samchain/econo-pairs-v1 huggingface dataset:
Figure 12 Monetary impulse and fiscal packages 4.5 Korean Republic  Fiscal stimulus packages in 2009 (% GDP)  4.0 3.5 3.0 2.5  China Canada  Japan  Germany  1.5  Indonesia  1.0  Mexico  France  0.5  Italy  0  -200  Chile U.S.A.  Australia  2.0  0.0  Russia  India  -400  South Africa Argentina United Kingdom Turkey  Brazil  -600  -800  -1,000  -1,200  Current MPR versus maximum MPR during 2007-2009 (basis point) Sources: Central Bank of Chile, Bloomberg, International Monetary Fund and Finance Ministry. 12  BIS Review 9/2010  Table 1 Economic growth and current account (annual change, percent) 2007  2008  2009 (f)  2010 (f)  GDP National income  4.7 7.1  3.2 3.8  -1.9 -2.3  4,5 - 5,5 7.5  Domestic demand Domestic demand (w/o change in inventories) Gross fixed capital formation Total consumption Goods and services exports Goods and services imports  7.8 8.2 12.0 7.1 7.6 14.9  7.4 7.9 19.5 4.2 3.1 12.9  -7.4 -3.3 -16.1 1.5 -4.1 -15.7  8.9 4.6 8.2 3.5 5.4 14.3  Current account (% of GDP)  4.4  -2.0  2.1  0.6  (f) Forecast. Source: Central Bank of Chile.

In Chile, domestic demand continues to reflect substantial inventory depletion and, to a lesser extent, a drop in gross fixed capital formation, particularly the machinery & equipment component (figure 7). Inventory depletion has exceeded September projections and those of other economies, shaving-off four percentage points of domestic demand in the last year. More recently, some indicators suggest that the inventory cycle is entering a new phase, where part of the depletion could respond to sales increasing faster than production (figure 8). The end of the drop in inventories has a positive effect on GDP by itself, but the size and timing of its contribution to growth is still uncertain. This will depend on the level that firms consider adequate to face a cyclical recovery. It is very likely that such level will be smaller than it was before the global crisis. The adjustment of gross fixed capital formation has been similar to that of Asian economies, with quarterly drops of around 10% between end-of 2008 and beginning-of 2009 (figure 9). Weak investment is reflected in sluggish imports of capital goods, which are yet to show a rebound. Investments in engineering and construction works have improved. Although a fall is expected for this year, information from the Capital Goods Survey shows a new increase in investment projects in the period 2009–2012, with some of them being pushed off from this year to the next one or two. Gross fixed capital formation will drop more than 15% annually in 2009, which will presumably revert in part during 2010.
Their study suggests that the American  purchases of government securities did not affect the term structure and did not press down rates on other securities. 10 This interpretation is also in line with the Riksbank's communicated assessment that it would be possible to cut the policy rate to lower levels (see, for example, the Riksbank, 2016). 5 [30]  market, and the even lower rate on short government securities, which also led to a fall in the rate on longer-term government securities. Figure 3. Government bonds and covered bonds against expected policy rate Basis points  Note. Differential between rate on each bond and expected policy rate. Refers to bonds with a maturity of 5 years and an expected policy rate of 5 years ahead. Footnote 7 explains how the expected policy rate is calculated. Sources: Bloomberg, Macrobond, Refinitiv and the Riksbank. A relevant question is whether the Riksbank could have achieved the same effect by cutting the policy rate to −0.80 per cent instead of buying government bonds. I am unsure of the answer, but suspect that the effects would then have been different. Perhaps a lower policy rate had more clearly affected lending rates and also pressured the banks' profitability, but had similar effects on the exchange rate, something I will come back to in a moment.11 I also suspect that the Riksbank would have found it more difficult to communicate an even more negative policy rate.

Second, this pricing indicates that government securities began to be valued higher than central bank money when the purchases started. Investors bought government securities with lower interest rates than the rate paid on Riksbank Certificates and deposits overnight at the Riksbank. Another common idea is that the central bank adds value by providing liquidity and reducing the term premium when purchasing government securities in exchange for more coveted central bank money. This does not seem to have been the case in Sweden. Both the Riksbank and the Swedish National Debt Office judged that the term premium was close to zero, or negative, when the Riksbank's purchases began and that the overall term and liquidity premiums subsequently became negative.12  11 However, my assessment is that the effective lower bound for the Swedish policy rate is around −0.50 per cent  or possibly slightly higher, and that the banks had not further reduced their lending rates if we had cut the policy rate below −0.50 per cent. 12 See Figure 2-3 and Figure 3 in Flodén (2016). 6 [30]  Unclear whether lower long-term interest rates are a stimulus in the Swedish economy Third, it is doubtful whether lower interest rates on longer maturities stimulates demand in the Swedish economy. Unlike the US economy, for example, the Swedish financial market is dominated by short-term interest rates.
Third, there is scope to extend Islamic finance solutions to meet infrastructure financing needs in Asia and in the Middle East. In particular, the Asian Development Bank (ADB) has been working with the Islamic Development Bank (IDB) to provide Islamic infrastructure financing solutions to their member countries in these two regions. This includes developing and participating in innovative financing structures such as the Islamic Infrastructure Fund and the International Islamic Liquidity Management Corporation. The IDB is also exploring a potential link-up with the planned Asian Infrastructure Investment Bank (AIIB). This could spur the use of sukuk to fund some of Asia’s infrastructure needs, and tap a growing pool of Islamic investors across the Middle East and Southeast Asia. Islamic finance in Singapore 10. As an international financial centre and one that serves as a gateway for investments into Asia, Islamic finance is an important asset class that complements Singapore’s strong conventional financing and capital market capabilities. Islamic finance activities in Singapore are broad-based, covering Islamic banking, asset management and capital markets, which mirror our conventional strengths: •  Islamic banking assets in Singapore have grown by 73% since 2010, and are increasingly cross-border in nature. Consistent with the pattern for conventional finance, Islamic banking liabilities sourced from the region are subsequently deployed to Southeast Asia and the GCC;  •  Assets under management have also risen, by 22% since 2010. Singapore is home to Sabana REIT, which is the largest Islamic REIT globally by asset size.

The stock of private productive capital (relative to employment) has increased by 40%, and much the same can be said of the stock of residential capital (relative to the population). The stock of public capital, essentially comprising transport, health, educational and other infrastructure, has almost tripled in real per capita terms over this period. Government spending on education and health has risen twofold. The percentage of the adult population with intermediate and higher studies has increased by 28 pp and 20 pp, respectively. Moreover, since 1978, the Spanish population has grown by over 10 million, and the number of people in work has risen by more than 8 million, including over 6 million women. This has raised the female participation rate from a mere 28% to 54%. Overall, economic success in the democratic era can probably be put down to a combination of our economic integration into Europe, the consolidation of stability-oriented economic policies, the development of our welfare state and the modernisation of our tax system. Against this backdrop, I would like to focus my address on the outstanding structural challenges and the economic policies best equipped to address them, as further explored in the Banco de España's latest Annual Report, published in May. These challenges can be illustrated, first of all, by acknowledging the Spanish economy's failure in recent decades to converge consistently towards the per capita income levels of the euro area.
Further interest rate hikes are expected in the euro area, Sweden and the UK, while interest rates in the US may fall over the next year. In Norway, the interest rate was reduced to a very low level in 2003 and 2004 when inflation fell and approached zero. There is a dynamic inherent in interest-rate setting. Low interest rates stimulated demand and production and eventually led to prospects for higher inflation, to which we are reacting by raising interest rates. Interest rate developments must be seen in the light of actual price developments and inflation, output and employment prospects. 10  BIS Review 47/2007  It normally takes some time for interest rates to have an impact on prices via changes in expectations, exchange rates or capacity utilisation. Consequently, interest rate setting must be based on our expectations of developments ahead. The interest rate was raised in response to the strong increase in capacity utilisation and the associated inflation prospects. The interest rate has thus been increased well ahead of an actual rise in inflation. Growth in capacity utilisation has been stronger than projected one year ago. The interest rate has thus been increased somewhat faster than Norges Bank presented as the most likely path at that time. In the interest of enhancing the transparency surrounding our conduct of monetary policy, we have published our own interest rate forecast over the past year and a half.

Interest rates will continue to be raised gradually ahead so that we can assess the effects of interest rate changes and other new information about economic developments. Thank you for the opportunity to present these assessments before answering questions. 12  BIS Review 47/2007
Another indication of this trend towards the consolidation of savings is that the long-term financial liabilities of monetary financial institutions in the euro area increased notably in 1999 (by 7.2% in the year to the end of November 1999). Furthermore, the primacy of price stability contributes to improving macroeconomic stability, thus encouraging long-term investment. The reduction in real interest rates following the reduction in the inflation premium works in the same way. I should like to note here that investment and saving are two sides of the same coin (as shown in the national accounts, which include investment within gross savings), i.e. the accumulation of physical or financial capital with a view to a future return. Third, price stability has major implications for the social distribution of efforts to save. Price stability is especially beneficial for the less well-off sections of society, which often lack sufficient information to protect their savings in a period of inflation. At a time when we are very preoccupied by adjusting working hours and the retirement age, it is essential that everyone should have the opportunity to save, i.e. to set aside part of their future income, relatively safely. However, the principle of monetary stability very clearly highlights the issue of the distribution of income between generations.

In a situation where the proportion of public spending has reached a very high level (in 1999 it accounted for 49% of GDP in the euro area, compared with only 39% in Japan and 34% in the United States) and where government deficits are limited by the Treaty and can no longer be covered by inflation, the role of private savings in the future financing of retirement attains a crucial dimension. I should like to end this first part by saying that the positive effect of price stability on domestic savings naturally contributes, in the world capital market we live in, to guaranteeing the lasting attractiveness of the euro area for long-term financial investments by non-residents. This also requires that other economic policies contribute to a favourable environment, through structural measures aiming at increasing flexibility in the labour market and efficiency in the markets for goods, services and capital. I have emphasised the effects of the Eurosystem’s monetary policy on the volume of savings and its consolidation. The creation, with the euro, of a vast currency zone also contributes to a more efficient management of savings. BIS Review 6/2000  2  2. The creation of the euro is leading to larger and more integrated financial markets, improving the allocation of financial savings. The creation of the euro has accelerated the development and integration of the capital markets in Europe, which have been helped along in recent years by financial liberalisation and technological innovation.
This dynamic should have been mitigated to some extent by the rating agencies as they assigned ratings to these new securities, but that process too proved inadequate, especially for residential real estaterelated securities. The problems associated with these misaligned incentives for issuers and inadequate rigor on the part of the rating agencies became apparent as the housing sector turned down and the economy weakened. The result was a dramatic spike in credit losses and an almost complete loss of investor appetite for non-agency, residential mortgagebacked product. A second factor contributing to the collapse of the ABS market was that the benefits of pooling and distributing risk more widely proved to be somewhat illusory. In practice, the performance across different loans that collateralized the securities was much more highly correlated than was anticipated, and the risks associated with these securities was significantly more concentrated than had been assumed. Some banks that were unable to sell the highest-rated tranches kept them on their books. In other cases, the sales were made to off-balance sheet vehicles, in which the banks retained residual risk. This correlation contributed to the aversion of investors to the asset class as a whole. A third contributing factor was the fact that these securities were often complex and heterogeneous and, thus, hard to value. In a stressed economic environment, this complexity exacerbated the erosion in market liquidity conditions, which in turn led to a vicious circle of falling prices and even further diminished liquidity.

BIS Review 80/2007  11  Currency issuing The increase of currency in circulation over 2006, by ALL 14, 7 billion is a response to the balanced macroeconomic development of the country. The commercial bank’s receivables by the Bank of Albania during 2006 stood at ALL 105 billion, remaining almost at the same level with that of 2005. Concerning cash payments, from Bank of Albania’s cash-boxes to commercial banks, the supply was carried out according to their requests, and intending, at the same time, to maintain the currency in circulation structure within the projected limits for year-end 2006. The velocity of money circulation over 2006, for the shortened cycle of circulation, totalled almost at the same level as in 2005. However, the velocity of circulation underwent changes for certain denominations of banknotes and coins. Hence, a significant increase of velocity of circulation was proved in the 5.000 lekë, 1.000 lekë and 500 lekë denominations, respectively by 13.3 percent, 38.9 percent and 8.3 percent. Changes in banking legislation During 2006, further to the signing of the Stabilization and Association Agreement on 12 June, 2006, the banking legislation was amended and improved substantially once the Law “On the Banks in the Republic of Albania”, No. 9662 of 18.12.2006 was passed by the Assembly of the Republic of Albania, which shall become effective on 1 June, 2007.
At any rate, our projections for next year assume that these expectations will recover and provide support, together with many other factors, to a rebound in economic growth. Let me now share with you our baseline scenario and the main risks we have identified in the reports we present today. BIS central bankers’ speeches  1  Macroeconomic scenario Inflation brought surprises all throughout 2014 by being unexpectedly high. Earlier in the year, the Board assumed that inflation would be at 3 percent at year’s end, partly because the accumulated depreciation would have a limited effect on inflation, in line with historical patterns. Such evaluation was modified as actual data showed higher than expected transmission to final prices. So, as soon as June the inflation forecast was revised significantly upward. In recent months, such transmission has been in line with expectations. However, the sharper depreciation of the peso and some specific elements – in particular, the rising price of some fresh fruits and vegetables – pushed inflation up above projections. These increases reversed somewhat in November, helped by the drop in fuel prices, which should continue to play a part in lowering inflation over the coming months. Private inflation expectations also posted significant changes during the year, consistently with the aforementioned surprises (figure 1). Regarding output, in the third quarter both domestic demand and GDP grew less than forecasted in September, although the surprise was milder than it had been in the second quarter.

Woodford’s (2005) formulation: ” For not only do expectations matter, […] very little else matters.”  BIS Review 110/2009  1  Criteria for a “good” interest rate path Inspired by Svensson, Norges Bank has developed a set of criteria for a “good” interest rate path. The intention is to make it easier for others to understand how we think, although the criteria also define the agenda for the internal discussion. 2 The first criterion for a good interest rate path is to set the interest rate with a view to bringing inflation back to target in the medium term following a shock. The primary objective is to achieve the inflation target. The second criterion reflects the flexibility of inflation targeting. There are many routes to the objective. Which one should we choose? According to the criteria, emphasis should be placed on finding an interest rate path that also stabilises output and employment. So far, our approach tracks Svensson’s theoretical approach fairly closely, with some deviation from the analytical method he presents in his article. The most important difference is that we have chosen to focus directly on the target, using a loss function to describe monetary policy. The approach proposed in the article primarily relies on a description of policy under different rules followed by calculation of the loss using the loss function. Because the model is primarily a model and reality is primarily reality, some tailoring is required to connect model and reality. Some additional criteria have therefore been formulated.
Capital markets In addition to sound and forward-looking financial institutions, it is important that we develop broad and deep capital markets. These are two complementary pillars of a vibrant and dynamic financial hub. Our domestic markets alone will not sustain the depth, breadth and resilience needed by liquid capital markets. It is thus critical for us to develop the equity and debt markets to help service Asian needs, and be linked up with global markets. Foreign companies must find distinct advantages to list on SGX, or to issue bonds in Singapore. They want to raise capital at the lowest cost, and find liquidity and support for their securities in the secondary market. This requires adequate interest from local and foreign investors for securities issued in Singapore. We must thus offer investors easy access to trading securities and derivatives in Singapore, as a key Asian leg in their global cycle. Equities In the equities market, although SGX was the first exchange in Asia to merge and demutualise, in other areas, other countries are ahead. For example, we have been slow to develop online trading. To get more shares traded online, SGX will build up IT capacity and systems at the exchange and the brokerages, and ensure that prudential safeguards are in place. SGX is also considering faster liberalisation of commissions for on-line trading, so that it need no longer regulate what brokers charge and whether they give customers discounts. SGX must attract more foreign companies to list and trade actively in Singapore. This will not be easy.

BIS Review 30/2000  4  Local banks have upgraded their corporate governance. They have renewed their boards, appointed nominating committees, and emphasised recruitment of talent, including from abroad. The structures are now in place. But getting the new forms to work as intended will take time and effort. Banks must persevere to strengthen their boards and management, their systems of recruitment and promotion, and their ethos of shareholder value, meritocracy and professionalism. Investing public The public needs to shift more towards an investment rather than a punting mentality. Few fully appreciate the meaning of caveat emptor: that they take responsibility for their own investment decisions, and accept the risks along with the upside. Unfortunately this is only brought home when the market crashes, or when problems surface. The tech stock mania has reached Asia. Even Abby Cohen of Goldman Sachs, the foremost Wall Street bull, last week sounded a cautionary note about tech stocks, and stressed the importance of a diversified investment portfolio. In Hong Kong, tom.com was 669 times over-subscribed. An old lady queuing up for her application form was heard to ask “What is the internet”? People believe that tom.com is a sure bet, even though it has no business and no revenues to date. Mr Andrew Sheng, Chairman of HK’s Securities and Futures Commission, has been trying to cool the frenzy. But he told me that investor education does not work. This is the universal lament of regulators.
However, recent developments increase the downward risks, especially in the external economy, for which the Central Bank must be ready to respond. IV. Final remarks  Mr President, dear Senators, the MPR cut decided by the Board last Friday has been described as “surprising” or “unexpected” by the observers. Indeed, it was an adjustment that most analysts did not see coming, in either its timing or magnitude. However, it was not an unpredictable change in light of the background, analysis and communication that the Bank had been delivering in the preceding months. Moreover, it is a decision based in depth on the report that I have presented today. Before I finish, I would like to draw your attention to the exceptional nature of the circumstances that led to this decision and its implications for the Bank’s communication and actions in the future. At the beginning of this presentation, I mentioned that we have defined this decision as a “recalibration” of monetary policy, as it is an adjustment of the MPR to generate a monetary impulse compatible with the inflation target in the face of significant and consistent changes in the estimates of capacity gaps, inflation and the policy rate. This time around there has been an unusual combination of new information for all the structural parameters plus the new inflation measurement, pointing in the same direction.

Page 10 of 18  15  16  6 3  Figure 3 Inflation indicators (*) (annual change, percent)  6  6  5  5  Services CPI  4  4  services EFE  3  3 CPI  2  2  1  CPIEFE  Goods CPI  1  0  0  -1  -1  goods EFE  14  15  16  17  18  19  (*) As from January 2019, the new 2018=100 annual base indexes are used, so they are not strictly comparable with earlier figures. Sources: Central Bank of Chile and National Statistics Institute (INE). Figure 4 Non-mining GDP (real annual change, percent)  6  6  5  5  Trend  4  4  Potential  3  3  2  2 Actual (moving annual average)  1  1  0  0 13  14  15  16  17  Source: Central Bank of Chile.