samchain/econo-pairs-v1 huggingface dataset:
Hence, we believe that domestic demand will remain on a modest upward track in the final quarter. External demand, on the other hand, remains weak due to Europe’s slowing economy and  BIS central bankers’ speeches  3  geopolitical tensions in neighboring countries. The weak external demand puts pressure on export growth, but the fact that export growth exceeds import growth supports the rebalancing of the economy (Chart 15). Moreover, falling oil prices contribute positively to the current account balance by reducing import expenditures (Chart 16). We expect domestic demand to recover moderately and external demand to remain weak in 2015. Depending on weather and precipitation conditions, the projected correction in the agricultural value-added will be a factor to support growth. However, there are external demand-driven downside risks to growth. Thus, in 2015, demand conditions will contribute to the disinflation process. Although we expect the growth composition to change in favor of domestic final demand, we believe that the current account deficit will continue to improve on the back of the macroprudential measures and the improved terms of trade. As you all know, food, energy and import prices also play a great role in inflation forecasts. Therefore, before moving on to forecasts, I will briefly talk about our assumptions regarding these variables. In the fourth quarter of 2014, oil and import prices remained well below the projections of the October Inflation Report (Chart 17). Accordingly, we revised our medium-term assumptions of oil and import prices significantly downwards.

The tight monetary policy stance coupled with the macroprudential measures continues to improve the core inflation trend (Chart 11). As of the end of 2014, the core inflation trend has receded to 5 percent. The leading recent development, which affected inflation dynamics at most, has been the plunge in oil prices (Chart 12). Amid this decline, annual inflation in the energy group fell remarkably and stood below zero at the year-end. Favorable cost developments driven by plummeting oil prices also contribute to the improvement in the core inflation trend. Briefly, the last quarter of the year was marked by evident effects of the falling oil prices on inflation. A remarkable improvement was witnessed in inflation expectations after a long period and the positive effect of oil prices on the headline inflation spilled over into many subgroups, chiefly the services group. Besides the international price developments that contribute to falling inflation, we envisage that the gradual elimination of cumulative exchange rate effects, the decline in food inflation to past years’ averages and our tight monetary policy stance will support the disinflation process in the upcoming period. Against this background, we project that consumer inflation will register a notable improvement particularly in the first quarter, and inflation will recede to levels consistent with the target in mid-2015. Now, I would like to give a brief account of developments in economic activity and the shortterm outlook on which the inflation forecasts are based.
Notes: Red diamond shows latest observation (for 2017). 25  All speeches are available online at www.bankofengland.co.uk/speeches  25  Chart 16: Distribution of offered wage by occupation, with and without the term ‘self-employment’  Sources: Reed and Bank of England calculations. Notes: ‘SOC code’ refers to standard occupational classification code. The area labelled ‘True’ shows the distribution of offered wages for job adverts which include the term ‘self-employment’, and the area labelled ‘False’ shows the distribution for adverts which do not. The data are drawn from a cross-section of online job vacancies. Distributions are constructed using data covering the period 2008-2016. Chart 17: Distribution of offered wage by occupation, with and without the term ‘flexible hours’  Sources: Reed and Bank of England calculations. Notes: ‘SOC code’ refers to standard occupational classification code. The area labelled ‘True’ shows distribution of offered wages for job adverts which include the term ‘flexible hours’, and the area labelled ‘False’ shows the distribution for adverts which do not. The data are drawn from a cross-section of online job vacancies. Distributions are constructed using data covering the period 2008-2016.

Page 7/10  Chart 1  Chart 2  Page 8/10  Chart 3  Chart 4  Page 9/10  Chart 5  Chart 6  Page 10/10
Bank of England  Page 16  Chart 9: “Excess deposits” have fallen only slightly but households’ overall financial wealth is down sharply  125 120  Household financial wealth relative to disposable income 410 Household M4 (LHS) 390  115  370  110 350 105 100  330  Net financial wealth (RHS)  95  310  90 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022  290  2022 Q3 data points are estimated. Sources: Bank of England, ONS and Bank calculations. But to varying degrees these cushions have since been eroded. The saving rate has fallen sharply and is now around a percentage point below its long-term, pre-Covid average. Most of the excess deposits remain, it seems. But one might ask why they do – why, at a time of significant reported pressure on household finances (when consumer confidence has been setting new record lows), more of them haven’t been spent – and therefore whether it’s realistic to think that they will be in the near future. As many have pointed out, these deposits are probably skewed towards the upper end of the income distribution (and therefore away from those for whom rises in energy prices are the most burdensome). It’s also worth recognising that other household assets have been weakening sharply this year. Despite higher deposits, households’ overall net financial wealth is quite a bit lower than before the pandemic.

Risk analysis and buffer-raising will also be a challenge for Eesti Pank in the forthcoming periods. The central bank just finished its first year as a member of the euro area, with one of the lowest equity to monetary policy assets ratios among euro area central banks. We must bear in mind that the revenues and expenditures of monetary policy operations are shared within the Eurosystem in proportion to the central bank’s participation in the total capital. The Supervisory Board of Eesti Pank thus resolved to raise the central bank’s capital adequacy ratio to the average level of euro area central banks in the long term. In order to bring the ratio into line with Eesti Pank’s participation in the Eurosystem, the capital adequacy ratio must be raised. This means that the central bank’s equity must be raised from 0.37 billion euros to approximately 1.3 billion euros. Eesti Pank’s equity currently stands at 0.07% of the Eurosystem’s total equity, while Eesti Pank’s participation in the Eurosystem stands at 0.26%. [QUO VADIS, EURO AREA?] 1. It is not only the central banks that can contribute to a successful exit from the crisis – the governments of member states must, as soon as possible, implement the measures taken and agreements made by the European Council and the euro area heads of state and government. Closer cooperation in the field of economic policy, along with clear-cut, functional rules, serve the interests of all members. 2.
Whereas two years ago we were trying to fight off heavy appreciation pressures against the krone, we have since last summer seen quite the opposite tendency. Last year, the krone exchange rate moved on a weaker trend, in spite of continued government budget surpluses and our still relatively healthy current account. As downward pressure on the krone grew, Norges Bank raised its key rates in seven steps last year, in line with its mandate to stabilise the krone exchange rate. In the course of five months, key rates were raised by a total of 4½ percentage points. In spite of this, the krone has been weaker than its initial range vis-à-vis European currencies since last August. In this situation, the focus of monetary policy must be to adjust fundamental factors in a way consistent with a return of the krone to its target range. Of course, monetary policy can do nothing to reverse the terms-of-trade shock brought about by the steep fall in BIS Review 16/1999  –2–  commodity prices. However, the aim to stabilise the krone against European currencies implies that inflation over time cannot deviate from the inflation in these countries. If inflation is brought in line with inflation in the euro area, a return of the krone to its initial level becomes more likely. Thus, in the current situation Norges Bank must focus on relative inflation when setting interest rates.

These trustees have a legally binding obligation to exercise all of their rights as majority owner of AIG in the best interests of the U.S. taxpayer, with the proceeds of any ultimate sale of shares going directly to the Treasury of the United States. Efforts to reduce risk at AIG Financial Products As has been widely noted, the activities at AIG's Financial Products unit (FP) were a principal cause of the losses that drove AIG to the brink of bankruptcy in September 2008. Risks of substantial magnitude – including derivatives positions with a current total notional value exceeding one trillion dollars – still remain in force at FP, meaning that not millions but billions of taxpayer dollars are potentially at stake as the orderly wind-down of FP continues to progress. The winding down of these risk positions at FP is a delicate and complex matter with systemic implications for the U.S. and global economy. Our oversight of this riskreduction process remains a top priority.
On the basis of the 2018 European-wide stress test data, we estimate that the banks’ behavioural reaction to the adverse scenario exacerbates the fall in GDP by a further 1.6% with respect to the initial shock, which itself further depletes banks’ capital.7  Cyclical factors Given that important link between bank behaviour and the cycle, let me turn to the cyclical factors affecting bank profitability in the euro area. The economic expansion continued through 2018, although with a sizeable reduction in the pace of growth relative to the previous year. Since the trough, the number of people in employment has increased by over 10 million. While the data since the end of 2018 have been weak – notably in manufacturing and the external sector – the economic fundamentals remain in place to support continued expansion. The economic expansion and employment growth have supported bank profitability. Loan growth has been robust in recent years, with higher volumes helping to mitigate margin compression.8 The stock of non-performing loans (NPLs) has been substantially reduced. Outstanding NPLs fell by € billion in 2018 and the aggregate ratio dropped to 3.8% of significant banks’ loans at the end of 2018, from 7% at the end of 2015. NPLs represent a double drag on bank profitability. First, NPLs have to be recognised and provisioned for, reducing current profitability. Indeed, the major driver of the increase in bank profitability over the past two years has been the smaller flow of new impairments.

That requires substantial investment in information technology (IT). The best performing euro area banks I mentioned earlier increased their IT spending by around 60% between 2009 and 2017, whereas the remaining banks increased theirs by just 10%. Such investment is expensive, but has proven worthwhile. The cost-to-income ratio for the median of the best performers fell by 5.5 percentage points, whereas that for the median of the other banks increased by 3.1 percentage points.12 The other source of higher costs for euro area banks is the adjustment to a suite of post-crisis regulation. This includes holding greater amounts of high-quality capital and debt instruments that can be “bailed in” should resolution become necessary. It is also more difficult now to increase measured profitability by increasing leverage. And whilst international requirements on loss absorption only apply to the most systemic banks – so-called G-SIBs – and the Basel standards typically apply to internationally active banks, in the euro area such requirements are applied to all banks. Of course, such regulations have been put in place in recognition of the significant public costs borne throughout the banking crisis. And regulation cannot be seen as the main driver of costs – Nordic banks operate under the same regulatory framework and have been able to attain a high rate of profitability. But one key element in regulation worth noting is the lack of waivers for liquidity and capital in the euro area.
On the costs side, the digital transition involves preparing for shifts in jobs and in skills, through enhanced dialogue with social partners. Moreover, it calls for major IT investment aimed at providing services that remain aligned with customer needs, reducing structural costs and improving regulatory compliance. IT systems will need to be – and this is far from simple – more secure so that they provide strong protection against cyber-risks, but at the same time more flexible and open to interconnectivity. Our duty as regulators in this revolution is obviously not to discourage innovation, but to ensure a level playing field with FinTechs – taking into account their lifecycle according to a “proportionality principle” – and still more tomorrow with bigger data platforms, be they GAFAs or their equivalents. This level playing field will have to apply for capital or liquidity requirements, for prudential supervision as well as for data protection: if you play the same game, you have to obey the same rules. 3/9  BIS central bankers' speeches  In addition to adjustments to business models, cross-border bank consolidations in the euro area would also help tackle this efficiency issue. The Banking Union provides both the justification and the framework for such a financial integration – we still lag far behind the American market in this respect. Cross-border consolidations on a sound and safe basis would make banks better able to diversify their risks across the euro area, and channel savings more effectively towards investments across borders.

François Villeroy de Galhau: The future of the finance industry between austerity and innovation Speech by Mr François Villeroy de Galhau, Governor of the Bank of France, at the Süddeutsche Zeitung Finance Day 2017, Frankfurt am Main, 22 March 2017. * * * I am grateful to Marine Dujardin and Banque de France and ACPR staff for their assistance in preparing these remarks. It is a great pleasure to be with you today and I’d like to thank you sincerely for inviting me. I am here in Frankfurt as a committed European and as a friend of Germany; and not just because I travel here at least once a fortnight for the meetings of the ECB Governing Council! On a more personal level, I am French but my roots are in Saarland. My family has lived there since the end of the 18th century and its porcelain manufacturing company Villeroy & Boch is part of the German “Mittelstand”. But today, to discuss the future of the finance industry, I’m going to be talking in my capacity as a member of the Governing Council and President of the French supervisory authority (the ACPR, which I’m sure some of you know). First I would first to say a few words on the Eurosystem’s monetary policy and our latest decisions. Then I’ll share with you my thoughts on how to respond to the current challenges facing the finance industry.
The objective is to equip market participants with better information, let them take responsibility for making their own decisions and to judge the quality of the corporate governance of companies. But a disclosure-based approach can only work well if it is backed up by a robust enforcement regime. This is key to maintaining the confidence of market participants in the disclosure-based regime. In recent years, our regulatory authorities have acted decisively in the face of breaches by market participants, such as in the cases of ACCS, Citiraya and China Aviation Oil. Equally important for a disclosure-based regime is the raising of the bar on corporate governance standards themselves. Singapore’s approach here is a flexible one, recognising the need to cater to a range of companies of different sizes and resources. It comprises a balance of mandatory rules, captured in our legislation and listing rules, and best practice recommendations in the form of the Code of Corporate Governance. Listed companies are required to either adopt the best practice recommendations or to disclose instances where they have not done so and provide explanations for these – in other words companies must “comply or explain”. We will keep both our legislation and best practice codes up to date through regular refinement, so that they stay relevant to a changing environment. We will also keep close watch on developments internationally, to see if they might be relevant to the Singapore environment.

For now, let me highlight two particular areas of the study’s recommendations that we have started working on. Professional development and training of directors One area of improvement is in the training of directors. Having committed and skilled directors is a key component in the effective functioning of the board. Director training is particularly relevant for new or first-time directors, to assist them in understanding their roles and responsibilities, and to equip them with the necessary skills. Even experienced directors need to continually upgrade their skills, to oversee and steer companies in today’s rapidly changing and globalised landscape. MAS has been in discussion with the Singapore Institute of Directors on how we can build on its very useful work to date, and develop a comprehensive and sustained approach to training and development of directors in Singapore. MAS will help to fund a study that will help to operationalise this comprehensive approach to training. The study will cover a few areas. First, it will look into benchmarking directors’ training and development against best practices in other leading jurisdictions. A number of jurisdictions have in the last few years developed extensive structured training programs for directors. Secondly, it will examine possible collaborative arrangements between a range of organisations and training providers. Thirdly, it will also focus on how best such training initiatives should be financed.
Macroprudential and monetary policy instruments must be coordinated The interaction between macroprudential policy and monetary policy instruments means that it will be necessary to coordinate their use. This is for three reasons. Firstly, there is a danger of the instruments conflicting if they are implemented in an uncoordinated manner by authorities with different objectives. This has been shown to lead to a “push-me, pull-you” problem in which monetary policy and macroprudential policy instruments are used more aggressively, in opposing directions, leading to a worse outcome than if the instruments had been coordinated. 10 Secondly, in most cases, monetary policy and macroprudential policy instruments should reinforce, not conflict with, each other. But it will still be necessary to monitor and understand the overlap between the instruments to ensure optimal policy. Thirdly, in some extreme situations, the use of instruments usually prescribed for monetary or macroprudential policy will be insufficient to meet their respective policy objectives. In such situations, monetary and macroprudential policy instruments will be required to work in tandem to meet the policy objectives. Close coordination will be needed to guide use of the tools in these circumstances, as the distinction between the objectives of the instruments will be blurred.

Survey of Consumer Expectations So a second important example of data innovation at the New York Fed is the Survey of Consumer Expectations, which we introduced to the public just last month. Consumer expectations of future economic outcomes are crucial inputs to the policy process, but we felt that our standard measures of these expectations were quite limited. The primary goal of this new national survey is to collect timely, rich, and high-quality information on consumer expectations about a wide range of household-level and aggregate economic and financial conditions. The survey covers expectations about inflation, price changes for specific goods, home price changes, future wage growth, future quits and layoffs, and residential mobility, as well as expectations of household income, spending, taxes, and credit access. The SCE has two advantages over existing surveys of expectations: It collects information about consumers’ expectations and decisions on a broader range of economic and financial topics, and it does so in a way that captures respondents’ beliefs more fully. The objective is to measure an individual’s beliefs about the likelihood of future outcomes, thereby capturing how certain or uncertain the person is about future events. In some cases, we do this by eliciting a “density forecast,” where respondents are asked to assign a percent chance to  BIS central bankers’ speeches  3  different values (or intervals) for the outcome of interest.
If monetary policy helps to restrain the build-up of financial imbalances, this may also mitigate the risk of severe economic downturns further ahead. The extent to which explicit weight should be placed on financial stability in interest rate setting is state-dependent and must be based on an overall assessment of the outlook for inflation, output and employment. In many situations, financial stability considerations will pull in the same direction as the objectives of price stability and real economic stability. If the economy is booming, with prospects for high inflation and a risk of a build-up of financial imbalances, monetary policy tightening will accommodate all the considerations above. Likewise, lowering the key policy rate in response to a severe downturn with increased bank losses will contribute to sustaining activity and limiting bank losses. In other situations, the different considerations will pull in opposite directions. If there are prospects that inflation will be too low amid rising debt and house prices, it may be appropriate to give weight to real economic stability considerations and bring inflation back to the target somewhat more slowly. In recent years, Norges Bank has kept its key policy rate somewhat higher than implied by a short-term goal of inflation and output stability would in isolation suggest. This has occurred in an environment of low global interest rates and where a build-up of financial imbalances has increased the likelihood of inflation, output and employment volatility further out.

Zeti Akhtar Aziz: Banking on Islamic finance – from legality to economic value Keynote address by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the 8th World Islamic Economic Forum (WIEF) “Banking on Islamic finance – from legality to economic value”, Johor Bahru, 6 December 2012. *  *  *  Powerful forces of change are transforming the functioning of the international financial system and the global economy. In the aftermath of the global financial crisis, the quest has been to build financial systems that will best serve the real economy, that provides financial intermediation that promotes sustainable growth through productive and responsible innovation, and that will be resilient to shocks and less prone to crisis. There is tremendous potential to draw on the economic value that Islamic finance has to offer. In realising this potential, in a now more challenging environment, will depend on our capacity to build new capabilities that will unleash the inherent intrinsic value propositions of Islamic finance that supports and energises the real economy. It is my honour to participate in this 8th World Islamic Economic Forum in my hometown, Johor Bahru to speak on the topic “Banking on Islamic Finance: From Legality to Economic Value”.