samchain/econo-pairs-v1 huggingface dataset:
By contrast, the inflation outlook has improved appreciably. This has increased the SNB’s room for manoeuvre. Finally, there is a risk that the financial crisis will cause a deterioration in financing conditions for the economy as a whole. These are the considerations that have prompted today’s decision to cut the three-month Libor target range by another 50 basis points. Given the expected deterioration in the Swiss economy and the imponderables linked to the long and variable monetary policy transmission lags, a further rate cut appears appropriate. With this action we are reducing, to the extent possible, the risk of an even more pronounced economic downturn. Inflation forecast chart How has our inflation forecast been revised? The dashed red curve on the chart represents the new forecast. It covers the period from the fourth quarter of 2008 to the third quarter of 2011, and maps the future development of inflation on the assumption that the three-month Libor remains unchanged at 0.5% over the forecasting period. For purposes of comparison, the dash-dotted green curve shows the inflation forecast of the September monetary assessment, based on a three-month Libor of 2.75%. The new forecast shows a rapid fall in inflation over the next few quarters. It drops back below the 2% mark as from the fourth quarter of this year.

Jean-Pierre Roth: Recent economic and financial developments in Switzerland Introductory remarks by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank and Chairman of the Board of Directors of the Bank for International Settlements, at the end-of-year media news conference, Zurich, 11 December 2008. *  *  *  Our assessment of the economic and monetary situation has changed considerably since our last assessment of 18 September 2008. Already back then, we had emphasised that there were substantial risks attached to developments in the global economy, in financial markets and in energy prices. We had also stressed that our forecasts for economic activity and inflation in Switzerland involved considerable uncertainties. We had announced our intention to monitor developments closely, in order to react swiftly should the need arise. As you know, this eventuality did indeed materialise. This led us to relax monetary policy decisively as the uncertainties faded and the deterioration in the economic situation became more concrete. We first lowered the Libor target range on 8 October, by 25 basis points; then on 6 November, by 50 points; and a third time on 20 November, by 100 points. With the new cut announced today, the Libor target range now lies between 0% and 1%, reflecting a firmly expansionary monetary policy. Today’s press conference gives me the opportunity to explain in detail the rationale behind our actions. Since our assessment of 18 September, the situation has changed in three key areas.
In keeping with such aim, the overall policy thrust of banking supervision and regulation will be to promote higher standards of risk management among banking institutions. Towards such end, the Central Bank has already implemented several measures to further strengthen the supervision and regulation and these include: (a)  Introduction of enhanced minimum capital requirements,  (b)  Introduction of the market risk factor in the computation of capital adequacy,  (c)  Introduction of conditions for the quarterly publication of financial performance indicators, and  (d)  Introduction of provisioning requirements in the banking sector to cover potential credit risk. Prudential requirements imposed on banks will also be further strengthened in 2007. This will include the introduction of a general provision on performing advances and increasing the provisioning requirement for non performing loans; increasing the risk weights on residential mortgage loans and ‘other’ loans adopted in the capital adequacy computation; and the revision of the Single Borrower Limit in line with improved risk management by banks. In addition, the Central Bank intends to implement Basel II, the new international capital framework in 2008, with a standardised approach which will help better align a bank’s capital with its risk profile, enhance risk management and increase market discipline due to the need for greater market disclosure. Through such actions, it is expected to enhance the stability of the banking system and thereby provide greater confidence to all stakeholders and the general public.

6  BIS Review 8/2007  Therefore, continued regulatory vigilance and timely interventions would be necessary to avoid and/or mitigate any harmful effects of all such threats. It should also be noted that a continuing high budget deficit could also pose a formidable challenge in the conduct of monetary policy, as such deficit requires borrowings by the Government from the banking system, making it difficult to maintain the monetary expansion along a pre-determined, tight path. As seen from the case studies of many successful countries, rapid infrastructure development is a strong contributory factor towards achieving sustainable high growth. However, the timely mobilisation of necessary resources for infrastructure development while maintaining budget deficits and debt at reasonable levels would be particularly challenging for a developing country like Sri Lanka. At the same time, maintaining a comfortable and reasonable level of foreign currency reserves in order to be able to mitigate the impacts of external shocks is also a challenging task for any developing country. Needless to say, it is vital to manage the foreign reserves at an appropriate level, while ensuring that the exchange rate fluctuations are within reasonable limits, in order to enhance the confidence in the economy. These and other challenges would need to be faced by our country and it is clear that our policies and actions would have to be so designed in order to deal with, and respond to, such challenges if we are to be successful. 5.
U.S. inflation by most measures fell in half to an average for the CPI of about 2.5 percent. This positive inflation performance was more generalized across the major economies, with Europe and most all major economies experiencing a similar slowdown, and Japan, more famously, slipping into sustained deflation. •  Third, U.S. economic performance during this period was characterized by lower overall volatility in growth and inflation. This moderation, economists call it the “great moderation,” was reflected in a reduction in quarter to quarter volatility in output by about half. This more even pattern of growth was evident across most components of GDP. Some of the other major economies also saw some moderation in the variability of macroeconomic outcomes, but the trend is not as pronounced or well established. •  Fourth, productivity growth in the United States accelerated significantly with productivity growth in the non-farm business sector doubling from about 1.5 percent per year in the two decades up to the mid-nineties, to more than three percent on average over the decade since. This acceleration in productivity was not completely unique to the United States, but it has not yet been matched by the other major economies, though that may be in prospect. What accounted for these achievements? This is important to try to understand, because it is important to assessing whether these trends are enduring or temporary, and what types of policies are likely to sustain them.

Timothy F Geithner: A view from the Federal Reserve Bank of New York Remarks by Mr Timothy F Geithner, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Business Council of Fairfield County’s Economic Luncheon, New York, 19 January 2005. *  *  *  Thanks for giving me the opportunity to speak to you today. I want to talk about the American economic agenda. And I want to start by looking back at the last decade or so, and the exceptional economic performance of the second half the 1990s in particular. What were the fundamental underpinnings of those achievements, and what are the principal challenges we face to sustaining those achievements? Let me begin by reviewing quickly what distinguished that period of U.S. prosperity, relative to the past in the United States and relative to the other major economies. There are four things in particular worth highlighting: •  First, over this period of the past decade the U.S. sustained very solid growth in the range of 3.5 percent. This was not particularly exceptional relative to the preceding decade, but impressive relative to the other major economies, most of which saw a sustained slowdown in growth. Japan, for example, saw GDP growth slow from above 3.5 to just over one percent. Europe slowed from just under 3.0 percent to about two percent. •  Second, we achieved very moderate inflation.
Mr. Bäckstrom discusses the economic situation in Sweden Speech by the Governor of the Bank of Sweden, Mr. Urban Bäckström, at a seminar organised by The Swedish Shareholders Association, held in Malmö on 10/10/98. First of all I should like to express my thanks for the invitation to visit Malmö to discuss the economic situation. A major phenomenon in the current economic situation is, of course, the international financial turbulence. The crisis in the Japanese economy has been developing throughout the 1990s and the problems in Asia as a whole are now in their second year. The Asian crisis, which is having widespread real economic repercussions in that region, has in turn accentuated the problems in Russia and, to some extent, in Latin America, with associated contagious effects in Western financial markets. Stock exchanges have fallen around the world and some players in the financial markets have incurred losses. This in turn raises a number of questions about the global economic trend. How negative may the real economic effects become in the United States and Europe? What part are the central banks playing? The US Federal Reserve has recently lowered its instrumental rate and so have other central banks. Will that affect the Riksbank’s actions?

The 75 basis point cut in the ECB main policy rate implemented in late 2011 has been accompanied by little reaction or even an increase of lending rates in countries under stress, whereas there has been a complete pass-through in euro area countries considered by the markets as financially solid (see slide 9). Self-fulfilling equilibria driven by break-up fears The third, and most recent, dimension of the debt crisis has taken the form of investor fears of a break-up of the currency union. Whereas exchange rate risk across euro area countries should have disappeared permanently with the creation of the single currency in 1999, there have been signs, especially over the summer, that investors have started pricing in redenomination risk. Investors require a compensation for the risk that the euro might not remain the irreversible currency of the euro area – at least in its current composition. Although it is difficult to disentangle redenomination premia from other sources of risks – and it requires econometric analysis – the inversion of the slope of the term structure of sovereign bond spreads 5 observed in early summer 2012, for instance, for Spain and Italy was consistent with expectations of imminent break-up risks. Market fears of a high probability of not paying back in full, or of equivalently to repaying in a different, lower-valued currency, command high spreads.
In 2011, the effective policy rate has been the average of the current account rate and the maximum rate on 28-day certificates of deposit. Interest rates were then held unchanged and the neutral bias was retained at the MPC meetings in March and April. In June, however, the Committee indicated that, other things being equal, it was likelier to raise interest rates than to cut them at upcoming meetings, owing to strong wage  2  BIS central bankers’ speeches  increases, marked depreciation of the króna, and rising domestic inflation. Consequently, it should have taken no one by surprise that the MPC should raise interest rates in mid-August, when the Bank’s forecast stated that inflation would gain momentum in coming months and the economic recovery would remain on track. And indeed, insightful analysts predicted a rate hike. In September, interest rates were kept unchanged and the positive bias was kept. It was stressed that the decision did not represent a change in policy. A number of observers speculated that it did, though, perhaps motivated by the increasingly uncertain global situation. This is probably why the Committee’s decision to raise interest rates in November took the market more by surprise than might have been expected. Before I explore the November interest rate decision further, I must mention two things. First, while Iceland was engaged in its IMF-supported programme, exchange rate stability was given priority over the determination of interest rates based on the domestic inflation outlook and economic conditions.

Már Guðmundsson: Monetary policy Keynote address by Mr Már Guðmundsson, Governor of the Central Bank of Iceland, at a breakfast meeting of the Iceland Chamber of Commerce, 4 November 2011. *  *  *  The Iceland Chamber of Commerce has a long-standing tradition of holding a breakfast meeting like this one on economic developments and prospects and monetary policy, following the publication of the Central Bank’s autumn forecast. As before, I would like to thank the Chamber of Commerce for this initiative, as there is a great need for informed discourse on monetary matters. In my speech a year ago, I discussed the progress made in stabilising the economy as is evidenced by the underlying current account surplus, the stable and subsequently strengthening currency, and inflation that was rapidly approaching the Central Bank’s inflation target. I mentioned, however, that robust recovery had not yet taken hold. It seemed to me then that the recovery had begun, and this has since been corroborated. At that time, GDP was projected to grow by just over 2% in 2011 – which was not considered terribly strong in view of the slack in the economy. I was concerned as well about the low level of investment and the prospect of weak export growth in spite of a very low real exchange rate. The inflation outlook seemed much better, though, due to a rising exchange rate and the slack in the economy.
The MPC explained over a year ago that there were “limits to the extent to which above-target inflation [could] be tolerated” and that those limits depended on the degree of spare capacity in the economy. In March, eight months ago, it said in its Monetary Policy Summary that, if demand growth remained resilient, “monetary policy may need to be tightened sooner” than the market expected. Similar points were made in the intervening months. Yet, even as inflation rose, and the rate of unemployment fell further, interest-rate markets continued to under-weight the possibility that Bank Rate might actually go up this year. Chart 1 plots the cumulative change in the three-year sterling interest rate, over the past year or so, against what  Chart 1: Interest-rate markets relatively unresponsive  you might have expected to happen (based  to upside surprises in economic data through 2017  1  on historic correlations) given the pattern of data surprises. There is always room for judgement about any individual interest-rate decision and not everyone on the Committee agreed with this one. After a long period of weak wage growth there’s certainly room for doubt, or at least caution, about the inflationary impact of lower unemployment. (For my part I think  Sources: Bloomberg, Tradeweb, and Bank calculations. the evidence is still consistent with such an inflationary effect and I will say something about this later on.) 1  Cumulative changes in UK 3-year nominal spot rates.

I wondered some years ago 2  whether such effects were at work after the financial crisis . Given the potential reallocative effects of any material change in the UK’s trading arrangements, it’s conceivable they could arise in this case too. Indeed it’s possible they could arise even ahead of the formal date of the UK’s departure. In September/ October a CIPS survey of procurement managers suggested there could be significant unwinding of supply chains through the course of next year: 40% of UK firms who currently use EU suppliers are actively looking for domestic alternatives; the equivalent figure in the other direction – the proportion of European businesses expecting to move away from existing UK suppliers – is 63%. A CBI survey in October found that, in the absence of a transition deal, 60% of firms would begin to activate “worst-case” contingency plans by the end of March 2018, a full year before the UK’s exit. Chart 3: Reductions in supply can add to It’s true that incremental changes in underlying  inflationary pressure  productivity can have knock-on consequences for wages, and for demand, that would blunt their impact on inflation. If in aggregate firms are less productive, they would probably spend less, including on pay awards. But to the extent those knock-on effects lag in any way, firms would also respond by raising prices. In other words, reductions in supply can add to inflationary pressure even as they also lower aggregate GDP. Chart 3 is an extremely stylised description of this effect.
Capotă, L.-D., Giuzio, M., Kapadia, S. and Salakhova, D. (2022), “Are ethical and green investment funds more resilient?”, Working Paper Series, No 2747, November.

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In the United States, the tapering of unconventional monetary stimulus has proceeded as expected, but the financial markets could suffer significant stress episodes if events occur that might anticipate the timing of the announced increases in the Fed funds rate. In particular, in the present context of low long-term interest rates and limited sovereign premiums, there could be a drastic reversal causing important tension. This could have 6  BIS central bankers’ speeches  effects on external funding costs and currency parities, with a heavy impact on emerging economies. Overall, the most likely scenario continues to assume that the US economy will bring a new boost from abroad and a more favorable scenario in the medium term. At home, one risk is domestic output and demand growing less than expected. As noted, the two have weakened beyond projections, coinciding with a widespread worsening of expectations. The baseline scenario estimates that this worsening will reverse gradually, which partly explains the growth forecast for consumption and investment in 2015. However, if such reversal does not occur, there may be a sharper and stronger adjustment in the labor market, which would negatively affect consumption and output. Furthermore, a worsening of business expectations could intensify the investment adjustment. Such a setting could also trigger a more intense rebalancing towards the tradable sector, thus moderating the domestic slowdown.

This sharp deceleration is certainly worrying news, that should move us all, from political and economic venues, to combine our best efforts to restore the dynamism of the Chilean economy, especially considering that, as is our conviction, Chile has all the necessary tools at hand to ensure higher growth and thus improve the welfare of its inhabitants. In this context, the Central Bank has used monetary policy decisively and consistently with its mandate, always directing its efforts to achieving the price stability objective. We are also aware that monetary policy tools, however powerful, can smooth, but never flatten out, the economy’s cyclical fluctuations. What are the elements behind this weak economic growth? Our research identifies some factors that to some degree were expected – we have mentioned them in earlier Reports – and some unexpected ones, with effects that are yet to be assessed with accuracy. The expected factors include external developments. Chile is a small, open economy and, as such, is affected by the vagaries of the world economy. In this sense, and beyond the severe negative effects of the global financial crisis of 2008–2009, we must recognize that during the past decade the Chilean economy was blessed with a benign international scenario, with extraordinarily advantageous commodity prices and financial conditions. Notwithstanding, lately the high commodity price cycle has come to an end, hitting commodity-exporting countries including Chile. Meanwhile, although international financial conditions are still good, the process of monetary policy normalization in some large developed economies is expected to begin soon.
Sustainable growth at its full potential requires that there must be a corporate reform that emphasizes flexible and transparent organization, sound corporate governance, and increased economic value-added through moving up the technological ladders. By so doing, we will be ready for the intensified battles of globalization. And these will be our Corporate Challenges in the New Millennium. So far, Thailand has made much progress in corporate restructuring. As of March 2001, more than 380,000 cases of debt restructuring have been completed, involving the credit outstanding of 2.1 trillion baht. Yet, we must not stop there. The true challenge of corporate reform remains to be tackled, should we want a vibrant and resilient corporate sector to emerge from the crisis. We have to move beyond the financial side of the corporations, move beyond the balance sheet cleaning up, and start to address the real issues that will determine the long-term competitiveness of the corporate sector and thus consolidate the economic recovery achieved thus far. I will not have time to cover all of the important issues of corporate reform, but let me mention a few. Corporate governance will be one of the major themes of an on-going corporate reform around the world in the years to come. By good governance, I mean transparency, competitiveness, and good  BIS Review 41/2001  1  internal management, which include the relationship between the board of directors and managers as well as issues such as shareholder rights, management oversight, and information disclosures.

Thus, Board Members may never be aware of the company’s problems. If and when they have been informed of the problems, it may already be too late, as evidenced in the case of Enron. It is for the above reasons that the authorities here in Asia, are pushing for the separation of Chairman and CEO positions so that they cannot be occupied by the same person in order to properly balance the powers and functions of the two roles. It is also fortunate for us that the practice of issuing stock options to directors of financial institutions is not yet widespread among banks in Asia. Ladies and Gentlemen, What I have highlighted is only one facet, and in fact only half of the story of good governance: that is what NOT to follow. Let me turn to the other issue of the missing link in the Western concept of governance. In the Western World, the focus of the governance structure is to protect the interest of the organization and its shareholders. It ensures that the management or staff would not abuse their organisation for personal gains. However, there is nothing in the Western structure of governance that talks about the need for the protection of consumers’ interests, and, more importantly, the interests of society at large. A corporation that grows sustainably does so because it has earned the recognition of its customers.