samchain/econo-pairs-v1 huggingface dataset:
We have also continued to supply the banking system with the required liquidity to support the public and private sectors’ activity. In parallel, our communication with the public has aimed at guaranteeing the economic agents and financial markets on maintaining of an easing monetary policy in the future. Overall, our monetary policy has been successful in preserving macroeconomic balances; however, its effect on stimulating the economy has been more limited. The financial market and the banking system have not fully reflected the key interest rate cuts in their main products – loans, deposits and Government securities – while the Albanian consumers and businesses have slightly responded to monetary stimulus and lower interest rates. To our opinion, this performance reflects two core problems that our economy and macroeconomic policies are facing: These two problems are: the first is the structural vulnerability of the Albanian economy, and the second is the restriction of conventional instruments of economic control, monetary and fiscal policy, in boosting the aggregate demand and economic growth. Addressing them in a differentiated way requires the formulation and implementation of necessary structural reforms that support entrepreneurship, enhance productivity, improve competition and support economic growth. In addition, it points out that need to take unconventional measures to boost lending and support the economy. Let me now briefly dwell on structural concerns/vulnerabilities/problems and focus on the Bank of Albania’s initiative to address the second challenge.

The Bank’s approach has therefore been to seek to reduce these risks to financial stability by engaging with initiatives which support an orderly market transition and facilitate a shift in financing to support climate goals. I want to talk about three specific areas: disclosure, green finance initiatives and the need for coordination. Disclosure The Bank has been supportive of the FSB’s Task-force for Climate Related Financial Disclosures (TCFD). The TCFD recommendations provide an excellent basis for firms to disclose their exposure to climate-related risks and opportunities and their related strategies, governance and risk management practices. Disclosure helps investors identify which businesses are best equipped to deal with the risks and opportunities that climate change presents. And that in turn creates the pressure for change that ensures the risks are managed better than they would otherwise be. For me what was ground breaking about the TCFD recommendations was the introduction of scenario analysis - where firms set out the resilience of their strategy in different climate related scenarios, including a two degree or lower scenario. To be clear these scenarios are not forecasts or predictions. Rather they are data driven stories that are designed to enable the market to drive better decisions today. They are thus hugely more informative than spot observations of current exposures. And they are absolutely what is required to help investors price medium and long term risks like these. The TCFD recommendations are voluntary. In my view that is important.
Ong Chong Tee: The post-crisis financial landscape - what next? Remarks by Mr Ong Chong Tee, Deputy Managing Director (Financial Supervision) of the Monetary Authority of Singapore, at the Society for Financial Studies Cavalcade Asia-Pacific Conference's Gala Dinner, Singapore, 13 December 2018. * * * Professor Laura Starks – President, Society for Financial Studies Professor Ron Masulis – Program Chair Professor Jun-Koo Kang – Associate Chair, Nanyang Technological University Professor Bernard Yeung – Dean and Stephen Riady Distinguished Professor, National University of Singapore, President, Asian Bureau of Financial & Economic Research Professor Massimo Massa – The Rothschild Chaired Professor of Banking, INSEAD Associate Professor Johan Sulaeman – Dean’s Chair, Department of Finance, NUS Business School Ladies and gentlemen, a very good evening. Thank you for inviting a few of my MAS colleagues and I to be here tonight. Introduction 1 The SFS Cavalcade conference is a distinguished forum that brings together some of the sharpest minds in the world of finance and research. 2 This evening, I thought I could share some perspectives of a financial regulator. My hope is to flag a few pertinent issues that could do well with more research insights and discussion. As the great Hungarian scientist Albert Szent-Gyorgyi once said: “Research is four things: brains with which to think, eyes with which to see, machines with which to measure and fourth, money”.

It is also not unreasonable to expect that traditional business lines between financial services, general commerce or telecoms will increasingly be blurred – and activities may concentrate in the biggest institutions with superior competitive advantages including in the areas of talent, customer base, and customer data. The FAANGs and BATs of this world – the technology giants – come to mind. These may also have implications for financial stability. Indeed, the next systemically important institution could be a BigTech with roots in e-commerce, and therefore, whether such entities require some form of oversight by financial regulators in future. 33 With the increasing use of artificial intelligence (AI) and various forms of data analytics (DA), another area of focus will be around the governance of their use. The MAS recently released a guide that we co-created with some industry partners on a set of principles for Fairness, Ethics, Accountability and Transparency (or FEAT) in the use of “AIDA”. Whether and how the increasing use of machine-learning systems (both supervised and unsupervised), algorithms and data-driven insights can affect behaviours and decision-making in financial institutions will be a rich area for research and attention. Regulators generally like the idea of deploying smart systems that can do a better job in risk detection or risk management. But what about for business decisions or say, personnel decisions? Whether AI-driven systems will perpetuate bias and discrimination is also ripe for more extensive studies.
Although in some areas, such as the unsecured money market or the bond market, the euro seems to have boosted market integration, in other areas, such as repo and equity markets, the impact has been much weaker. The need for further efforts in this direction is fully recognised by many institutions, including the ECB, and is at the heart of the European Union's initiative to create a truly integrated market for financial services. The VicePresident will address this issue tomorrow in his summing-up. The second ECB Central Banking Conference is structured very much like the first one. Today and tomorrow, there will be three sessions covering a number of issues related to the general theme of this conference, and based on research papers and contributions from discussants. A policy panel will follow these sessions. The first session will deal with developments in European banking. The paper by Jean Dermine takes a look at how the European banking system has changed since the Treaty of Rome in 1957. It then asks a provocative question: how "real" is the single banking licence? The second session, tomorrow morning, will address the changing character of European finance, and in particular consider to what extent Europe is shifting from bank financing to market financing. In their paper, Luigi Zingales and Raghu Rajan will assess recent developments in this respect, and impediments to a further shift to a more market-based financial system.

Putting forward concrete proposals The topic of climate risk has been on the agenda of the Basel Committee for several years now; in fact, we were one of the first global standard setting bodies to initiate work on this topic and set up a dedicated high-level Task Force on Climate-related Financial Risks, which is being led by Frank Elderson of the ECB and Kevin Stiroh of the Fed, who are of course no strangers to us thanks to their extensive experience in this area. It´s important to emphise that as the primary global standard setter for banks, the Committee always pursues its work with a view to ensuring a common minimum baseline across member jurisdictions. We achieve this by pursuing an evidence-based approach to our work, and by forming consensus that reflects the different and evolving perspectives of our members. Indeed, as with all the policy and supervisory initiatives undertaken by the Committee, we approach any initiative by first conducting a range of rigorous analyses to better understand the risk features of the topic at hand as well as the potential implications that they might bring to the individual banks and the broader banking system. And this is also the approach we are following when dealing with this matter. To that end, we have focused our initial efforts on analytical research on the climate topic over the past few year, and published two important analytical reports in April.
Peterson Institute for International Economics, 13 April 2021 How to revisit central banking and financial stability? Speech by François Villeroy de Galhau, Governor of the Banque de France  Press contact: Mark Deen (mark.deen@banque-france.fr), Déborah Guedj (deborah.guedj@banquefrance.fr)  Page 1 sur 9 Ladies and Gentlemen, It is a pleasure to be with you today, and I extend my warmest thanks to Adam Posen for his kind welcome speech. As you know, we are living a period of great uncertainties. Yet in this deep mist, one thing is clear: the Covid crisis has increased expectations among the general public about what central banks can and should do, and hence relaunched the debate about their objectives, be it climate mitigation or the fight against inequalities. Admittedly, this is a sign of great confidence: central banks are clearly the victims of their own success in their central roles of price stability. However, as Benjamin Franklin reportedly said: “There are many roads to success, but only one sure road to failure; and that is to try to please everyone.” These additional expectations run the risk of growing confusion and disappointment. Today I will first elaborate on our inflation objective. Although the title of today’s lecture invites us to “revisit” central banking, inflation targeting is and will remain the principal edifice in the shared estate of central banking.

11  All speeches are available online at www.bankofengland.co.uk/news/speeches  11  And the challenges are very different in different jurisdictions, not least because of differences in the structure and effectiveness of monetary policy transmission mechanisms.25 But, taken together with other changes in the economy – such as changes in the labour market which appear to have led to some flattening of the wage Phillips curve and changes in the pass-through of labour costs to consumer prices – the probability is that demand management will need to use more tools to stimulate demand in downturns and work harder to prevent macro-economic tail events. There is a lively debate over the extent to which aggressive use of monetary policy tools to stimulate demand creates financial stability risks by inflating asset prices and encouraging risk taking and the build-up of debt. My own view is that this can be overdone. There are, as I have said, deep-seated underlying structural drivers of low for long. We have not seen an explosion of real economy debt in advanced economies in recent years even with very low rates (Chart 2). Debt-to-GDP has not risen in advanced economies, although there has been a rotation from private sector to public sector debt. Prices of real assets like housing have been growing at a moderate pace in most advanced economies.
Two factors are behind this development: the sharp appreciation of the Swiss franc following the discontinuation of the minimum exchange  2  4  According to World Bank data, the Swiss economy ranked 20th out of 194 countries in 2014. Switzerland’s export intensity is significantly above the OECD average. BIS central bankers’ speeches  rate and the pronounced fall in oil prices last year. These factors are transitory, and as such do not pose a threat to price stability over time in Switzerland. Exchange rate appreciation and the energy price decline are the results of international spillovers that affect consumer prices primarily by lowering import price inflation. 3 Chart 8 shows that most of the downward pressure on Swiss inflation is attributable to these international spillovers. However, as can be seen in the chart, domestic price components have shifted down as well. This harks back to the flexibility of Swiss companies, which I referred to earlier. In particular, those Swiss companies that compete in markets for imported goods have lowered their prices in order to maintain competitiveness in the wake of the exchange rate appreciation. Such price cuts play an important role in restoring the Swiss economy’s price competitiveness over the medium term. They are thus part of the adjustment process in response to the sudden exchange rate appreciation. That such a process can be painful for some of the companies directly involved goes without saying. For this year, we expect consumer price inflation to average about –1.2%.

A further possibility is to temporarily ease the State aid framework for the business sector and establish certain temporary limits on retail electricity prices. More broadly, the war has underlined the need to accelerate European integration so that the EU is an important player on the global stage, capable of deciding its own future and defending its values. A cornerstone of this integration is the creation of a common and permanent fiscal capacity in the euro area, which would facilitate the economic policy response to severe shocks. The design of this common fiscal capacity must be based precisely on the lessons learned from NGEU and the instrument for temporary Support to mitigate Unemployment Risks in an Emergency (SURE), which were implemented to deal with the pandemic, and on any lessons we might draw now from our response to the war. The financial realm is a second area of economic integration. Pan-European bond issuances to fund NGEU, and any other potential issuances as part of the response to the invasion of Ukraine, are an important step towards creating a European safe asset. In addition, deeper capital market integration in the euro area would pave the way for greater risk-sharing in the face of asymmetric shocks. Lastly, a third necessary element to bolster the euro area’s institutional architecture is the completion of the banking union, establishing a European deposit insurance scheme and a common framework for resolving systemic crises.
When the new framework for macroprudential policy is eventually in place and in use, the Riksbank will need to consider how it believes macroprudential policy measures will affect the development of the economy and financial stability in its forecasting work. The Riksbank should be able to take into account the effects of the macroprudential policy instruments in roughly the same way as it now takes into account how the government’s future budget plans will affect the economy. Gradual improvement in economic activity, but uncertainty remains I began this speech by looking back at the economic situation over the last few years. I would now like to spend the rest of my time looking forward. My second argument for leaving the repo rate unchanged at 1 per cent in July and September was namely that the economy seems to be taking a turn for the better. A gradual improvement in economic activity was indeed in line with the Riksbank’s earlier forecast, but ahead of the September meeting we had received additional statistics and other information that supported this assessment. For example, confidence indicators for Sweden and abroad had improved. Share indexes on the financial markets had risen thanks to positive signals about the recovery of the global economy. The outlook for a continued recovery in the United States was good and there were signs that an improvement had begun in the euro area.

This clearly points to one possible mandate for macroprudential supervision that, it were feasible, would be both pragmatic and legitimate: to avoid bubbles. Bubbles are not always triggered within the financial system. They may have roots in productivity shocks, for instance. But they cannot develop unless permissive financial conditions prevail. There are good reasons to prevent bubbles. They impose significant costs on the real economy. They may place an undue burden on monetary policy. They raise important questions of fairness in the distribution of income. Such a simple definition of the objective of macroprudential supervision is quite attractive. However, simplicity comes at a price. Avoiding bubbles present enormous challenges, to which I turn now. The challenges of macroprudential supervision Analytical challenges The first – and most important – challenge is analytical. Bubbles are difficult to detect. Asset price boom-bust cycles become clearly apparent only after the event. Moreover there is little regularity in the business cycle, which makes it difficult to identify with certainty long lasting deviations of asset prices from fundamentals. Looking at the path of asset prices, how do we know ex ante if we are confronted with an inflexion in the trend, a one-step adjustment in equilibrium levels, or the start of a bubble? There is no simple or mechanical answer to that question. This is one of the reasons why "early warning" mechanisms have not really worked.
But it went on, “…there are serious possibilities of conflict between them.”4 Second, the rate of inflation in the long run is determined by monetary policy, not by microeconomic factors. Again, that is now taken for granted, but much effort was devoted to the imposition of detailed direct wage and price controls in the 1960s and 1970s. Nicholas Kaldor, adviser to Harold Wilson, wrote in 1971 that “It is also far more generally acknowledged – even by Conservative Prime Ministers – that the process of inflation is 'cost-induced' and not demand-induced', with the evident implication that it can be tackled only by an incomes policy'”. Not many Whitehall advisers would give that answer today. Third, in the short run monetary policy does affect output and employment and so has the potential to be an effective stabilisation tool. Reflecting a post-war consensus that monetary policy was rather ineffective, however, the Radcliffe Report concluded that “…. there can be no reliance on this weapon [interest rate policy] as a major short-term stabiliser of demand”5 It is now accepted that monetary policy lies at the heart of any attempt to stabilise the economy. The source of monetary policy’s influence over output and employment lies in frictions, which mean that prices and wages do not adjust instantaneously to clear markets whenever demand and supply are out of balance. Firms change prices only irregularly in response to changes in demand; wages adjust only slowly as labour market conditions alter; and expectations are updated only slowly as new information is received.

An inflation targeting framework combines two distinct elements: (a) a precise numerical target for inflation in the mediumterm and (b) a response to economic shocks in the short term. The inflation target provides a rule-like framework on which the private sector can anchor its expectations about future inflation. As Gordon Brown put it in his Mais Lecture in 1999, "a credible framework means working within clearly defined  12  6  To be precise, the angle of gaze remains within a certain range - reported by Gigerenzer and Selten (2001). BIS Review 36/2005  long-term policy objectives, maximum openness and transparency, and clear and accountable divisions of responsibility". It is a natural heuristic around which agents can form their expectations. And the discretion in responding to shocks afforded by inflation targeting allows the central bank to adapt its strategy to new information. That is why inflation targeting is sometimes referred to as a framework of “constrained discretion”. Following a shock which moves inflation away from target and output from its normal level, there is discretion about the horizon over which inflation is brought back to target. But the exercise of that discretion must be clearly explained and justified in terms of the need, in the words of the remit of the Monetary Policy Committee, to avoid “undesirable volatility in output”.
Studies of heterogeneity provide new insight into how the key policy rate operates. The use of different types of microdata is therefore a priority for Norges Bank. We want to include the knowledge gained from microdata in the Bank’s analytical apparatus, and work is in progress to develop a general equilibrium model using heterogeneous agents. The model takes into account that debt ratios depend on the lifecycle stage of the household. The effect of the labour market situation also varies across age groups. All these model features influence the strength of monetary policy’s impact. The new model has the potential to be a useful supplement to the Bank’s main model, NEMO. Neither the household debt-to-GDP ratio nor the distribution of debt and assets across age groups are constant. Over time, changes in these variables can influence the effect of the interest rate on the economy. The combination of an ample supply of microdata and more complex model analyses will strengthen the analytical basis for monetary policy. Conclusion Let me conclude. After a long period of low interest rates, the key policy rate is again on the rise. The rate increase can be expected to be gradual and is a response to the solid activity we now see in the Norwegian economy. Solid activity also means higher employment and prospects for higher wage growth, and Norwegian households will be better off financially despite the rise in interest rate expenses.

This was fueled in part by concern that the counterparty claims on failed institutions would be frozen and unable to be realized quickly. Not only did some core firms have inadequate capital and liquidity, they also faced conflicting incentives as to how to manage their capital resources. For example, many firms that came under stress were slow to cut their dividends or to raise new capital because of fears that such actions would signal their underlying weakness. Obviously, the failure to conserve capital made these institutions weaker rather than stronger. The crisis also underscored severe deficiencies in the international dimension of the regulatory environment. Financial institutions, flows and activities are global, but the vast majority of regulation and information sharing is contained within national boundaries. Where resolution regimes existed, they generally existed only for banking entities and were not set up to handle the orderly resolution of a large internationally active bank holding company or non-bank financial firm. This cross-border problem persists to this day. The interconnectedness of the financial system also caused shocks to spread quickly. For example, the failure of Lehman Brothers led to losses at the Reserve Fund, which precipitated a widespread money market mutual fund panic. It also led to actions by U.K. bankruptcy authorities that had the effect of freezing the assets owned by hedge fund and other clients of the firm and this encouraged such investors to pull assets from other institutions perceived to be weak.