samchain/econo-pairs-v1 huggingface dataset:
Perhaps the most important factor that has for several decades sustained the economic success of the emerging Asian economies is its economic flexibility to adjust to the changing conditions in the global environment. This economic flexibility is supported by the high degree of labour and capital mobility within the national economies and the significant investment accorded to education and to infrastructure development. The region has also adopted a pragmatic approach to policy that is not constrained by rigid ideology. In this more recent decade, institutional development, extensive financial reforms, and the adoption of new business models have been an important part of this transformation process. Several of the economies in emerging Asia’s have transformed their production capacity in the manufacturing and services sector to meet the changing demands of the global economy  BIS Review 131/2010  1  and the growing consumer market in Asia. Given the different stages of development and endowment of natural resources in the region, the emerging economies in Asia have also leveraged on their respective distinct comparative advantages. This has resulted in intraregional division of labour and specialisation, and the capacity to undertake the entire spectrum of the supply chain for a wide range of products and services. Part of the economic restructuring has also involved the greater emphasis on domestic demand as an important source of growth. This has involved significant increases in domestic private consumption and investment activities.

In Asia, efforts are underway to address these specific issues recognising that in this interconnected environment, the execution of remedial and containment measures will be highly complex and challenging. Focus is also being given to having enhanced surveillance and oversight that is complemented by a robust framework for governance, transparency and accountability. Given the strong presence of international institutions in the Asian region, we have strong interest in the establishment of an effective cross border resolution mechanism so that any failure of such large and systemically important institutions with cross border representations can be dealt with effectively in an orderly manner. This will require cooperation and coordination across countries, taking into consideration their differing regulatory and legal systems. A further priority in emerging Asia is the promotion of responsible market practices and consumer protection given the stage of development and level of financial literacy. There is significant scope for creating greater global momentum for improvements in regulatory standards on market practices. Much work still remains ahead and would require resolve and commitment in this reform agenda. The more inclusive global process is critical to this effort and should be further deepened to truly reflect the global dimension of the financial system in this 21st century. On the recent increasingly intense debate on the role of the exchange rate as the solution to the global imbalances, it needs to be recognised that the foreign exchange market is not like any other markets.
I shall be stepping up the efforts of the HKMA to promote a better understanding of them. Transparency 21. The second area that requires attention in the political process of monetary management concerns the transparency of the HKMA. To at least the minority of those members of Legislative Council who supported the defeated Motion to review the HKMA, the transparency of the HKMA was found to be lacking. Although the Motion was defeated, the fact that transparency was an issue, even to the minority of the Legislature, is quite surprising to me. It is perhaps not something that I can afford to ignore. However, compared with other central banks, the HKMA must be among the most transparent in the world. In monetary management specifically, I am quite sure that we are the most transparent in the world. I know of no other central bank that discloses information about the monetary base, and operations affecting it, on a real-time basis. There is also an abundance of information published in the HKMA’s regular series of monthly, quarterly and annual reports, and in the ad hoc publications on specific monetary and banking issues. Figures on foreign reserves are published monthly and soon we shall be publishing the balance sheet of the Exchange Fund also on a monthly basis. 22.

Security of payments The rapid development of e-commerce in recent years and the increased use of electronic channels to initiate payments pose new challenges related to ensuring the security and customers’ data. As of September 2019, it has become mandatory in Europe to implement strong customer authentication. This means that when an electronic payment is initiated, at least two independent elements from different categories – knowledge, possession and inherence – must be used in the process. In the case of remote payment transactions, e.g. via internet, an additional requirement is introduced to perform so-called dynamic linking – linking the code for each transaction to a specific amount and a specific payee. These requirements are implemented by the payment service providers in our country. For the practical implementation of these regulatory requirements, new technologies are again coming to the rescue. Recently, biometric authentication has shown great potential by providing verification of elements characterising the user: fingerprint, iris scanning, facial recognition, etc. Many payment service providers in Bulgaria have already introduced similar customer identification methods using mobile banking applications. Apart from convenience, this leads to a significant increase in the security of the payment process, allowing the use of biometric data for customer identification. On the occasion of the forthcoming review of the Second Payment Services Directive, a comprehensive assessment of the impact of strong customer authentication on the level of payment fraud is to be carried out.
Regarding output, first-quarter GDP and demand growth figures exceeded March expectations, influenced by improved figures in agriculture and, somewhat less, mining. Overall, our growth outlook is essentially unchanged. We expect the economy to continue to grow below potential for some quarters, due mainly to poor performance of those sectors with closer links with investment. Anyway, it is worth noting that retail trade and personal services have proven more resilient, reflecting a more gradual adjustment on the consumption side. The baseline scenario of this Report sees GDP growing between 1.25 and 2.0 percent this year and between 2 and 3 percent in 2017. This estimate is based on the assumption that the economy will resume near-potential growth towards the end of the projection horizon. Finally, it uses as a working assumption that public expenditure will follow a trajectory consistent with the fiscal rule and the Administration’s announced budgetary consolidation path. The process of growth normalization will be slow. Of particular concern is the behavior of investment, which the baseline scenario estimates will drop for the third year in a row. Indeed, this year several indicators, among which the survey of the Capital Goods Corporation, the levels of imports of capital goods and business confidence, anticipate a further drop in investment. Moreover, the housing sector will have a limited performance after being highly dynamic in 2015, and public investment will follow a trajectory consistent with the objectives of fiscal consolidation.

My address today will focus on three issues. The first is the lessons learned from past crises. The second is the post-crisis environment and their implications for emerging markets. And, the third is the challenge for central banks going forward. First, the lessons learned. Those of you who have been at central banks fifteen years or more will by now have witnessed at least two major financial crises that put the task of central banks in managing the economy under the spotlight. The first is the Asian financial crisis of 1997–98, and the second is the current global financial crisis. Although the two crises share many similarities as well as exhibit important differences, they both have a common origin in globalization and in the inability of the global financial system to deal effectively with the consequences of globalization. In the Asian crisis, the origin was in external imbalance of individual economies, private sector indebtedness, currency mismatch, and a sudden reversal of capital flows. In the current crisis, the origin lay in a large global imbalance, excessive-risk taking by financial institutions, and the accumulation of large systemic risk. In the context of policy, the two crises have produced many useful lessons on what needs to be done to prevent the recurrence of crises. While there is no shortage of lessons learned, having been at the Bank of Thailand through the two crises, my own list of lessons learned comes down to four important lessons. The first is that nobody is above crises.
Research, including the PRA’s own analysis of survey responses from UK firms, suggests that the fixed costs of implementing new requirements can be proportionally higher for small firms than for large ones when measured as a fraction of a firm’s assets.7 What this tells us is that there are economies of scale when it comes to compliance costs and that some costs fall relatively heavier on small firms than on large firms. At the same time, separate research by Bank staff shows that prudential requirements that are well-matched with the risks that cause large banks to fail are not so well-matched with those that cause small banks to fail.8 Putting this evidence together, we can ask whether there are requirements which are relatively more costly for small firms to implement but which deliver fewer benefits than when they are applied to large firms. And that is what we do in this Discussion Paper. Having identified requirements which do not make a material  6  Amadxarif et al.

Let me conclude by saying that I welcome discussions on monetary policy. Monetary policy is to a great extent based on assessments and it is therefore natural that there are differing opinions as to what should be done with the repo rate – both outside of the Riksbank and within the Executive Board. However, it is also important that the discussion is based on a realistic picture of what monetary policy can achieve. Nor should the discussion be simplified by targeting one issue without taking into account all of the risks and other aspects that need to be weighed against one another in monetary policy decisions. We at the Riksbank will do all we can to contribute to this type of discussion climate. 6  BIS Review 12/2006
Joshua Rosenberg: Thrive in any environment - strengthening resilience through risk management Remarks by Mr Joshua Rosenberg, Executive Vice President and Chief Risk Officer of the Federal Reserve Bank of New York, at the GARP Global Risk Forum, Federal Reserve Bank of New York, New York City, 7 November 2019. * * * As prepared for delivery Good morning and thank you for the opportunity to speak to you today. Let me begin by saying that the views I express are my own and do not necessarily represent those of the Federal Reserve Bank of New York or the Federal Reserve System. The ability to thrive in any environment, in both normal and chaotic conditions, is an organizational imperative. We can strengthen organizational resilience—“the ability to prepare and plan for, absorb, recover from, and more successfully adapt to adverse events”—through risk management.1 That’s because the tools of risk management help us make plans and take action today in the face of an uncertain tomorrow. In fact, we can deliver even more value to our organizations by defining resilience as a goal of risk management. Today, I will talk about some of the challenges to achieving resilience and how risk management can be part of the solution. While there are many aspects of resilience, I’m going to choose two challenges and their connection to risk management: organizational silos and the complexity of control. Organizational Silos The first challenge is organizational silos.2 Threats do not respect organizational boundaries. Some, like cyber threats, actually exploit them.

In other words, controls can cause harm.8 On Tuesday morning, a hurricane damages your main office and floods the backup generator that powers the emergency communications system. Because the emergency communication system is offline, employees do not know they should report to the backup work location, so operations are out for the day. In a simple world, controls are protection, they don’t need protection. In the real world, both the production and control system can be damaged and degraded. So, the control system itself must be designed to operate under stress, and its performance must be monitored. It’s been a tough week so far, but you’ve made it to Wednesday. At noon, your information security officer tells you that a security scan has flagged a possible cyber breach. You cut off all network connections, send non-essential employees home, and wait until the end of the day until diagnostics are complete. The news at the end of the day is good: it turns out that the alert was a false positive. But, the organization lost half a day of productive activity. In a simple world, controls detect problems immediately, diagnose with perfect accuracy, and result in corrective actions that are instantly and fully effective. In the real world, detection takes time, diagnosis is not always accurate, solutions take time to implement, and they don’t always work. That said, we must make decisions—including ones about whether and how to execute controls—based on the information available at the time.
Simon M Potter: The Federal Reserve’s counterparty framework – past, present and future Remarks by Mr Simon M Potter, Executive Vice President of the Markets Group of the Federal Reserve Bank of New York, at the 2015 Roundtable on Treasury Markets and Debt Management, Federal Reserve Bank of New York, New York City, 19 November 2015. *  *  *  Good evening. I would like to thank the Office of Debt Management for inviting me to speak at this year’s roundtable. This forum provides a valuable opportunity for policymakers, academics, and market participants to discuss issues related to the primary and secondary markets for U.S. Treasury securities. I will focus my remarks tonight on the counterparty framework employed by the Federal Reserve Bank of New York, which directly affects not only our implementation of monetary policy, but also the underwriting and distribution of Treasury debt issuance. I will begin with an overview of the objectives that underpin the framework, continue by describing how those objectives have influenced the historical development of the primary dealer system, and conclude by looking ahead as the private and official sectors adapt to the evolving structure of the Treasury market.

Similarly, the Desk’s foreign reserve management counterparties facilitate operations that are investments of the Fed’s and also the Treasury’s foreign currency reserves. Two other considerations underlie the counterparty framework and support the effective execution of open market operations and primary issuance of Treasury securities. First, the Desk has long recognized the importance of transacting with established, regulated market participants that are capable of settling trades and financing long and short positions reliably  1  I would like to thank Stephen Douglass, Frank Keane, and Susan McLaughlin for their excellent assistance in the preparation of these remarks and colleagues in the Federal Reserve System for numerous insightful comments and suggestions. 2  Counterparties also facilitate the Desk’s provision of services to foreign central banks, governments and international official institutions. Additional detail on these services can be found on this website. BIS central bankers’ speeches  1  and on a consistent basis in a range of market conditions. Our counterparty framework must be of an appropriate size to provide adequate execution capacity and competitive pricing. Second, the execution of domestic open market operations and primary issuance of Treasuries is facilitated by a liquid, smoothly functioning secondary market for Treasury securities. The Federal Reserve’s abiding interest in promoting the integrity and efficiency of the secondary market has motivated our recent efforts to join other agencies in analyzing the events of October 15, 2014, and to understand the implications of the evolution of Treasury market structure and the increasing incidence of electronic and automated trading.
Inflation may then become ingrained and difficult to bring down again. When inflation took off in spring 2022, it became clear that the policy rate level was no longer appropriate for the economic situation in Norway. The policy rate was raised quickly, and in autumn 2022, the rate reached a level where it likely began to have a tightening effect on the economy. At its meeting last week, the Monetary Policy and Financial Stability Committee raised the policy rate to 3.25 percent and will most likely raise the rate further in June. Let me say a little more about economic developments over the past year and our assessments. The pandemic led to higher prices for energy, metals and other globally traded goods. The price increases were amplified by Russia's invasion of Ukraine. The rise in these prices is an important source of the high level of consumer price inflation. High energy prices and other input costs have generated higher costs for businesses, who have in turn raised their selling prices. Chart 4: A year ago the economy was in high gear When the cost shock hit Norway in spring last year, the economy was in high gear, with strong demand and higher-than-potential output in the economy. Many businesses were facing labour shortages. Economic activity remained strong through 2022. Excess savings accumulated during the pandemic have enabled many people to sustain consumption despite high inflation and higher interest rates. At the same time, mainland business investment has risen substantially.

These developments, however, have raised various issues related to the requirements for bank openness, customer security, transparency and trust in the payment services market as well as consumer rights protection. Consequently, the regulators have to adopt appropriate legislative framework that supports digitalization, innovation and competition, but also take care of security and protection. In this context, it can be noticed that the European Union is a global leader in this domain. By revising the Payment Services Directive (PSD2), the European Union enables stronger competition and 1/3  BIS central bankers' speeches  innovation by allowing entrance of FinTech payment service providers that will eventually lead to greater choice and better prices for consumers, it will fosters cyber resilience of the payment service providers as well as enhance protection of payment services users. In this way, the European Union created a sound legal framework for digitalized payments landscape that enhances the integration of the single payment. At the same time, it sets an example for other countries around the world how to support digitalization trends by balancing between innovation and competition, on the one hand, and security and protection, on the other hand. The new regulatory framework implies that banks will no longer only be competing against banks, but everyone offering financial services, i.e. the customers will be able to create a set of providers of different financial services instead of relining on one bank for all services.
Again, this is a question that comes down to the objectives in pursuit of which policy is being set. As my colleague Ben Broadbent has said, you need to look not just at who, in terms of which policy institution, is doing what, but also why they are doing what they are doing in terms of policy actions.21  Since the start of the Covid pandemic the priority for both the MPC and the Government has been to support the economy through the outbreak and to minimise the potential for long-term damage or scarring to the economy’s potential. And to do that, to bridge across the period of the shock, we have taken unprecedented fiscal and monetary actions, as well as using our financial stability tools to the full. Those actions were consistent and they were complementary. But – crucially – they were taken independently and in pursuit of each institution’s own policy objectives. This argument in principle is backed up by what has actually happened in practice. Just in terms of scheduling, the MPC’s decisions have largely been taken ahead of rather than in response to Debt Management Office (DMO) announcements. Indeed in June the MPC, acting on advice from the Bank’s executive, agreed, at the same time as adding to the target stock of asset purchases, to substantially slow the pace of purchases, from £ to an initial £ before the DMO published its updated remit, which set out plans for increased issuance.

As for economic outcomes, inflation has been well below our 2% target for the past year, while measures of inflation expectations such as those from financial markets have been stable and consistent with the target – not what you would expect to see if QE was being used for purposes other than our monetary stability objective. In fact it is true that there are links, as I’ll set out, between QE and the Government’s finances – as there are for any of our other balance sheet tools. But these are very different from the charge of “monetary financing” that I have been responding to so far. Instead of reflecting deliberate deviations from our monetary policy objectives, they come down to more prosaic and technical, though very important, and hence understandably a focus of the IEO report, issues of risk management and accounting. Ben’s recent speech “Government debt and inflation” addresses this question comprehensively, as does Andrew Bailey’s recent speech “Modern challenges for the modern central bank”. 21  11  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  11  I’ll start, once again, with the Bank’s own balance sheet. Like any financial institution the Bank holds lossabsorbing capital to insulate it against unexpected losses.