that must be taken into account when operating in these markets. Managing risk and navigating a varied terrain are key to success. Singapore as the leading Asian asset management centre 37. This is where Singapore comes in. Singapore’s strong physical connectivity and trade and financial linkages with the rest of Asia make it a key node in the flow of information and ideas. It is an ideal vantage point for asset managers to understand Asia and manage pan-Asian investments. BIS central bankers’ speeches  5  38. The asset management industry in Singapore is broad based. Top-tier global funds have centralised a host of critical functions in Singapore, including portfolio management, investment research, trade execution, and product structuring – across both equities and fixed income asset classes. Singapore is also seeing a flourish of alternative investment managers specialising in strategies or asset classes that provide return streams uncorrelated to the broader market, or as the industry terms it, “generating alpha”. New initiatives to develop Singapore’s capital markets 39. A key component of the broader ecosystem that supports the asset management industry in Singapore is the capital market. Over the years, MAS has been making concerted efforts to broaden and deepen Singapore’s debt capital market.
It reflects the impact of the Job Support Scheme that shored up local employment; and the border control measures during the COVID-19 pandemic that made the employment of foreigners diﬀicult. Job growth in the financial sector has been consistently strong over the past 5 years A total of 21,000 net jobs were created during 2016-2020, with Singaporeans taking up about 16,000 or about 75% of these jobs. With more financial institutions setting up their regional and global hubs in Singapore today, 40% of financial sector jobs here are primarily international-facing. Half of these jobs are filled by Singaporeans. They include good jobs such as: application developers who develop digital products for overseas markets; private bankers who serve regional clients; and risk managers who monitor risk metrics for the regional or even global business. The employment outlook for the financial sector in 2021 remains positive. Late last year, MAS and the Institute of Banking and Finance (IBF) conducted a survey of financial institutions’ projected hiring from January to December 2021. Close to 800 financial institutions responded, representing about two-thirds of the financial services workforce. Financial institutions are oﬀering 6,500 newly created positions in 2021. These are new jobs created and do not take into account gross outflow of jobs. About 6,000 of the newly created positions are permanent jobs. Half of these jobs are in technology and consumer banking, with the remaining jobs spread across other business lines and functions.

Yet Hong Kong now finds itself with a consumer price level that is 12% below the peak of four years ago, and with a GDP deflator some 15% below its peak and 22% lower relative to that of the US than it was four years ago. What is the explanation, and can one live with this? There is general consensus, supported by both recent IMF analysis and research conducted within the HKMA, that Hong Kong's deflation is predominantly cyclical. I shall return to Hong Kong in a minute, but let me first dwell for a moment on the global slowdown in inflation. Over the past four years the rate of consumer price inflation has averaged 2.5% in the USA, only 1.7% in Euroland, minus 0.3% in Japan, and minus 0.3% in Mainland China. In six other economies of east and south-east Asia taken together, the inflation rate fell to 2.7% on average in these four years as 1 against 4.4% in the preceding four. This widespread slowdown in inflation, and in some cases the emergence of deflation, is not just a cyclical phenomenon. There are, I believe, some more fundamental institutional and structural factors which have been contributing. Underlying forces a. Successful central banks  First of these is the commitment of monetary authorities to combatting inflation and their evident success in doing so (or even over-achievement in some instances). With so many of them represented here today, I do not need to elaborate further. b.
The grey broken curve called “Low interest rate path without initial increase” shows an interest rate path with an unchanged repo rate in October and then a gradual increase up to around 2.7 per cent at the end of the forecast period, that is, the repo rate path advocated by Karolina Ekholm and myself at the monetary policy meeting in October. Figures 9c and 9d show with the same colours the corresponding forecasts for CPIF inflation and unemployment, all conditional on policy rates abroad according to market expectations. Figures 9c and 9d clearly show that the low repo rate path without initial increase provides the best outcome, with a CPIF forecast closest to the target and with the lowest unemployment forecast. This is also illustrated with the aid of the mean squared gaps in Figure 9b, in which this repo rate path results in a point corresponding to a lower mean squared gap for both the CPIF and unemployment. The mean squared gap for the unemployment gap is calculated on the basis of an equilibrium unemployment rate of 5.5 per cent. The low repo rate path dominates, even if the equilibrium unemployment rate is assumed to be as high as 6.5 per cent. Judging from this figure, an even lower repo rate path could provide an even better outcome for CPIF inflation and unemployment.

Norges Bank’s mandate reads as follows: Monetary policy shall be aimed at stability in the Norwegian krone’s internal and external value,  1  If clothing prices had risen at the same pace as other consumer prices, the overall saving for households is estimated at about NOK 10 billion in 2002. BIS Review 65/2002  3  contributing to stable expectations concerning exchange rate developments. At the same time, monetary policy shall underpin fiscal policy by contributing to stable developments in output and employment. Norges Bank’s implementation of monetary policy shall, in accordance with the first paragraph, be oriented towards low and stable inflation. The operational target of monetary policy shall be annual consumer price inflation of approximately 2.5 per cent over time. The first paragraph of the mandate sets forth its intentions. The last paragraph specifies what Norges Bank is required to do. The first sentence in the mandate refers to the value of the krone. Stability in the internal value of the krone implies that inflation must be low and stable. Low and stable inflation fosters economic growth and stability in financial and property markets. The regulation also states that monetary policy shall be aimed at stability in the external value of the krone. The krone exchange rate fluctuates from day to day, from week to week, and from month to month. We have free international trade and free capital movements. We do not have the instruments for fine-tuning the exchange rate.