samchain/econo-pairs-v1 huggingface dataset:
M R Pridiyathorn Devakula: India and Asia - trade linkages and alliances Remarks by Mr M R Pridiyathorn Devakula, Governor of the Bank of Thailand, at the Wharton Global Alumni Forum, Mumbai, 6 January 2006. *  *  *  Dean Harker, Mr. Ambani, Ladies and Gentlemen, I am honored to be here today among friends and associates of the Wharton Global Alumni. Given that it is the first time that the School is organizing the Forum in India, it seems only fitting that we should be talking about the rise to prominence of India as an engine of growth, both in the region and globally. More importantly, I would like to highlight the potential for India’s trade and investment linkages with East Asia, and how the two regions of South and East Asia can leverage on one another and become a global force to be reckoned with. China and India, Asia’s two largest economies, are often hailed as potential growth areas and the new engines of growth for the world. China’s rising economic prominence has been particularly evident in the past decade and a half, with its gross domestic product (GDP) in purchasing power parity (PPP) terms, measured as a share of total world GDP, rising from 5.7% in 1990 to 13.6% in 2005. India, although coming later into the scene, has quickly caught the attention of the world as a potential global economic powerhouse.

But the reform process in East Asia has proven to be worth the efforts, as you can see from the fast growing intra-regional trade. Many of these reforms remain to be completed, and we need to continue to press on with the reform agenda. But the changes from now on should not be as difficult, as public sentiment is supportive of the benefits of these reforms, in terms of the increased efficiency, predictability, and transparency to businessmen and entrepreneurs, both domestic and foreign. One just needs to cross that threshold. Thank you for your attention. BIS Review 7/2006  3
Very significant valuation losses this year As a result of a rapid increase in inflation this year, the Riksbank and other central banks have raised their policy rates. The level of interest rates today is significantly higher than at the start of the year. The value of the bonds in the Riksbank's monetary policy-motivated asset portfolio has therefore fallen considerably; Table 1 shows that the value has decreased by SEK 59 billion this year, corresponding to one per cent of GDP. Table 1. Changes in value of Riksbank’s monetary policy assets this year Government bonds Municipal bonds Covered bonds Corporate bonds Total  −32 −6 −21 0 −59  Note. SEK billion. Refers to change in value up to 30 November 2022. 31 The Riksbank's accounts actually follow a hybrid of these two principles. If the market value of an asset is less  than the acquisition value, the difference is recognised as a loss, but if the market value exceeds the acquisition value, the difference is transferred to a revaluation account without affecting the Riksbank's reported result. Kjellberg and Åhl (2022) describe this in a little more detail. 17 [30]  During a large part of the purchasing programme's history, interest rates were surprisingly low. The acquired assets have then increased in value and the Riksbank's financing cost has often been slightly lower than we expected at the respective purchase occasion.

Despite this, one could see that the support measures had had the effects on risk premiums and housing prices I described above; the risk premiums were lower than before the pandemic and housing prices had started to rise clearly, after falling during the start of the pandemic.27 It is not possible to say with certainty how the economy would have developed if we had not decided in November 2020 to extend and prolong the asset purchase programme. As the pandemic still had a significant impact on economic activity and contributed to market uncertainty, continued support measures were justified. However, the financial markets were functioning well and the yield curve was low and flat. The asset purchase programme that we had already decided and which was due to run until mid-2021 seemed, in my view, sufficient to deal even with increasing uncertainty.28  Rapid rise in inflation and a reversal of monetary policy 2022 Inflation has risen rapidly this year and is now far too high. The Riksbank has therefore raised the policy rate, and other interest rates have followed. The higher interest rates mean that the value of the assets we have purchased falls and that the Riksbank will report a large financial loss this year  25  Many central banks supported the markets through asset purchases during the pandemic. Norges Bank is one of the few exceptions.
Today, there are no signs of a financial bubble, but we are ready to act, if necessary, by implementing macroprudential measures, in the framework notably of the Haut conseil de stabilité financière (High Council for Financial Stability – HCSF) that you created via the Banking Act of 2013. For instance, at our eighth meeting held on 15 March 2016, we issued a warning about the office sector in the Paris area. BIS central bankers’ speeches  1  2. Monetary policy thus contributes greatly to our economy, but it can’t do everything. It cannot be the only game in town. It is vital that Europe and France seize this opportunity now. In France, growth is expected to be both robust and inadequate: Robust, as it should remain in 2016 at least at the 1.2 percent level observed last year. But inadequate, as it will probably linger a little below the euro area average of 1.4–1.5 percent. For growth and employment, three essential actions are necessary: reforms in France; private and public investment; the coordination of economic policies in Europe. First, in France, orderly and sustained reforms are needed to rebuild confidence. Keeping our public deficit and our debt under control is a contributing factor: the good figures published on Friday (deficit reduced to 3.5% in 2015) are another reason to strictly respect our European commitments by bringing it below the 3% limit in 2017.

François Villeroy de Galhau: Present challenges for France’s central bank Hearing of Mr François Villeroy de Galhau, Governor of the Bank of France, by the Senate Finance Committee, Paris, 30 March 2016. *  *  *  Madam President, General Rapporteur, Senators, Thank you for receiving me this morning, just a few months after your vote of confidence. I attach great importance to these regular exchanges in order to inform you of matters essential to the Banque de France. In 2016, the world in general, and Europe in particular, are experiencing a period of uncertainty: uncertainties relating to our security, with the threat of terrorist attacks still real; political uncertainties, with the risk of “Brexit” and the refugee crisis; as well as economic uncertainties, with lower economic growth in emerging economies, including China, and excess market volatility in January and February. Faced with this turmoil, the Eurosystem, of which the Banque de France is a member, is acting decisively. Its monetary policy is supporting the economy and creating a favourable environment for taking all the other actions necessary to return to strong, sustainable and job-creating growth: France, and Europe, must seize this opportunity to regain confidence. 1. Monetary policy, first of all, is doing its fair share of the work. The Eurosystem is determined to fight the low inflation that we are facing today and thus underpin economic activity. This is our mandate and we are striving vigorously to achieve it.
So, allow me to proceed to look more closely at the determining factors behind long-term growth and see how they have developed historically and what can be said about future developments. I shall begin with labour productivity. Productivity growth Figure 2 shows the annual change in labour productivity, measured as GDP per hour worked, together with an estimate of the long-term trend. At the bottom of the figure is the average rate of change during different periods of time. We can see that productivity growth is nearly always positive and varies considerably from year to year, but also that it has had a tendency to increase over time, particularly during the 1990s. This is a clear difference compared with the previous decade. On average, the increase in productivity was 1.2 per cent during the 1980s. During the 1990s, there was a rapid increase and productivity growth reached an average level of above 2 per cent. This average subsequently remained at that level for the remainder of the period. What is the reason for this more favourable development? We do not have any certain answers, but there are still some factors that have most probably contributed to this development. To begin with, we must remember that the Swedish economy underwent a severe crisis at the beginning of the 1990s and this probably contributed to raising productivity growth during the first half of the decade. Many companies went out of business during the crisis; companies with relatively low profitability.

3  Mean working time is calculated here as the number of hours worked according to the National Accounts divided by the number of people in work according to Statistics Sweden’s labour force survey. BIS Review 64/2004  5  leave together cannot be broken. Labour force participation and the degree of employment seem to have attained a lower level following the 1990s crisis. Unemployment also varies considerably between occupational categories and different parts of the country. This indicates that there are structural problems and that the functioning of the labour market and the social insurance system must be improved. The conclusion that can be drawn is that the weak growth in employment is not mainly due to low demand in the economy - although economic activity has not been favourable recently. There is thus no point in seeking the answer to these problems in stabilisation policy. It is structural policy measures that are needed to improve the functioning of the labour market. There are a number of projects there that could contribute to raising the labour supply, at least in the medium term. As I understand it, these include both general measures to increase the labour supply among all groups in the economy and specific measures to increase the supply among certain groups where there may be a greater potential for increases. What can be done to increase the labour supply? Economic incentives can affect individuals’ participation in the work force, but economic theory alone cannot always determine which effects they will have.
History has shown that it is socioeconomically efficient that the government authorities have a monopoly on issuing cash, as this then becomes a risk-free asset that can be used both as an arithmetical unit and for saving and for making transactions. Almost all countries now have central banks that issue banknotes and coins. In Sweden, we are now facing a historical milestone with regard to cash. The use of banknotes and coins has declined at a very rapid pace in recent years and the general public are increasingly using digital means of payment instead. However, there still remains a fundamental requirement for a safe instrument that can be used as an arithmetical unit and to make payments and as a store of value. A critical issue, in light of this development, is what the role of the state should be on the payment market. This is an important issue to society that contains many dimensions, including consumer issues, financial stability perspectives, contingency planning and competition aspects. The Riksbank is therefore investigating whether we should issue a digital krona, or e-krona, so that there will continue to be a means of payment issued by the Riksbank. In addition, the position of cash in the economy and the Riksbank's responsibility for the handling of cash need to be investigated further and specified. Responsibility for RIX – the Riksbank's system for largevalue payments The Riksbank can already be said to issue digital money, but this can only be held by banks and some other financial institutions.

This is money we could have used for consumption and welfare. And let us remember that this is just one of the effects. Add to this the reduction in wealth in the form of falling values of companies, financial instruments and other assets. Contagion effects in a globalised financial market The origins of the crisis lay in US subprime mortgages. Although Swedish banks had very little exposure to this type of asset, the crisis nevertheless affected them. Like the Swedish economy as a whole, the Swedish financial system is very dependent on other countries. For example, only half of the banks’ funding is deposits from private individuals, companies and institutions in Sweden. The rest is borrowed on the market, and a large part of this on international markets. Moreover, most of the funding is relatively short term. This is not unique to Sweden. The advantage is that it reduces the banks’ funding costs, which in turn  2  BIS Review 159/2010  makes it cheaper for households and companies to borrow money. But there are also disadvantages. As the banks have made themselves more dependent on the outside world, they have of course become more vulnerable to problems arising abroad. When the international money markets slammed on the brakes in autumn 2008 the Swedish banks’ funding was immediately affected. Not least because they had borrowed money in the short term. So unlike the crisis of the 1990s the crisis we have just experienced is largely an imported one.
Such a long balance sheet would have made further monetary policy measures substantially harder. At the same time, we would have jeopardised the fulfilment of our mandate in the long term, since reabsorbing such a huge volume of liquidity once monetary policy began to normalise would have been very difficult. At its monetary policy assessments, the SNB had analysed the costs and benefits of adhering to the minimum exchange rate. On the basis of this kind of analysis, the Governing Board concluded, on 15 January, that a minimum exchange rate of CHF 1.20 per euro was no longer sustainable, and thus justified, from a monetary policy point of view. If it had ignored the changes in the international environment, the SNB would have jeopardised its credibility. It would have been irresponsible to maintain the minimum exchange rate even longer and thoughtlessly accept the high costs of this policy, without considering its sustainability. Once we had reached this conclusion, swift action was necessary. Holding off any longer would have increased pressure on the minimum exchange rate because of mounting speculation. Had we delayed the discontinuation, the turmoil on the financial markets would have been no less severe. However, the impact on the Swiss economy would have been stronger and the losses on the SNB’s balance sheet would have been greater. Ladies and gentlemen, the decision of 15 January has far-reaching consequences and was anything but easy for me and my colleagues on the Governing Board.

Consequently, the interest rate differential between investments in foreign currencies and those in Swiss francs had declined to almost zero towards the end of last year. This made the Swiss franc even more attractive for investors. The Swiss franc is equally attractive to both domestic and foreign investors. The upward pressure on the Swiss franc is not only due to the fact that foreigners want to invest in the Swiss franc, but also because Swiss residents invest less abroad or repatriate their international investments. Allow me to explain this in more detail. For a long time, Switzerland has had a current account surplus, in other words, it exports more goods and services than it imports. In addition, the high level of international investments earns significant investment income. Due to the current account surpluses, Switzerland has built up considerable foreign assets over time. These asset holdings abroad were largely invested in foreign currencies, partly because of the more attractive returns. 1 The net revenue earned with the current account surpluses has to be “re-exported” in the form of foreign securities purchases or investments abroad. In the years before the financial crisis, inflows attributable to the current account surplus were more or less balanced by outflows in the form of private capital exports. Following the financial crisis, the situation changed completely. Risk appetite in Switzerland reduced sharply. Investment of the proceeds from the current account surplus abroad by the domestic private sector has become increasingly restrained.
Of course, that does not mean you are expected to build a new Romanian state as they did, but you can certainly act as a similar vector of change in the Romanian society, be it in social values, politics, economy or culture. Therefore, no pressure … Now, some of you must surely be wondering what a central banker like me and IT have in common. I could hardly be described as an IT expert, but I am following developments in the sector, not only because they matter in the global economy (explaining a good deal of the productivity wedge between the US and EU starting in the mid-nineties, for instance), but also because the IT&C sector is increasingly relevant for the Romanian economy – its share in GDP is now nearing that of construction and its contribution has become instrumental in building a surplus on the 1/4  BIS central bankers' speeches  international trade in services. Solid technical skills, good command of foreign languages and certain versatility are assets that continue to attract investment in this sector in Romania. Although infrastructure quality, in general, is not a strongpoint for Romania, communication infrastructure is – we are enjoying some of the best speed for broadband internet connection in the EU if not in the world, not to mention that access is comparatively much cheaper.

The indicator, expressed as a ratio to the EU28 average (the UK still included), currently stands at close to 57 percent (after around 41 percent in 2007 and just over 25 percent in 2000). There is still very much room for progress. I say this having in mind the GDP per capita gap that is still substantial (and larger than those of most regional peers). In a scenario where Romania experiences constant 5 percent growth each year, while the EU grows on average only by 2 percent, it will take us 20 years to achieve full convergence. Under more pessimistic scenarios, I guess you don’t want to hear how long it would take to catch up. At this point, some of you may wonder why would anyone be pessimistic if local output currently grows at over 5 percent, at 6 percent in fact, in the second quarter of 2016, the highest rate in the EU? Well, as the effects of the recent fiscal stimulus wear off, GDP dynamics will come down, while additional stimulus, if implemented, will put even more at risk the already weaker fiscal position. Above all, growth needs to be achieved in a sustainable fashion, backed by productivity and while keeping fiscal and external deficits in check. The lessons taught by the most severe teacher of all, the economic crisis, should not be wasted… When I am talking about much room for progress, I am also referring to developments sometimes overlooked, especially if one has in mind only the aggregate figures.
This pragmatic view is consistent with the idea that monetary policy decisions should be based not only on the most likely scenarios but also on other, less probable ones which, however, may have far-reaching implications  2  BIS Review 53/2006  for the entire system should they materialise. Certainly, an abrupt asset price correction pertains to this class of low-probability event that may ultimately entail significant costs for a country’s welfare. More importantly, to place this approach to monetary policy in its right place, it is critical to recognise that some of the risks inherent in the financial sphere should first be the subject of an appropriate prudential framework. It is no exaggeration to say that any concern about unbalanced market developments is, at core, a concern about a problem of inappropriate risk management. This statement applies to the case in which, due to over-optimism or short-sighted behaviour, market participants fail to appreciate the true risk of their investment or lending strategies. Yet even if their behaviour can be thought as being fully rational from an individual perspective, nothing ensures that the final outcome will not convey important risks at a systemic level that are not properly internalised by single agents. As a result, a portion of the marked volatility and procyclicality of some key financial variables, like asset prices and credit, may be understood as a reflection of individual and collective risk misjudgement.

Moreover, although nominal interest rates may be at very low levels, if inflation continues falling, real interest rates will trend upwards, contributing to reducing consumption and investment. Secondly, in economies posting a high level of public or private debt, or both, very high or rising real interest rates may exacerbate the difficulties of bringing about a reduction in household, corporate and public-sector debt, the reason being that the stock of debt, though it holds constant in nominal terms, will rise in real terms. The macro adjustment of a highly indebted economy in an environment of very low inflation or, indeed, deflation, thus becomes difficult and complex. And, thirdly, in relation to financial stability, the events we have seen in recent years indicate that asset price bubbles and the misallocation of financial resources may coexist alongside low inflation. If the situation of low inflation extends over time and draws close to deflation, we will arrive at very low or even negative interest rates, and that will entail additional risks for institutional investors, for the allocation of resources and for the sound functioning of the financial system. This was what we experienced in the euro area in the second half of last year. What role can monetary policy play in such a scenario? In September 2014, the ECB decided to expand the tools available to monetary policy by adding a private asset purchase programme followed, in January this year, by public-sector and public debt purchases.