samchain/econo-pairs-v1 huggingface dataset:
Within the framework that I have drawn up so far, we forecast inflation, with 70 percent probability, to be between 4.1 percent and 6.9 percent (midpoint 5.5) at the end of 2008, and between 1.8 percent and 5.5 percent (midpoint 3.7) at the end of 2009 (Figure 15). The forecasts are based on the scenario in which policy rates display a limited decline in 2008. Main message of the forecast is that continuation of the gradual easing cycle that started in 2007 September will remain conditional on favorable data and developments. In that sense, the current policy stance envisages a more moderate decline in policy interest rates than indicated in the previous Inflation Report. I would like to emphasize once more that any new data or information on the inflation outlook may lead to a revision in the future policy stance of the Central Bank. Therefore, the policy path that was indicated above should not be perceived as a commitment on behalf of the CBRT. BIS Review 20/2008  11  4. Risks and monetary policy  Distinguished Guests, I would like to dedicate the last part of my speech to the upside and downside risks to the inflation and monetary policy outlook in the upcoming period. The main upside risk factor for the current medium term inflation outlook pertains to the potential second round effects of the accumulated supply shocks, which may also create a higher than expected inflation inertia, as currently manifested in the medium term inflation expectations.

In turn, higher real interest rates tend to depress economic activity and bring even lower inflation. This is the kind of spiral, possibly leading to deflation that monetary policy must seek to control and avoid. The process may become even more self-sustaining if it negatively affects inflation expectations. Over the last months, inflation expectations in the euro area have dropped to 1.2% at a one-year horizon and 1.5% at a two-year horizon. More worrisome, long-term expectations – up to now extremely well-anchored around 2% – have been drifting downward. Markets currently expect an inflation rate of 1.8% on average between 2019 and 2024 in the Eurozone. Monetary policy therefore must aim at influencing both nominal interest rates and inflation expectations. This is exactly what we are currently doing in the Eurosystem. Let me explain how. First, on nominal interest rates: Policy rates are now close to zero (%). Negative interest rates have been imposed on the deposit facility. Forward guidance has been used to signal that rates will stay at those levels for a very lengthy period of time. A new liquidity facility, the “targeted very long term refinancing operation (TLTRO)” has been created, with a four-year maturity and, for the first time, a guaranteed fixed rate. Basically, banks are able to get a four-year funding for a 0.15% fixed interest rate. Most recently, the ECB Governing Council has decided a program of private asset purchases, for both covered bonds and ABS.
Considering the historic dimensions of the money market crisis, the three-month Libor managed to return remarkably quickly to the target range – just one day after the two interest rate reductions of 6 and 20 November the Libor had already moved into the new range in both cases. The turmoil in the money market prompted the SNB to conduct money market operations to an extent that had never before been witnessed. There were days when up to five auctions were held. The volume of the operations varied considerably. On record days, we carried out operations worth over CHF 100 billion. The reason for these sizeable operations can be found in our interest rate management – we first inject large amounts of liquidity into the market and later absorb it again. Until just a few weeks ago, the liquidity actually remaining in the system was not considerably higher than before the crisis. It was not until the SNB adopted a policy of very low money market rates that the sight deposit balances increased markedly. The low interest rate level means that the opportunity costs for banks to hold  2  BIS Review 157/2008  liquidity are lower, thus prompting them to hold more money in sight deposits. The extent of the money market operations also has a major impact on the size of the SNB’s balance sheet. Before the crisis, approximately CHF 20 billion of the balance sheet went towards monetary policy; today, we are looking at around CHF 80 billion.

In recent weeks, the SNB has pursued a policy which has brought the repo rates close to zero. This does not mean, however, that our monetary policy will cease to transmit further expansionary impulses. In addition to the short-term repo rate, we use a whole range of other methods to pursue a more expansionary monetary policy. We can, for instance, extend the maturities of our money market transactions or intervene in markets other than the money market. Updates to monetary policy instruments The SNB’s monetary policy instruments have fared quite well since the onset of the crisis. However, a review has highlighted two areas in need of adjustment. First, a liquidityabsorbing instrument was found to be necessary, and second, the conditions of the liquidityshortage financing facility were no longer deemed appropriate. The liquidity-shortage financing facility serves to bridge unexpected, short-term liquidity bottlenecks. It can only be accessed if a bank has a corresponding limit and if that limit is fully covered by securities at all times. Let’s start with the liquidity-absorbing instrument: The crisis has made it clear that a central bank must be able to offer large quantities of liquidity at short notice and do so via a number of channels and with different maturities. Repo transactions and foreign exchange swaps meet these requirements very well. However, the SNB lacked a separate liquidity-absorbing instrument to handle large volumes. We therefore introduced our own debt certificates – SNB Bills – to our range of instruments in October.
This provides a tool that allows Fed officials to tighten monetary policy and raise private sector interest rates by raising the rate paid on excess reserves. Some skeptics note that when interest on excess reserves was first implemented, the federal funds rate traded somewhat below the rate on excess reserves. This has created worry in some quarters that paying interest on excess reserves might not work very well as a tool for controlling the federal funds rate. On this issue, two points are warranted. First, the relatively large gap between the interest rate on excess reserves and the federal funds rate was due, in large part, to the impaired condition of the banking system, which inhibited the willingness of banks to arbitrage that gap. Because balance sheet capacity was scarce, banks were reluctant to use their balance sheets to purchase federal funds at a slight discount to the interest on excess reserves rate. As the banking system returns to health, this arbitrage is likely to become more attractive, causing the gap between the interest rate on excess reserves and the federal funds rate to narrow. Second, the Federal Reserve could alter its monetary policy framework in order to increase its control of monetary policy in a large excess reserve environment. It is beyond the scope of this speech to get into the details, but we have plenty of options in devising incentives for banks to hold reserves at the Fed that would improve our ability to control the federal funds rate.

I am certain that over time these places will be your most profitable centers as places like Lusaka will only yield narrow margins due to stiff competition. Chairperson, Zambia’s economy has shown some resilience in the midst of the global economic crisis. As you are aware, the economy has posted some marked improvements in macroeconomic indicators in 2009 with GDP growth estimated at 6.3%. Both inflation and the yield rates on Government securities have edged downwards while the exchange rate of the Kwacha against major international currencies has also shown some stability in the recent months. It is for this reason that I reiterate my appeal to all financial service providers including Access Bank Zambia Limited, to make some meaningful efforts in addressing the high cost of banking services in the country. It is also my expectation that the banking sector will take advantage of opportunities arising from the conducive macroeconomic environment in the country to create wealth and contribute to the development in our economy. Finally, let me extend my gratitude to the Board of Directors and the Managing Director of Access Bank Zambia Limited for inviting me to officiate at this launch of the two branches and the Visa Debit Card. I also wish to particularly thank the Access Bank, Group Deputy Managing Director, Mr Herbert Wigwe for having travelled all the way from Nigeria, to come and be part of this event today. It now gives me great pleasure and honour to declare the Acacia and Longarces branches officially launched.
The review should also look into the decision-making policies and processes for the hiring of foreign professionals. For example, junior or non-specialist openings should generally not be open to foreigners unless the firm has established that locals cannot fill or be trained to fill such roles. Second, FIs should actively identify and groom Singaporeans with high potential for leadership roles. 21. We have heard often that international experience and exposure is one of the key attributes of a successful global leader. To support this, MAS introduced the International Postings (iPOST) scheme back in 2013 to send their promising Singaporeans for overseas postings. We enhanced it earlier this year, to provide 90% and 70% co-funding of qualifying costs for postings to Southeast Asia and other Asia locations respectively, so as to increase our pool of local talent with Asian acumen. With the international exposure under their belts, many of these Singaporeans have also returned to take on bigger roles in their careers. Third, all FIs should strengthen their HR capability, for example, by certifying their HR professionals with the Institute of Human Resource Professionals (iHRP). 22. Conclusion 23. Human capital is the single most important ingredient of Singapore’s success as an international financial centre in Asia. MAS remains committed to work with our tripartite partners on the Financial Sector Tripartite Committee, to protect, renew and expand our local workforce 5/6  BIS central bankers' speeches  capabilities, so that we can emerge stronger from the crisis for the benefit of Singapore. 24.

Strengthening the Singapore Core In supporting the continued growth of Singapore as a leading global financial centre in Asia, we place a high priority on ensuring that financial sector growth is achieved in a way that is supportive of local employment outcomes. 15. Singapore serves as a key financial hub for the region and is well placed to benefit from Asia’s growth and economic transformation as it emerges from COVID-19. One of the key prongs of our developmental strategy is to attract more global and regional headquarter functions of the FIs here to serve the broader Asian region. When that happens, it will involve FIs bringing in a diversity of talent from their global workforce to build up these new functions here, and this may cause the proportion of Singaporeans in these FIs to come under pressure. However, anchoring more global and regional functions here also brings along more growth, good jobs and opportunities for Singaporeans. Further, it opens up possibilities for Singaporeans to tap on the international footprint of these global financial institutions to gain overseas exposure, with some taking leadership positions overseas. We have to remain open and will continue to welcome global talent that complement our workforce. Employers must, however, hire in a responsible manner and 16. 4/6  BIS central bankers' speeches  commit to growing the local talent pool.
Throughout the postwar history of the UK economy, policy-makers have had to strike a balance between the impact of the external value of the currency on the competitiveness of exports and its potential effect on inflation through import costs and the pricing climate. In my view, we have allowed the pound to depreciate more than is necessary or desirable to support the growth of manufacturing and exports. For example, allowing sterling to rise by about 10% from its current level against the euro £ = € would still leave it at a relatively competitive level by historical standards £ = € The very significant fall in sterling from mid-2007 to early 2009 probably helped to support manufacturing industry and exports and hence stabilise the economy in the depths of the recession. But now the world economy is recovering, exports and manufacturing activity are being strongly boosted by the growth of world trade. Meanwhile, worries about deflation have been replaced by the concern that the UK economy now faces a sustained period of relatively high inflation which is endangering our track record of price stability. In these circumstances, our approach to the value of sterling needs to strike a different balance from the view we took in the depths of recession.

But the longer this process of accommodation goes on, the greater the risk that it becomes ingrained in expectations of relatively high future inflation and then credibility needs to be re-established with more abrupt interest rate changes and tighter policies in the future. It may be that indicators of an upward drift in inflation expectations are only flashing amber at present. But if the MPC waits until they are flashing red, and if other pressures continue to push up UK inflation in the meantime, the Committee could face a very difficult situation later this year or next. A well-conducted monetary policy should aim to move policy in anticipation of events and in a smooth and orderly way if possible. And as I prepare to leave the Committee at the end of next month, I do worry that the MPC’s credibility and commitment to the inflation target may already have been eroded by not adjusting policy settings soon enough – as the challenge for monetary policy has shifted from preventing deflation to curbing inflation and from halting recession to managing the recovery. Concluding remarks I started studying economics in the mid-1970s and my career as a working economist began in the mid-1980s. Throughout this time as a student and practitioner of economic analysis, we have seen UK monetary frameworks come and go, generally in the midst of an economic crisis. Since the Bretton Woods system of exchange rates collapsed about 40 years ago, the UK struggled to sustain a stable monetary policy framework for any substantial period.
Independence should allow us to incorporate into our decision-making elements that are relevant for the welfare of citizens in the long run. It is much more difficult for politicians to do this, basically because, of course, they incorporate the political cycle into their decision-making. But, if this is the case, then the legitimacy of central bank´s independence is essentially based on utilitarian grounds, in the sense that we think, with this independence, we are in a better position to deliver on our mandate. The key e is how can we invest in this legitimacy in a better way. Probably the best way to do so is to connect this need for delivering on our mandates to the controls, the transparency and the accountability that always needed to go hand in hand with independence. Relate to the efficacy in delivering on our mandates, one thing that probably we have not done enough, and I will give an example of what the Basel Committee is doing, is to evaluate what we do, and in particular evaluating our own capacity to deliver. Central banks do very often is to emphasise the need for the evaluation of other public authorities. But it is not always the case that we do this with our own mandate. Of course, we have to take into account that when evaluating it is difficult to construct the counterfactual. It is very complex, and of course, a social science such as economics is not always ready to give a definitive answer.

Such assessments are further complicated by the fact that there have been a number of important structural changes in the mortgage markets. Without going into detail, weighing the available evidence together, we do not think that residential property in Sweden is significantly overpriced in general. Nor do we believe that households in general are overly indebted. However, this does not preclude the possibility that there are other countries where house prices and household indebtedness have risen to levels beyond what can be fundamentally motivated. Yet, even if we don’t believe that house prices and household indebtedness have been disconnected from their fundamental drivers, there are still reasons for us to be concerned by the rise in property prices and household indebtedness. In the last years, in Sweden as elsewhere, household debt has grown much faster than disposable income. Obviously, this is not sustainable in the long run, as households then ultimately would be unable to service their debts. In the long run it is likely that indebtedness and house prices will increase roughly at the same rate as the nominal growth of the economy. This type of adjustment, to more restrained growth rates, will normally occur smoothly, as households begin to feel that their finances cannot tolerate a higher level of indebtedness. However, if there is an overly sharp correction or “hard landing” if you like, it could lead to weak growth in the economy for a long period of time. In this case, it would also have effects on inflation.
Ravi Menon: Securing price stability as Singapore restructures Speech by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the Asian Bureau of Financial and Economics Research (ABFER) Opening Gala Dinner, Singapore, 21 May 2013. *  *  *  Professor Bernard Yeung, Dean, NUS Business School, whose tireless efforts have brought to fruition the Asian Bureau of Financial and Economics Research, distinguished guests, ladies and gentlemen, good evening. Interesting times again Monetary policy has become interesting again. The Great Moderation, beginning in the mid-1980s and spanning two decades, marked the triumph of monetary policy over the scourge of inflation. The formula worked brilliantly – independent central banks, with clear mandates to pursue price stability, and doing so with consistency and credibility, ushered in an era of macroeconomic and financial stability supporting steady economic growth and rising prosperity. Then came 2008/2009 – unleashing a financial crisis of unmatched scale and impact, and a global recession deeper than any seen since the Great Depression. We are still living in the shadows of these two shocks, with the global economy stuck in a hesitant and uneven recovery and financial market stresses resurfacing from time to time. Monetary policy in the advanced economies has entered unchartered waters, in a valiant effort to support economic growth, which was being weighed down by deleveraging. In the emerging economies, central banks and governments have had to be equally nimble in their policy responses, as they grapple with the spillover effects of these unconventional monetary policies.

The first thing I should say is that the effort has to be shared, not only by monetary authorities and governments, but also notably by the institutions themselves. The monetary authorities have, in recent months, mediated to a greater extent in the provision of liquidity to the financial system, also granting it at longer maturities and in other currencies, such as the US dollar and Swiss Franc. The Eurosystem has firmly committed itself to strengthening this line of action, and has in fact undertaken to grant the liquidity that institutions may require, without limit as to the amount and at a fixed interest rate, provided that they have the appropriate collateral, the acceptable range of which has been significantly widened. Also, in an unprecedented action, the central banks of the main  BIS Review 133/2008  7  economic areas of the world took the joint decision to cut interest rates by 50 bp on 8 October. Admittedly, this reduction was not immediately passed through to market rates, owing to the crisis on the financial markets. But it is a measure that should be conducive to recovery in the confidence of consumers and businesses in the medium term. For their part, governments have taken various decisions for coordinated action at the international level. The upshot is a set of measures characterised by their exceptional nature and forcefulness, since their objective has been to break the market standstill. The proposal agreed by the European governments covers various areas.
The economic rent should benefit society as far as possible. 3  Statoil (2016): Results for fourth quarter 2015 and capital market update 2016. 4  Norwegian Petroleum Directorate (2015): Evaluation of reserve growth for oil – 2005–2014. 5  Norwegian Petroleum Directorate and Ministry of Petroleum and Energy: www.norskpetroleum.no. 8  BIS central bankers’ speeches  Employment has been high in Norway for many years. Compared with other countries, unemployment has been low. In the competition for labour resources, oil production and oil service companies drew the longest straw. The situation has now changed. Unemployment is on the rise. Norway’s oil regions, which have long reaped the benefits of the upswing, are now struggling. The downswing is proving painful for many. But the situation is far different from the adverse conditions that prevailed in the 1980s, which resulted in a deep economic crisis in Norway. But unemployment must be expected to be higher than we have been accustomed to in recent years. Closing a business takes less time than developing a new one. Restructuring takes time. Restructuring must start in the business sector. Economic policy can only help set the stage. Monetary policy can facilitate the restructuring process by supporting a weaker krone exchange rate and thereby expedite adaptation to a lower cost level. In addition, reduced interest expenses will contribute to income growth for many households. There is still room for manoeuvre in monetary policy. When unemployment rises, as is the case today, it may be appropriate to use the fiscal space available.

Never before in recent history have global interest rates been as low for as long as they are today. The interest rate level was moving down long before the 2008 financial crisis. What lies behind this is an enduring decline in long-term real interest rates. The decline is attributable to structural changes that have weakened the growth capacity of many economies, low productivity growth and weaker growth in the labour force. BIS central bankers’ speeches  13  In the wake of the financial crisis, interest rates fell from an already low level to even lower levels. Central banks slashed policy rates to counter the downturn. The room for further rate cuts was gradually exhausted. In this situation, central banks have shown a capacity for new thinking. They have purchased securities on a large scale. The purchases have continued to push down long-term rates. In addition, a barrier has been broken. In a number of countries, the policy rate is now negative. Negative policy rates can affect the economy via lower bank lending rates and a weaker exchange rate. These are well-known channels. But the effect of further policy rate cuts may weaken when rates fall below zero. An important reason is that banks are reluctant to set negative deposit rates, especially for households. For many retail customers, substituting cash for bank deposits is fairly inexpensive. If banks hold back on deposit rates, lending rates can only fall to a limited extent before banks’ earnings are reduced.