samchain/econo-pairs-v1 huggingface dataset:
So inflation expectations play a key role for monetary policy and for that reason we keep a close eye on how they are developing.3 Perhaps the most important task of monetary policy is to influence inflation expectations since it is via market rates, and not the repo rate itself, that demand in the economy is affected. That is why communication and credibility are so significant. If we can get our message across we increase the chances of a successful monetary policy. Monetary policy in a low-inflation economy The Riksbank’s rule of action, which says that the policy rate should be adjusted when inflation is above or below target one to two years ahead, is not at all as mechanical as is sometimes perceived. The Executive Board’s clarification in 1999 made it clear that the practical formulation of monetary policy takes account of developments in the real economy. According to the clarification there may be reason for the Riksbank to deviate from the target if inflation is being affected by a temporary shock that will not fully dissipate during the coming two-year period but that is nonetheless not deemed to have any lasting influence on inflation developments. Another reason is when a bigger shock makes a return to the target one to two years ahead associated with excessive undesirable effects on the real economy. There are many examples in recent years of when we have taken such factors into account. At the turn of the year 2002-2003, for example, rising energy prices were pushing up inflation quickly.

And unemployment has continued to decline fairly steadily to just over 3% - its lowest rate for more than a quarter of a century. Now don't get me wrong. I'm not for a moment suggesting that we have finally reached the promised land. I'm very well aware that there are many people in this country - no doubt including many here tonight - for whom economic life is still pretty tough. My post bag never let's me forget that! For most of the time since I last spoke to you we have in particular been confronted with a very difficult international economic and financial environment. This began with the Asia crisis. But it was followed a couple of years later by a sharp economic slowdown, into mild recession, in the major industrial countries. And that was accompanied by a sustained fall in global equity markets from their "irrationally exuberant" peaks - aggravated and protracted by the threat of terrorism following 9/11 and by corporate governance and accounting failures in the United States. Most recently, of course, uncertainty surrounding the possibility of war with Iraq has weighed heavily on sentiment. All of this, together with the persistent weakness - until relatively recently - of the euro exchange rate, has made conditions intensely difficult for internationally-exposed business in the UK, including much of the manufacturing sector; and that, in turn, has been reflected not just in weak net external demand but also in declining business investment in this country and elsewhere in the industrial world.
Realised losses related to these investments have, as mentioned above, have been limited. The flipside of large book losses is that this portfolio has a high return, reflecting not only the increase in credit risk but also high liquidity premiums and fears and uncertainty in the market. The return, measured as the difference in the effective interest rate between the actual portfolio and the benchmark portfolio, is now close to two percentage points. History has seen a number of deep financial crises, and market conditions will return to normal in time. The final results of the management of the Fund’s fixed income portfolio since the beginning of the financial crisis cannot be deduced from the quarterly results while the crisis is at its peak. Values are not lost as long as borrowers fulfil their obligations. The Fund is prepared to retain ownership of a large volume of bond holdings until they mature in a few years. Moreover, unless the economic outlook goes from bad to considerably worse, the Fund will record a substantial excess return in the years ahead. Conclusion The Norwegian Pension Fund has been hard hit by the crisis. Norges Bank’s management results in 2008 were weak in both absolute and relative terms. Relative returns were significantly worse than might have been expected based on the investment strategy chosen. In the management of the fixed income portfolio, the crisis in the financial system revealed that risk exposure in the various mandates was not sufficiently independent.

I am informed that there is a resource person from Ghana who will be able to shed more light on this matter. In New Zealand, the development of the financial literacy strategy was led by the Retirement Commission which was mandated by a broader group at a symposium on financial literacy. There appears to have been no contestation by other regulators, possibly because there was high level involvement. The examples I have outlined above indicate how successful or otherwise the strategy development process can be. However, a common feature for successful strategy development among all the above processes is the multi-partner consultative process. Mr. Chairman, in recognising the critical role played by various stakeholders, the Bank of Zambia believes that a multi-partner stakeholder process is the most appropriate for Zambia, as it would enable greater mobilization of stakeholders and resources for the promotion of financial literacy in the country. The Bank of Zambia, will therefore, provide the initial leadership but it will be critical for all stakeholders to support, and buy-in into the strategy development process. Ladies and Gentlemen, the tremendous support of the various stakeholders to the agenda of the FSDP cannot go un-noticed. The technical and financial support provided by a number of our development partners including the Swedish Government, the Finnish Government, the World Bank, IMF, DFID, the United States Treasury and First Initiative, and now the Financial Education Fund have gone a long way in slowly making this vision a reality.
Second, there is little evidence that financial markets have in fact been particularly uncertain about the yield curve in the UK. Indeed, a survey of Goldman Sachs traders by their own economists showed that they thought, at longer horizons, interest rates were more predictable in the UK than in the euro area or United States.16 We are less predictable one month ahead for the very good reason, which I have explained before, that we are unable to pre-announce or signal the results of meetings the outcome of which may sometimes be unclear to MPC members themselves until well into the second day. Third, a key principle of our present arrangements is that decisions on Bank Rate are taken by majority vote of the members of the MPC. That is possible because they are voting on a single number – today’s Bank Rate. But there is no equivalent voting procedure which can map from individual views on an entire future path of interest rates to an overall path in a sensible manner.17 It might, or might not, be possible to find a consensus. But how would that square with making decisions on today’s rate by majority voting? The problem illustrates the important principle that communication cannot be divorced from the way decisions are made. Fourth, the Bank of England has tried extremely hard to ensure that forecasts are seen as probabilistic statements. The Bank of England has been publishing fan charts for inflation and output growth for more than a decade.

The impact of the crisis in the financial sector on the rest of the economy has been felt less acutely and a lot more slowly than could have been expected. It is precisely the continued robust global growth which is the main reason for the sharp rise in food and oil prices – although market speculation may have accentuated this trend. In most countries, the rise in the price of oil has translated into an increase in consumer prices. After remaining at a moderate level for a long time, inflation is again a cause for concern. This increase in the indices risks destabilising inflation expectations, which have remained very stable over the last number of years. Swiss economic outlook Last year saw the Swiss economy still operating at a dynamic pace, but there was a distinct fall-off during the first few months of 2008. In the first quarter, real GDP grew at an annualised rate of only 1.3%. This compares to growth rates in the region of 3% or even 4% which we saw in 2007. The slowdown is attributable to three major factors. First, the economy was turning over at an exceptionally high rate last year. A slowdown was therefore inevitable as much as it was desirable. It reduces the likelihood of the economy overheating and reflects the normalisation of monetary policy which we have undertaken in recent years. Second, the slowdown in exports played an added role, by curbing manufacturing activity.
Weak inflationary pressures and low 2 Over the period 1946-1971, this system, in practice, was very reminiscent of the gold standard, as many  countries had fixed exchange rates against the US dollar under the so-called Bretton Woods system and the United States had a link between the dollar and gold; see Jonung (2000). 3 See, for instance, Rogoff (1985). 4 It is difficult to obtain an overall picture of the actual development of the foreign currency reserves, as the Riksbank used different forward transactions as part of its management and these positions are not visible on the balance sheet. 3 [25]  resource utilisation led to interest rate cuts and vice versa. Even the reserve requirements that many other central banks around the world still use were set at zero way back in 1994, and have remained unchanged since then. Figure 1: Assets on the Riksbank’s balance sheet 1980-2019  Note. SEK billion. Annual data where the final observation is 2019. The broken line indicates corona-related measures. Source: The Riksbank  Figure 2: Liabilities on the Riksbank's balance sheet 1980-2019  Note. SEK billion. Annual data where the final observation is 2019. The broken line indicates corona-related measures. Source: The Riksbank  The communication when the inflation target was introduced was clear and successful – inflation expectations were gradually adapted down to the target of 2 per cent and wage formation functioned well when both employer and employee could assume that average inflation would be close to the target.

I believe there is a great likelihood that the low interest rate environment will be part of the monetary policy landscape for the foreseeable future and, given that it took almost 20 years to reach a decision on a new Sveriges Riksbank Act, the new proposal must be robust and able to cope with different conceivable developments going forward. One critical issue concerns the Riksbank's earnings. In this respect, there are two worrying trends. One is that demand for banknotes and coins is falling and the other is that the low level of interest rates is contributing to falling earnings for the Riksbank. If the real interest rate is around zero or even negative (as it has been for most of the last ten years), the proposed funding model will not work at all, as it is based on invested equity generating a positive real return. Consequently, a ‘backstop’ will be needed if this scenario is realised. In our response to the Inquiry, we propose an interest-free reserve requirement as an alternative form of funding for the Riksbank. 22 My assessment is that, in the future, we will presumably have to conduct monetary policy in a way that has great consequences for the balance sheet. The Inquiry's proposals certainly allow purchases of government bonds but, if the Riksbank needs a large balance sheet for monetary policy purposes, we will also have to consider the consequent loss risks and will therefore need a safety margin in our equity to secure satisfactory financial independence.
Yields on both indexed and non-indexed bonds have continued to fall this year, with the yield on government guaranteed indexed bonds now well below 5 percent which some had regarded as the floor. Although money and bond market yields declined in 1997 the lending rates of commercial and saving banks changed little. These rates have now begun to come down. Profitability of deposit institutions The profitability of banks improved during 1997. Current information on profits of the commercial banks shows a substantial increase compared with the preceding year. Their combined return on equity was 9.2% in 1997, compared with 8.2% in 1996 and 5% in the year before that. Nonetheless, profitability varied widely among them, and the different conditions that they faced complicate comparisons. Landsbanki (the National Bank) and Búnaðarbanki (the Agricultural Bank), for example, incurred large irregular expenses related to the final settlement of their pension obligations, which cannot be expected to recur in future. Provisions to reserves for loan losses have fallen sharply among all the banks. At the same time, the six largest savings banks recorded some decline in profitability compared with the previous year, and their return BIS Review 42/1998  -7-  on equity was 8.5%. I should underline, however, that profitability varied widely among individual savings banks.

The changes that the Central Bank implemented at the beginning of March concerning repurchase agreements had two components. On the one hand, the definition of the collateral that qualified for repurchase agreements was widened to include again, after an intermission, all market listed government guaranteed securities and central bank certificates of deposit. The purpose of this change is to level the positions of the various government securities, as varying positions in regard to liquidity transactions with the Central Bank can influence their relative market yields. It is clear that such limitations do not exist among Iceland’s neighbours. In addition, the stock of outstanding Treasury bills has shrunk in the recent period, which has caused a shortage of these bills for deposit banks to use in their repurchase agreements with the Central Bank. The other change is, as mentioned before, that the practice of offering repurchase agreements on tap has been abolished and replaced by a weekly auction of the agreements, as is done in many industrial countries. The Central Bank can at its discretion choose to auction reverse repurchase agreements instead of straightforward repurchase agreements. Neither of these changes alters the course of monetary policy. However, they did have the effect of reversing the rise in money market rates that had occurred in January and February, when the interbank rate rose to 8.3 percent because of the shortage of Treasury bills on the market.
We have also developed over the years and have been equipped with a broader and more in-depth surveillance that now covers household, financial, and real estate sectors. This is important for early detection of imbalances and enables preemptive policy action to prevent costly bursting of bubbles. Importantly, the process of monetary policy decision itself has been institutionalized, and independent from political influence. I therefore have no concern today whether who will become the next governor since a good system for policy decision making is already in place. Going forward, one of the important policy challenges facing us is the sizeable and volatile capital that flows to emerging economies, including Thailand. This is due to their better growth prospect and earlier policy normalization vis-à-vis G3 countries. Apart from the policy measure to try to shield ourselves from the adverse impact, the private sector also needs to remain vigilant about risk by not building up excessive risk exposure and by employing more risk protection tools as well. I turn now to the third part of my presentation that is what we can possibly do more to enhance Thailand’s resiliency over the medium term. On this issue, I would like to reiterate briefly what I said earlier in my annual statement regarding the urgency to elevate Thailand’s  BIS Review 94/2010  3  fundamental strength to cope with the changing structure of the global economy. Specifically, there are three issues that should be considered priorities.

2  BIS Review 94/2010  As for the banking system, we have built up sufficient bank capital, partly benefited from our prudent risk management. Our supervision developments have also come a long way. With intensive and continuous legal and regulatory reforms since the 1997 Asian crisis, our financial system is now resilient and in a good position to support growth. On this note, let me also say that the Bank of Thailand holds regular meetings with representatives from both Thai and Foreign Banks Associations, as well as meetings with their top management to discuss current issues and policy implications. This dialogue helps us to continuously strengthen risk management such that the financial system will remain in a strong position to serve the real economy efficiently. Third, thanks partly to export diversification over the years, Thai export is now recovering strongly despite a considerable shock to trades. A decade ago, Thailand relied mostly on G3 countries as our export market, but now, ASEAN market as well as BRIC (i.e., Brazil, Russia, India, and China) and other new destinations are emerging strongly and help diversify risk from the G3 countries. We also did not get much impact from the European debt crisis since our exports to PIIGS countries (i.e., Portugal, Ireland, Italy, Greece, and Spain) account for only 1.8 percent of total exports. Despite an impressive export growth now, Thailand needs to become more resilient against greater competition by an increasing number of emerging markets.
Chart 3: Occupational representation Per cent 100 80 60 40 20 0 1994  2019  White male  1994  2019  White female  1994  2019  Ethnic minority male  1994  2019  Ethnic minority female  Managers, professional and associates  Administrative  Skilled trade  Personal, sales and customer  Process and plant  Elementary  Source: ONS Labour Force Survey and Bank of England calculations. 7  All speeches are available online at www.bankofengland.co.uk/speeches  7  Chart 4 shows the composition of the UK labour market by sector. The vast majority of men across both ethnic sub-samples work in the ‘industry’ sector (including manufacturing, utilities and mining) and trade and transport sectors. The latter is particularly important for ethnic minority males, where close to 40% of this sub-group works. On the other hand, the public sector is dominated by females of both ethnicity backgrounds. The share of people working in professional services and finance is similar across the board. Chart 4: Sectoral representation Per cent 100  80  60  40  20  0 1994  2019  1994  White male Industry  2019  White female Public  1994  2019  Ethnic minority male  Trade and transport  Professional  1994  2019  Ethnic minority female Finance  Other  Source: ONS Labour Force Survey and Bank of England calculations. (b)  Pay Trends  Table 1 shows summary statistics of the distribution of earnings across gender and ethnicity.

4  All speeches are available online at www.bankofengland.co.uk/speeches  4  main advantages to using the LFS relative to other surveys, such as the British Household Panel Survey (BHPS) and the Annual Survey of Hours and Earnings (ASHE).7 First, the LFS has the longest time-series of pay and other work characteristics at a quarterly frequency in the UK. Using it allows us to track the evolution of pay gaps over time. Second, the LFS dataset offers a rich set of information on the characteristics of both workers and their jobs. These controls improve the robustness of the analysis, statistically, and the ability to explain movements in pay gaps behaviourally, using various individual and work-related characteristics. There have been a number of important changes in the employed LFS survey population over time. First, the share of ethnic minorities in the workforce has more than doubled, from 4% in 1994 to 10% in 2019. Second, the share of the population in higher education or with a degree has also increased significantly, from 22% to 43%. Third, the share of the population not born in the UK has almost tripled, from 6% in 1994 to 17% in 2019. These trends are representative of the composition of the UK population, as reported in the 2011 Census. (a)  Participation Trends  Female participation in the workforce has been on a broadly upward trend in the UK. Elsewhere across the G7, trends have been more disparate (Chart 1).
This growth projection and its composition are generally consistent with the baseline scenario of macroeconomic projections for Spain published by the Banco de España in mid-December and with those of most analysts (see left-hand panel of Chart 7). However, I would like to point out the two risks which I consider most significant for the macroeconomic scenario of the Budget. BANCO DE ESPAÑA  7	 TESTIMONY BY THE GOVERNOR OF THE BANCO DE ESPAÑA BEFORE PARLIAMENT IN RELATION TO THE DRAFT STATE AND SOCIAL SECURITY BUDGET FOR 2019  First, the macroeconomic projections of the Budget include an adjustment to the budget deficit clearly exceeding that expected by other analysts (see right-hand panel of Chart 7). In particular, the deficit target for general government as a whole stands at 1.3% of GDP in 2019, which is a reduction of 1.4 percentage points (pp) with respect to the envisaged final figure of 2.7% for 2018. By contrast, the projections of the Banco de España and of most analysts, as reflected by the Consensus Economics Forecasts, put the deficit for 2019 above 2%. Therefore, if the greater fiscal efforts required to meet the deficit target for general government as a whole included in the Draft Budget, amounting to 1.3% of GDP, were included in the projections of other analysts, their economic growth estimates for this year would be liable to a risk of downward revision.

Monetary policy can therefore not be oriented towards stabilising developments only in the internationally exposed sector, as has been advocated. This could easily create considerable imbalances in the Norwegian economy. The low interest rate policy and devaluations in the 1970s and 1980s are examples of how such a policy can fail. Monetary policy was geared towards preventing a deterioration of competitiveness in manufacturing. The krone was devalued on several occasions. But wage growth accelerated to compensate for higher inflation. The result was a wage and price spiral that hit the entire economy. At the same time, there was a sharp rise in the demand for loans, which created tensions in our financial system in the 1970s and in the 1980s. Monetary policy can be an effective means of influencing aggregate demand in the economy. However, there is little monetary policy can do to counter disturbances on the output side of the economy. Changes in wage formation, a decline in productivity growth or a sharp rise in prices for important factor inputs must instead be countered by measures to improve the way the economy functions. Fiscal policy places emphasis on smoothing fluctuations in the economy with a view to ensuring appropriate capacity utilisation and low unemployment. There is an overlap between the tasks that monetary policy and fiscal policy are intended to perform. This makes it natural to raise the issue of whether there is a need to coordinate fiscal and monetary policy decisions.