samchain/econo-pairs-v1 huggingface dataset:
However the distinguishing feature of this recession is that it is centred on the banking system, which is at the heart of the allocation of resources through the economy and of the transmission mechanism for monetary policy. It is no surprise therefore that both in this country and elsewhere interest rates have been supplemented by measures that have directly focussed on banking and financial markets. Credit is a critical lubricant in a modern economy. It can bridge the gap between expenditure and income. It supports investment: allowing households and companies to bring forward the purchase of expensive assets, which would otherwise require an extended period of saving. And it allows spending to be smoothed in the face of unexpected shocks to income. As credit became more scarce, the economy was bound to slow, amplifying the slowdown in the real economy that was already in train. A feedback loop started to gather momentum. 4  BIS Review 5/2009  The more the banks reined in lending, the worse the economic outlook became, and the greater spectre of rising credit losses on the banks’ loan portfolios, encouraging further cuts in lending. Policymakers had to intervene to cut this feedback, to prevent funding markets for banks and industry from freezing up, and to ensure that the banks have the capital, the funds and the confidence to continue lending.

While the transmission mechanism from official interest rates to the economy has been impaired by the dislocation of financial markets, the cuts in interest rates are still having an impact. While the reductions in the income of savers have offset to some extent the benefits to borrowers in the household sector, the net gain to the company sector is clear. The changes in interest rates have also accounted in part for the depreciation in the sterling exchange rate, which is down around a fifth in the past six months. No one who has lived through the 70s, 80s and early 90s will be complacent about a fall in sterling. But there is no doubt that an appreciable fall in the pound, such as we have seen, has been helpful both in supporting exports and import substitution in the short term and in encouraging the rebalancing of the economy that we need in the medium term. My second point is that it is important to distinguish the medium term from the short term goals. In the medium term we need to see a rebalancing of the economy in the UK, and some other countries, with a higher savings rates, less leverage in the financial sector, and higher net exports. However if everyone tries to increase saving and cut borrowing immediately we could prolong the downturn painfully. If everyone plans for the worst, we are more likely to get it.
This is reflected, for example, in the fact that the credit spreads, that is the difference between the interest rates on corporate bonds and the interest rates on government bonds, have returned to the levels that applied before Lehman Brothers filed for bankruptcy protection. The difference between interbank rates and the expected policy rate has also decreased (see Figure 15). The credit markets are also steadily improving. Companies that just a few months  BIS Review 105/2009  7  ago found it difficult to issue bonds now have access to the market again. Companies with a good credit rating can now borrow at a lower cost, at longer maturities and with lower collateral requirements than before the summer. It thus appears that the situation on the financial markets is beginning to ease and that confidence is slowly returning. This is in turn a precondition for the continuation of the recovery of the real economy. Global monetary and fiscal policy is still highly expansionary and there is plenty of spare capacity in most countries. It is not unreasonable to assume that a rapid recovery of the financial markets can also facilitate a more rapid recovery in the real economy. There are thus several reasons why it is reasonable to be cautiously optimistic. We must also remember, however, that we are still emerging from a severe recession and it may therefore take time before global demand recovers completely.

Only a year ago, the level of unemployment was approximately 5 per cent (see Figure 4). For several years, development in the Baltic states could be described as a fantastic success story with high economic growth. In the period 2005 to 2007, for example, economic growth in Estonia and Latvia was approximately 10 per cent per year, while development in Lithuania was more moderate. At the same time, however, major domestic imbalances developed which laid the foundations for the crisis we are witnessing today. When the Baltic states moved from being regulated economies to market economies, optimism about the future was high and both household consumption and private sector investment increased dramatically. However, the investments went to the service and property sectors instead of to developing production capacity in the industrial sector. Export development was thus weak while imports increased rapidly as a result of strong domestic demand. Consequently, the current account deficits of the Baltic states increased (see Figure 4). The deficits were largely funded by taking loans in euro, mainly from Swedish and other foreign banks. The high level of economic growth led to the overheating of the labour market and wages and inflation increased (see Figure 6). In Latvia, for example, nominal wages in  3  Swedbank's market shares in the second quarter of thiss year amounted to 43 per cent in Estonia, 25 per cent in Latvia and 22 per cent in Lithuania.
The public authorities at home were committed to supporting the domestic economic development by pursuing stimulus fiscal and monetary policies. In the banking sector, the global financial crisis appeared mainly with the contracted paces of lending to the economy. Throughout this period, the Bank of Albania has aimed at preventing the deepening of the impact of this crisis by conducting an ease monetary policy and supplying the interbank market with necessary liquidity. During 2009 and 2010, the Bank of Albania lowered the key interest rate by 1.25 percentage points, to 5%. Also, during the major part of 2009, the banks benefited unlimited liquidity, at an interest rate equal to the key policy rate. In the meantime, before the impact of the crisis, through special regulatory acts initiated  BIS central bankers’ speeches  1  since 2006, the Bank of Albania has aimed at limiting some risks arising from banking activity, such as rapid and foreign-currency lending, by setting higher capital requirements for more exposed banks. Throughout this period, we have communicated regularly with the public at large, businesses and banking industry, to explain our actions and discuss the challenges posed to economic actors. We believe that as a result of these actions taken by public authorities and the cooperation with the financial industry, the banking sector has successfully withstood the impact of the global financial crises, remaining sustainable and maintaining positive indicators of financial intermediation.

Thus, during 2010, the banking sector credit growth, albeit lower than in the pre-crisis period, was considerable, around 9%, while in some Central and South-Eastern European countries, it was negative. The deceleration of credit growth, which was initially driven by supply-side factors, is mostly a phenomenon attributed to the decline in the demand for loans. As a consequence of weaker expectations for activity development, businesses decreased their production capacity utilization, lowering investment objectives and the demand for loan. In spite of weathering the direct impact of the crisis, important challenges lay ahead of the banking sector and the Bank of Albania. First, the performance of credit quality should be monitored prudentially, aiming to timely identify non-performing loans, assess them correctly according to possibilities of their repayment and pursue proper policies, in order to recover the loan value within an appropriate time. Second, during this phase, it is necessary to strengthen the banks’ internal audit systems, not only related to credit risk but also to provide a higher standard of management. Third, banks should assess their expectations about the performance of their activity and take measures to strengthen their capital position in advance, in case of need. The Bank of Albania deems that in the periods ahead the Albanian banking sector and the economy need to determine and pursue more suitable development policies, which should include: setting realistic development objectives; setting more competitive prices for banking products and services; and increasing lending in the national currency.
Between 2010 and 2013 Greece, Ireland, Portugal and Cyprus requested financial assistance from the EU and the IMF. These programmes involved far-reaching economic and financial policy adjustments. Other countries that had been hit by a confidence crisis, such as Spain and Italy, chose to undertake similar corrections. Spain also requested ESM programme for its financial sector. As a result, structural fiscal balances (i.e. fiscal balances excluding the impact of the cycle and one-off costs) improved significantly in all these countries. From 2010 to 2013 this improvement was equal to about 15 percentage points in Greece, 6.5 percentage points in Portugal, 6.0 percentage points in Spain, 5.5 percentage points in Ireland and 4.0 percentage points in Italy. Some of these adjustments are unparalleled in scale from a historical perspective. These fiscal corrections took place at a time when confidence had reached its lowest level, private sector saving ratios were sharply increasing, banks had to deleverage and access to finance by firms and households was impaired. The short-term costs in economic and social terms were therefore high. Yet, those costs were also elevated by the fact that most of the stressed countries had entered the crisis with rigid institutions and economic structures. As a consequence, the necessary adjustment of prices and costs to restore competitiveness was slow, which exacerbated the negative impact on activity. Nominal rigidities increased the real cost of the adjustment and the burden has often been borne by the more vulnerable members of society. A key complement to fiscal adjustment has therefore been structural reform.

This is the best way to ensure sustainable market access supported by a robust growth outlook. Recent empirical estimates based on the distance-to-frontier approach show the gains that could still be achieved. In Portugal, closing the gap from best practices via a fast implementation of product, labour and welfare state reforms would lead to an increase in percapita GDP by 13.5% in 10 years.2 In these projections, not only the pace of implementation matters, but also the degree of ambitiousness. If reforms target only a partial closure of the gap vis-à-vis the best performers then of course the GDP gains will also be reduced. All this points to the need to establish a clear link between notional reforms and actual outcomes via an outcome-based accountability framework, which can increase or make more effective the implementation process. The need for structural reforms in all euro area countries Despite difficulties, the impetus for reform has been strong in the stressed countries, while it has been much weaker in the rest of the euro area. This is the natural outcome of a crisisdriven reform process. However, the crisis has clearly shown that a strategy of postponing reforms is self-defeating, as it contributed to the accumulation of imbalances and vulnerabilities in good times and increased the cost of adjustment in bad times. It is therefore crucial that the reform process is strengthened in all euro area countries, also those not affected by the crisis.
As became evident in the previous crisis, financial fragmentation problems will adversely affect not only the economic development of countries penalised in the financial markets, but also that of the EU as a whole. Therefore, joint action enabling the crisis to be tackled on comparable terms by all European countries will help shorten its duration and protect the productive system for each and every one of the countries in the area. This is also essential to ensure a uniform and robust recovery. 1  Such common action is particularly justified against the backdrop of this crisis, whose origin is a fully exogenous shock that is not related to the existence of prior macroeconomic imbalances. To some extent, this asymmetric impact is the result of the pattern of productive specialisation among countries, itself a product of the workings of the single market. In this regard, protecting the single market also means preventing excessive economic disparity among the members. These arguments justify the forceful response given by the area’s economic authorities, at national and European scale, in the face of the economic challenge deriving from the pandemic. Another particularly important and positive aspect has been the high degree of coordination (in many cases implicit, albeit effective) between the different policies and decision-making spheres at global, European and national level. I will now briefly describe this response in the fields of monetary, prudential and fiscal policy.

Mohd Razif bin Abd Kadir: The life insurance industry in Malaysia Speech by Mr Mohd Razif bin Abd Kadir, Deputy Governor of the Central Bank of Malaysia, at the Launch of Tokio Marine-Asia Life Group, Kuala Lumpur, 9 March 2007. *  *  *  Mr. Kunio Ishihara, President of Tokio Marine, Mr. Morio Ishii, Vice-President of Tokio Marine, Members of the Senior Management of Tokio Marine Asia Pte. Ltd and Asia General Holdings, Mr. Ng Chek Khiang, Chief Executive Officer of Asia Life (M) Berhad, Distinguished Guests, Ladies and gentlemen, It is a pleasure to be here with you this evening to celebrate the official launch of TM Asia Life Malaysia Bhd.. An alliance of this nature is certainly a happy event, especially when it reflects the positive transformation that is shaping the insurance industry in Malaysia. TM Asia Life combines the strengths of the one of the world’s largest Japanese insurance groups and an established life insurer in the Malaysian market that has provided over 50 years of trusted service to Malaysians. It also marks the establishment of the first Japanese-owned life insurance company in Malaysia, adding further diversity to the profile of foreign insurers in our market. When developments like this take place in the industry, we look forward to new innovations, fresh management perspectives and a renewed energy that will take the industry to the next level of development.
For a long time the inflation target was expressed in terms of the Consumer Price Index (the CPI), but since 2017, it has been expressed in terms of the CPI with a fixed interest rate (the CPIF). In the CPIF the direct effects of changes in mortgage rate have been excluded. 1 2 The following description of the concept of inflation can be found on the Riksbank’s website: If prices of some individual goods or services rise, this is not inflation. Prices of individual goods and services can rise because, for instance, it is more difficult to get hold of them. For instance, the price of oil may rise as oil reserves diminish. Such price increases are usually called relative price increases and are thus not inflation. For inflation to exist there should be an increase in the general price level, that is, prices in general should rise. And if one is to call it inflation, the price increase should be lasting. If, for instance, the government raises VAT, this has a one-off effect on the general price level, but does not lead to prices continuing to rise. The CPI is calculated every month by Statistics Sweden (SCB) and is intended to measure the changes in an average Swedish household’s living expenses. The measure is an aggregate of prices of a number of different goods and services. The aggregate is based on how large the proportion of each product or service is in relation to an average household’s total consumption costs.

The new method, where one follows the prices on a top list for books sold, probably gives greater variations than the old method where one followed the prices on a number of indicator books. The top list changes every month, while the indicator list changed less often. Sales are now captured to a greater extent than before. 27 Foreign air travel was not included in Table 1, but a new method of measuring prices has contributed to a new seasonal pattern with a higher volatility in recent years. 14 [19]  Underlying measures and actual monetary policy The different measures of underlying inflation give us the opportunity to approach the existing data and view it from different angles. But in the next step, the measures will be used by policymakers responsible for monetary policy. Here a conflict arises between on the one hand bringing forward various underlying measures and on the other hand being clear and transparent about the objective of monetary policy. The conflict become particularly clear if one chooses to use measures of underlying inflation that systematically deviate from the actual rate of inflation. Or, in other words, the poorer the measure of underlying measure of inflation, the greater the communication challenges. I would say that we have seen clear examples of this conflict in recent years: In June 2018, analysts at Handelsbanken Capital Markets considered it necessary to deny that the Riksbank had changed its target variable in a newsletter.
The flip side of digital assets are, however, their inherent risks which, as just demonstrated by the collapse of FTX, can have far-reaching implications for their very markets and, eventually, spill over to the regulated financial system through various types of exposures for conventional players. Hence, authorities need to develop and deploy swift and appropriate regulatory responses, of which, I think, MiCA is a telling example. The European Union's Regulation on Markets in Crypto-assets, on which we have acted as one of the advisors to the Spanish Treasury, lays down a set of common rules applicable to both crypto-asset issuers and service providers with a view to providing crypto-asset users with legal certainty and adequate legal protection. In the same way as we deal with banks, MiCA foresees an ex-ante authorisation of the new types of crypto-asset service providers. Moreover, it sets out a number of prudential, organisational and transparency requirements, as well as others relating to the safekeeping of client funds, conflicts of interest and outsourcing. With regard to their issuance and offering, MiCA introduces rules on both the authorisation of the respective players and on how to draft the "white paper" that should reflect all the necessary and accurate information future investors may require. MiCA leaves outside its scope non-fungible crypto-assets. Furthermore, it does not apply to crypto-assets that may be classed as financial instruments. The latter will still be governed by the existing legislation on financial services.

The combination of a lot of money to be invested and low risk-free interest rates contributed to an increase in the demand for assets that were profitable to invest in and led to an intensified hunt for high yield. This type of environment often inspires great inventiveness in the financial markets and many new financial instruments were also created. These were often complex and difficult to valuate correctly. But in the optimistic climate prevailing then – everything had gone so well for so long – it was nevertheless easy to sell them. Those who invested in the new instruments disregarded, or failed to sufficiently understand, the risks that were “inbuilt” in them. The financial supervisory authorities and regulations also lagged behind this development. The problems in the international financial markets began to become more apparent as early as summer 2007. But the Swedish economy and the Swedish financial markets long appeared able to manage fairly well, despite the fact that the turbulence was having more and more effects on the world around us. Of course, economic activity in Sweden began to weaken as international economic activity declined, but this did not initially seem to entail any very serious downturn. However, when Lehman Brothers filed for bankruptcy in September  BIS Review 73/2009  1  2008 the situation worsened dramatically. The confidence that had existed between financial institutions was shaken to its foundations when no one was certain who might be next in line to default on their payments.
Ladies and Gentlemen, the 2005 Finscope Survey undertaken by Finmark Trust confirmed that levels of access to financial services in Zambia are extremely low. Fewer than 15% of adult Zambians are reported to have had access to commercial banks. Of the 15%, the majority were men. Therefore more needs to be done to enable women have increased access to financial services. This is why one of the strategic objectives of the Bank of Zambia in its 2008-2011 Strategic Plan is to promote financial inclusion. The more financial services are extended to ordinary citizens and small business enterprises, the more there will be a greater proportion of women amongst those receiving these services. We should note that it is women who have special needs in terms of access to financial services. In small businesses, such as small scale farming and market trading, it is very important to have a safe place to save money, maintain working capital and also access loan facilities. Ladies and Gentlemen, as we discuss financing for gender equality, there are fundamental questions we need to ask ourselves such as: •  Are services available from a financial service provider more to the advantage of men, rather than women? •  Are men’s interests served more than women’s? •  Do financial service providers enable women to overcome discrimination against them in their economic life? I believe these questions will be answered positively by the institutions present here.

Simultaneously, we have prolonged the maturity span of injecting operations to smooth down the upward slope of interest rate curve and we have expanded the base of eligible collateral to facilitate the access of financial institution in liquid funds. These operations of the Bank of Albania have helped control on interest rate level. Bank of Albania’s intervention has been more effective in controlling the short-term interest rates. The long-term interest rates of Government securities and loans revealed rising tendencies, owing to the Government’s demand for financing and the increased sensitiveness of the banking system towards liquidity indicators. In parallel, the depreciating exchange rate trends have complemented the easier monetary conditions framework, providing advantage to exports and trade deficit improvement. However, as we have constantly underscored in our statements, the Bank of Albania has been attentive to managing the momentary stimulus, aiming above all the achievement of its target for maintaining the macroeconomic stability, by preserving internal and external balances. Annual inflation in the first semester 2009 was 2.0 percent, recording a fall compared to inflation rates of the last year, but remaining within the Bank of Albania’s targeted band. Low inflation rates over the first semester of the current year are due to the weakening of inflationary pressures on the demand and supply side, consequent to raw materials price cut in the international market and the economic activity slowdown at home.