samchain/econo-pairs-v1 huggingface dataset:
I have myself been the governor of the independent Banque de France during these ten years. The independence was granted in January 1994, five years before the euro. During these five years I was particularly proud that our primary goal, price stability, was reached in line with our definition – below 2% – and was fully compatible with price stability in Germany during the same five-year period. It can be said that, with the creation of the euro, the stability culture has been “Europeanised” and given the legal face of an international treaty European stability consensus The primary mandate of price stability and the independence of central banks as laid down in the Maastricht Treaty, are an expression of a stability consensus which has grown in Europe – even worldwide – in recent decades. There exists today a general awareness of the fact that stable prices are indeed a fundamental condition for sustainable economic growth and employment. The priority for price stability as the primary objective of monetary policy as well as the independence of the ECB enjoy broad support from the people of Europe. In surveys of citizens throughout the euro area, an overwhelming majority regard price stability as an important goal. An overwhelming majority believe it important that the ECB and the Eurosystem are independent of governments in order to achieve this goal. This support from our fellow citizens in the Euro area matters greatly to the ECB.

The equation of the post-crisis Phillips Curve is written as follows: [𝛱𝑔𝑎𝑝 𝑇𝑛 ]𝑁 = 𝑓([𝑐𝑊𝑔𝑎𝑝 𝑇𝑛 ]𝑁 ) + [𝜀𝑇𝑛 ]𝑁 4  By introducing the equations for inflation gap and cumulative real wage gap into relation (18), the post-crisis Phillips Curve becomes: [𝛱𝑇𝑛 − 𝛱𝑇∗𝑛 ]𝑁 = 𝑓([∑𝑁 𝑛=1(𝑊𝑇𝑛 − 𝑊𝑇0 )]𝑁 ) + [𝜀𝑇𝑛 ]𝑁 where N is the period of time for which the Phillips Curve is evaluated and 𝜀𝑇𝑛 is the residual, which accounts for other variables influencing the inflation gap. At time T0, cumulative real wage gap is considered zero, while inflation gap is considered positive. This is one of the reasons why the curve does not cross exactly at the intersection of the two axes. The other reason relates to the dynamic (non-stationary) feature of the curve, expressing its different expected coefficients during different time periods. The shape of the post-crisis Phillips Curve expresses the theoretical assumption that the inflation rate stays below its target until the cumulative real wage gap closes, and that it increases above its target when the cumulative real wage gap becomes positive. The graphical representation assumes different slopes before and after closing the cumulative real wage gap. A sharper slope after closing the cumulative real wage gap means that the same amount of a cumulative real wage gap leads to less inflation as the cumulative gap is negative, and to more inflation as the cumulative gap turns positive.
Many debt contracts feature floating interest rates; that is, the interest rate on the debt is modified periodically to reflect prevailing market interest rates. But when the contractual language does not contemplate the possibility of negative rates, complications will ensue. In that event, the parties must renegotiate, which is difficult when the parties are highly dispersed, and adjust the contractual language to address what happens when market rates are negative. Another first-order operational problem is how to collect interest from creditors: often debtors have few means of calculating interest payments due from creditors, few easy ways to collect the payment, and a limited ability to enforce negative interest payments from creditors. Given these realities, designing interest-bearing securities at negative yields will require careful planning. This topic alone is worthy of a longer treatment. In fact, my colleague Ken Garbade and I wrote a piece on this topic, and I won’t repeat the many considerations that enter into the design of securities at negative rates. 5 I will point out that because it is so challenging to develop a practical way to collect periodic interest payments directly from holders, one possible work-around is for the issuer of a fixed-rate bond to set the coupon rate to zero, making the bond a single-payment security, and to sell the bond at a premium to its principal value.

In fact, reflecting the complexity and  2/6  BIS - Central bankers' speeches  exhaustiveness of this text, it is now heading for a February slot before the European Parliament, which is expected to give its final endorsement. From then on the clock will start ticking on what will most likely be a profound game changer for this industry. Contributing to shaping the regulatory framework, as we have done with MiCA, is probably the most straightforward way to deal with new developments. Nevertheless, it may not be enough to avoid certain undesired effects, and crypo-assets are a good example in this regard. Let us imagine what would happen if stablecoins denominated in a currency other than the official one were extensively used. They may not pose risks to the financial system, if properly regulated and supervised, but this situation could introduce fragmentation, undermine the role of central bank money as monetary anchor, and, ultimately, bring instability and hinder monetary sovereignty. Therefore, central banks need to stand ready to take additional measures, if needed, which leads me to the second part of my address. The Eurosystem experience in developing and providing a digital euro One of the additional measures that could be adopted to respond to the challenges raised by financial innovation is the development of a retail Central Bank Digital Currency (CBDC).
The U.S. will fall short of March forecasts, due to the slow recovery of its labor market, a real-estate sector that is still unable to leave the subprime crisis behind, a household deleveraging process that continues its course, and little additional room to apply any measures to boost growth. But, compared to March, the biggest difference in terms of world growth lies in the emerging world. In contrast with 2011, the main emerging economies have lost dynamism. Some indicators for China suggest that the decline in its growth rate will be sharper than forecast in March. This has prompted the adoption of more expansionary fiscal and monetary policies, and India has followed suit. The rest of emerging Asia is feeling the effects of lower growth in China, the U.S. and Europe in its exports and its manufacturing industry. In Latin America, although there is more heterogeneity, the poor performance of Brazil in the first quarter stands out. Other economies, like Mexico, Peru, Colombia and Chile remain strong, sustained by their domestic demands. This world scenario of weaker economies and reduced inflationary pressures due to the lower oil price has triggered a relaxation of monetary policies of several emerging economies. The baseline scenario forecasts that Chile’s trading partners will grow 3.6 and 3.9 percent in 2012 and 2013, respectively, a little less than was foreseen in the previous Monetary Policy Report. This will also result in lower prices for copper and oil than were expected in March.

Let me share with you some thoughts about what I have perceived at the meetings I have held in recent months with monetary authorities around the world. The central bank governors of developed economies, plus some from emerging markets, get together once every two months to share our views on the global economic and financial situation. Two things have called my attention in the three meetings I have attended since I assumed as the governor of the CBC. On the one hand, the severity and gravity of the situation of some developed countries. Being so distant geographically from the main financial centers of the world, in Chile we often fail to grasp in full dimension the hardships facing some economies that interact with us. These meetings allow us to see firsthand these situations and feel their true magnitude. On the other, I am amazed by the high prestige that the Chilean economy enjoys in these same arenas. It is clearly set apart from others, because of its strength, its sound macroeconomic administration and the efficacy of its institutions. Of course this makes us confident as it gives us more and better tools to confront possible shocks coming from abroad. Our responsibility is twofold. On the one hand, is to keep inflation low and stable, to help in achieving sustainable growth. On the other hand, is to contribute with our powers to identify and address the risks threatening the normal functioning of our financial system.
Bond yields reversed their movements from the early part of the pandemic, with 10 year US treasury yields rising by 65 bps in this period and 10 year gilt yields moving 64 bps higher. Bid-offer spreads on US treasuries widened by a factor of 10. The gold price fell by 12%. Investors suddenly looked to redeem from money market funds (MMFs). Sterling MMFs saw outflows of 11% in just over a week. Similar outflows were seen in the US prime MMFs. This self-reinforcing dynamic was broken by massive central bank intervention. On 19 March, the Monetary Policy Committee (MPC) announced the stock of asset purchases would increase by £ of gilts. We also launched special repo operations (the Contingent Term Repo Facility), a 1/6  BIS central bankers' speeches  credit scheme (the Covid Corporate Financing Facility), extended term credit to banks (the Term Funding Scheme with additional incentives for SMEs) and joined other major central banks in activating the swaplines. In the US, amongst other actions, the Federal Reserve announced a $ asset purchase program, quintupled its repo operations (from $ to $ and established a temporary repo facility for international authorities with a view to support treasury market functioning. In Europe, the Pandemic Emergency Purchase Programme was put in place to purchases eligible assets up to € As a result, order returned to financial markets and subsequently the growing realisation that governments would step in to limit economic damage further restored confidence. What lesson should we learn from that episode?

This is part of the broader issue that I noted at the outset about the ability of non-bank finance to insure against severe but plausible liquidity stress. It is an issue that the FSB should take forward as part of its work programme on enhancing liquidity resilience in the NBFI sector. Prompt and transparent margining and, where possible, central clearing are essential to the resilience of the financial system. In times of stress, margin requirements will increase – as I said earlier that is a feature of the system, not a bug. But at the same time we need to do everything possible to ensure that the impact is not unnecessarily pro-cyclical, that market participants have the tools to prepare and manage that impact and that they do so. The March 2020 ‘dash for cash’ has given us a valuable lesson, we should not waste it. 1 Ben Bernanke has pointed out that panics can be a major cause of credit crunches. Reforms that avoid such  panic reduce the likelihood that financial stress transmits to real economy stress. 2 FSB (2017) Report on effectiveness of derivatives reforms. 6/6  BIS central bankers' speeches
4  BIS Review 124/2007

As discussant for today’s lecture, we are privileged to have Dato Dr Zeti Akhtar Aziz, who has been Governor of Bank Negara Malaysia since May last year, and who is another one of the ‘classmates’ at BIS. I have known Dr Zeti for some years now and benefited from her wise counsel, particularly during the time when she was Assistant Governor in charge of economic research. Dr Zeti is a career central  BIS Review 13/2001  1  banker who joined Bank Negara in 1985 and who has taken up various important positions within Bank Negara. She played a pivotal role in steering, very successfully, Malaysia through the Asian Financial Crisis and in introducing the very important financial sector reforms. Dr Zeti is therefore able to offer a particularly practical perspective on today’s theme, and I look forward to her comments with much interest. Ladies and Gentlemen, I now have great pleasure in calling upon our speaker, Mr Andrew Crockett, to deliver the fourth HKMA Distinguished Lecture. Mr Crockett, please. 2  BIS Review 13/2001
It is my pleasure and honour to be invited to deliver today’s keynote address, to share my views on the importance of ethical conduct in upholding the trust of financial consumers in the quality of financial services and advice offered by financial practitioners. Alleviating the Impact of COVID-19 The wide-reaching impact from efforts to contain COVID-19 has exposed long-standing fault lines and gaps in financial management among households and businesses. While essential for the protection of lives, the impact of global and national containment strategies in the form of mass or targeted lock-downs have inadvertently impacted the livelihoods of many segments of society. These lock-downs have been gradually uplifted and are temporary in nature, but for consumers who lack adequate financial safety nets, the after-effects are real and significant. In line with our intent of providing financial reprieve to those adversely affected by this pandemic, 1/3  BIS central bankers' speeches  Bank Negara Malaysia has worked tirelessly with the banking industry to provide loan moratoriums and targeted repayment assistance to individuals and entrepreneurs who have lost their jobs or whose earnings have been adversely impacted. Similarly, we have also worked with the insurance and takaful operators to implement premium and contribution deferments from 1 April 2020 until the end of this year, to ensure policyholders and takaful participants who face temporary financial constraints can preserve essential coverage during these unprecedented times.

FEN leverages its members’ expertise and resources to coordinate, co-operate, and collectively drive efforts to promote effective delivery of financial education initiatives to Malaysians under the National Strategy for Financial Literacy (2019 – 2023). 3/3  BIS central bankers' speeches
4  BIS Review 113/2009  To begin this discussion, I should emphasize that capital inflows to capital-scarce economies are a good thing. We know that capital flows to institutionally strong economies are beneficial (Prasad et al., 2002). Therefore, the role of policy is not to impede capital flows, but to avoid the creation of a bubble in domestic assets with consequences on resource allocation. 5 In this regard, to have in place sound prudential regulation during periods of abundance of capital is essential for financial stability, as we are reminded by the crisis in Chile in the early 1980s, the Mexican crisis of the mid-1990s, the Asian crisis, and more recently, the crisis in Eastern Europe. Even if one could accept that monetary tightening could be an appropriate response to combat an asset price bubble such as the recent housing price bubble, with all the caveats I discussed before, the problem is more acute in small open economies. Tightening monetary policy may have perverse effects, since it induces further capital inflows and strengthens the currency. In this case, the interest rate is not the most adequate instrument with which to burst the bubble.

All the institutions involved in our payment system are devoting increasing resources to prevent cyberattacks, from banks and Norges Bank to our security authorities. However, we can never be completely certain that the system will be able to resist all possible attacks. We can lose money too. Ultimately, there may come a time when our systems have to be shut down for a period. We need to be prepared for a situation where the payment system – or parts of it – has to be shut down for a period. Contingency arrangements must provide protection against a wide range of incidents, not just cyberattacks. These arrangements primarily comprise a number of reserve solutions in our electronic systems. Our ultimate contingency and reserve solution is our banknotes and coins. This part of our contingency arrangements must be strengthened. On the advice of Norges Bank and Finanstilsynet (Financial Supervisory Authority of Norway), the Ministry of Finance recently circulated a consultation paper proposing a regulation to ensure the availability of cash in a contingency. What should the future form of money be? The role of banknotes and coins, which have been our central bank money since Norges Bank was founded a little more than 200 years ago, continues to diminish. Everyday payments are increasingly made using deposit money in bank accounts. New forms of payment are a new stage of this trend. This prompts the following question: what should the future form of money be?
Would it be remunerated or not and how appealing should any remuneration be versus commercial bank money held on deposit accounts? Would we apply limits or restrictions on its use to control demand in normal times or in stress? How and to what extent should data and privacy be protected? And crucially, running though all of these design questions of the question where the public/private boundary lie; which functions and services should be provided by the central bank and which by the private sector? These are profound questions and choices that would inform any decision to launch a CBDC. We certainly do not have the answers today. We should however recognise a couple of realities. First, that the form of money has always been evolving and that technology and consequent changes in the way we want to live and transact with each other are now driving rapid change in money and payments. We cannot hold that back. We need to think about and debate these issues now. And in thinking about CBDC, we should think about the role it could play in the future and how money and payments might evolve in its absence. Second, changes in the form of money have implications that go wider than finance and economics. We should recognise there are questions about privacy, competition, inclusion, the role of the public sector and other broader societal issues. These will require the engagement of the political authorities and will need broader debate.

Stablecoins however pose potential risks that go beyond those usually associated with existing payment systems because they also create new money-like instruments for transactional purposes and which people would hold as a store of value in the way they hold central bank or commercial bank money. Applying the principle of same risk same regulation, we therefore need to ensure that, where stablecoins are used in systemic payment chains as money-like instruments, they meet standards equivalent to those expected of commercial bank money in relation to stability of value, robustness of legal claim and the ability to redeem at par in fiat. Stablecoin proposals raise broader regulatory issues, e.g. for competition, data protection, anti-money laundering and counter terrorist financing. These are for other authorities and I won’t go into them here, but the principle of same risk same regulation applies with equal force. We also need to look at the possible wider dynamic effects of stablecoin systems should they grow to a systemic size – and in particular the impact on monetary and financial stability and on the function of credit intermediation and money creation in the economy. It is difficult to predict how behaviour would evolve.
Let me now conclude by stressing that, in this context in which a homogenous framework and experience in the use of macroprudential tools is lacking, having  5  For international attempts to follow a cross-sectoral approach on residential mortgage underwriting see, however, the FSB Principles for Sound Residential Mortgage Underwriting Practices (April 2012), the FSB Thematic Review of Mortgage Underwriting and Origination Practices (March 2011) and the Joint Forum Review of the Differentiated Nature and Scope of Financial Regulation – Chapter 3 on Mortgage Origination – (January 2010). 10/11  adequate communication is crucial. From my point of view, this is a critical element of the whole process. Even before that, macroprudential policy-makers must be very careful to prevent the identification of risks from becoming a selffulfilling prophecy. And when deciding to activate any tool, it is necessary to convince stakeholders with arguments and evidence that, even if there are apparent short-term costs, the medium and long-term benefits are clearly greater. Obviously, this implies an in-depth ex-ante impact assessment analysis including all the different options and a general equilibrium approach, and also an ex-post impact assessment analysis to test the efficiency of the selected tools. And now, let me give the floor to our first keynote speaker, Agustín Carstens, who we all know so well. Dr. Carstens is currently General Manager of the BIS, but in the past he was governor of the Bank of Mexico, vice minister of finance also in Mexico and vice president of the IMF.

This is a strengthening compared to the earlier agreement among the euro area countries, changing the requirement from targeting the cyclically adjusted deficit to targeting an improvement in the structural deficit. When deciding the adjustment path, public investment and structural reforms can be taken into account. If structural reforms are to be taken into account, they should have a large and proven positive effect on the economy and there should be a safety margin to the 3% deficit floor. My view is that there is a possibility to use the newly defined MTOs in a wise manner, more closely adapted to the situation of the individual country. However, the scope for interpretation is so large that there is a high risk of lax and uneven implementation. The experiences of the first year indicate that some member states have more ambitious MTOs than required by the Pact. This is often countries with their own national budgetary rules, such as Sweden, which comprise MTOs. At the same time,  2  BIS Review 88/2006  there are other member states who need to do more to achieve their MTOs. The measures are often postponed too far ahead and are not sufficiently explicit and concrete. Changes in the corrective arm The third part of the changes refers to what happens when a country has an excessive deficit. As before, exemptions can be granted if the country is suffering from a severe economic downturn that it could not foresee, so called exceptional circumstances.