samchain/econo-pairs-v1 huggingface dataset:
As you would expect, this makes it difficult to assess in advance, or even in real time, the amount of loosening or tightening that is likely to be necessary to achieve the goals of central banks. Even if we had precise knowledge of key economic relationships, our ability to assess economic conditions in real time would be impeded by data limitations. Though most modern central banks implicitly or explicitly target some measure of inflation, the host of issues surrounding the proper definition and measurement of inflation for policy purposes is daunting. In general, most economic data are subject to sampling error and so cannot simply be taken at face value. Also, many of the series we rely on are subject to revision as more or better information becomes available, and potentially can even be redefined in a way that makes the history of the series less useful for interpreting current movements. Finally, data are often reported with a significant enough delay to limit their use as a read on current conditions. But, even if we knew the model and data with certainty, it is impossible to perfectly predict the evolution of factors that are largely beyond the influence of current monetary policy but that would likely affect our policy today if we knew for sure how they would look tomorrow. One way to say this is that we simply cannot know what types of "shocks" are likely to hit the economy or when they will hit.

Another important example of delegation to experts has been the creation of independent central banks to decide on monetary policy to deliver an inflation target set by government. Frustration with high inflation in the 1970s made many countries move towards de-politicizing decisions about monetary policy and interest rates. Research suggested that political pressure led to an ‘inflation bias’ in policymaking, which could be 8  solved by delegating responsibility for price stability to independent central banks. The following decades  1  Source: Ourworldindata.org Source: World Health Organisation 3 Source: The World Bank 4 Where poverty is defined as living on less than $ a day at 2011 prices. Source: World Bank (http://data.worldbank.org/topic/poverty) 5 Source: World Bank 6 Source The Food and Agriculture Organisation (FAO) of the United Nations 7 Until 46 BC, the calendar used in the Roman Empire consisted of 12 months of a total of 355 days, with the intention that an additional month would be added in some years so as to keep the calendar in line with the solar year (of 365¼ days). The pontifices had some discretion over the calendar, meaning they could use it for political advantage by lengthening or shortening the terms of Roman magistrates who were supposed to serve for a calendar year. This led to considerable confusion for ordinary citizens as to what date it was. Moreover, by the 40s BC the Roman calendar was three months ahead of the solar calendar.
1 The Market Advisory Group (MAG) in the framework of the ESY € project 2 4/5  BIS central bankers' speeches  2 European Payments Initiative  5/5  BIS central bankers' speeches

Lastly, it must be borne in mind that the short and medium-term challenges posed by the recent period of extraordinary crises do not make tackling the banking sector’s structural challenges – such as those linked to the management of climate-related risks, digitalisation and growing competition from technology firms – any less urgent. Thank you. 10
Money markets: The market for securities of less than one year includes government and central bank bills, repurchase agreements of government paper (repos), commercial bank certificates of deposit, corporate commercial paper and trade finance instruments such as bankers’ acceptances. These markets, in their inter-bank or over-the-counter (OTC) form, have been in existence for a long time in many countries. A newer phenomenon, however, has been for these instruments to be listed on organized stock exchanges and for central banks to increasingly conduct monetary policy through open market operations in these instruments. Ladies and Gentlemen, in developing economies debt markets which include public entities (ministries of finance, central banks and specialized government agencies for housing, agriculture, export and industry), are the most creditworthy borrowers and generally dominate the issue of local currency debt. However, we are seeing an increasing ability to issue corporate obligations beyond one year in local bond markets. The maturity structure (yield curve), however, generally does not extend beyond two or three years, and the central problem for both government and corporate borrowers is to push out maturities as far as is possible. Equity Markets which are organized stock exchanges in emerging economies have been slow to develop because of the traditional reluctance of closely-held firms to divulge information to the public or an unwillingness to dilute voting power and control of the firm. For these reasons, closely-held private placements have historically been more important. Another important group of investors in capital markets are Institutional Money Managers.

This did not happen in Thailand, despite timely and vigorous warnings. On the contrary, policymakers attacked the symptom of the crisis, the pressure on the baht, accumulating large reserve losses and forward foreign exchange liabilities in the process. This, together with delays in addressing Thailand’s severe financial sector problems and lingering political uncertainties, clearly contributed to a deepening of the crisis and its spread to other economies in the region. The second lesson is that other countries can find that their vulnerability to crises in other markets is greater than economic fundamentals would suggest. Consequently, they need to take pre-emptive actions to strengthen their policies. Where might such action be needed? Several suggestions come to mind: •  one, maintaining an appropriate exchange rate and exchange rate regime. Clearly, there is no single “right” choice, but more flexible exchange rates can help provide early and visible signals of the need for policy adjustments and are less likely to invite reckless behavior on the part of borrowers and lenders.
A key question for the future is this: do notification and memo-posting suffice, so that funds actually move at discrete times in the day, as they do in the UK, or do funds need to move in near real time as well? 2  BIS central bankers’ speeches  In the near term, we in the Federal Reserve continue to work to reduce the time required to complete payments and deliver payments-related information in the channels in which the Fed operates. The debate to be had by the industry is whether our existing payments mechanisms can meet the needs of the future or we need to embark upon designing a next generation payment instrument. We welcome your voice in that debate. Let’s turn our focus to end-to-end efficiency in the payments system. Innovation is occurring in closer proximity to end-users, at points between payment providers and their customers, and between merchants and consumers. Enhancing efficiency will mean moving business-tobusiness (B2B) and person-to-person (P2P) payments from paper to electronics, and bringing down the end-to-end cost of initiating and receiving payments. Efforts will continue by Internet/Web vendors to create customer-facing technologies to help users initiate payments. Here’s where mobile and handheld innovations may play a large role. In what form, and when, growth occurs will depend on when alternatives offer the speed, convenience, simplicity and other advantages that drive broad adoption.

The Federal Reserve Banks’ strategic plan focuses on fostering safety and  BIS central bankers’ speeches  3  security not only in Federal Reserve interbank networks and applications, but also the safety and security of the payments process from end-to-end. The challenges and opportunities related to speed, efficiency and security of payments are most apparent when we examine the mobile and international payment ecosystems. The mobile revolution is blurring the lines between commerce, both online and offline, and payments. In this new world, payments are but a small part of the value to be delivered in the commerce experience, with loyalty programs, location and behavior-based offers, and personal financial management tools becoming part of the broader customer experience. Financial institutions are working hard to figure out how they will participate. We must consider how the payments industry can design its future systems and services to address these new opportunities. The business challenges for financial institutions are also great when considering international payments. Cross-border transactions are generally slow, inconvenient and inefficient, especially bank account-centric international payments sent or received on behalf of consumers or businesses. Some closed networks, such as Western Union and PayPal, have made advances in this space, but their networks are not as ubiquitous as open banking networks. Our leadership in the global economy calls for a more seamless international payment experience. Each of these areas – speed, efficiency, security – are embodied in the Federal Reserve’s vision for the future of payments.
Room for improvement: explaining our policy choices The public emphasis that we, as inflation targeters, place on achieving outcomes for inflation plays a key role in underpinning the MPC’s anti-inflation credentials. But this focus can be a double-edged sword, in that it can give the false impression that inflation is the sole focus of our monetary policy. In fact, over recent years nothing could have been further from the truth. Indeed, inflation has been above target for the vast majority of the period since the financial crisis. Yes: some of this inflation overshoot might be the result of poor forecasting. For much of this period, the Committee expected inflation to fall back to target more quickly than it actually did. But much more important was the recognition that a lower profile for inflation was possible only by tightening monetary policy at the expense of an even deeper recession and an even greater rise in unemployment. Throughout this exceptionally challenging period, monetary policy has  1  See Bank of England Quarterly Bulletin 2013 Q2 and recent Inflation Reports for a detailed analysis of recent movements in inflation expectations. 2  BIS central bankers’ speeches  consistently been set to ensure that inflation remains on track to return to the 2% target in the medium term.

As such, the Committee can remain largely agnostic about the extent to which productivity is likely to pick up and instead respond to the signal provided by movements in the unemployment rate.6 At the same time, the three knockouts make clear that the Committee will continue to pursue such a policy only if it does not pose a risk to price or financial stability. Its levels that matter The second challenge relates to the need for the Committee to explain how monetary policy is likely to evolve as the economy recovers. The good news is that after several years of virtual flat-lining, a recovery appears to be taking hold. The UK economy grew by over 1% in the first half of this year, more than in the previous two years put together. And it looks set to grow even more quickly in the second half of this year. The most recent indicators and business surveys suggest that the economy may currently be growing at an annualised rate of between 3% and 4%. In the midst of this long awaited growth, there is the risk that people may overreact and expect the MPC to start raising Bank Rate relatively quickly. Such an overreaction would risk dampening the recovery, pushing up longer-term interest rates and, more generally, causing companies and families to pullback from investment and spending decisions for fear of an imminent rise in borrowing costs. And based on past experience, there would be good reason for people to behave in such a way.
In this regard, the regional swap arrangements already signed by a number of countries are a step in the right direction. By strengthening the credibility of central banks, such arrangements have the scope to impart positive impacts in terms of reduced volatility in regional  BIS Review 99/2001  3  financial markets. In light of the large pool of savings and international reserves the region currently has, there may be room for further initiatives on this front. In addition, there seems to be scope to better mobilize regional savings and improve intra-regional capital flows. In the past, the savings rates of countries in the Asia-Pacific regions have been very high. But most of these savings were channeled first to the United States and Europe before eventually returning to Asia. I believe that we should look into ways to better channel these regional savings so that they help to cushion our countries from excess volatility of capital flows. I am glad that yesterday Mr. Kuroda proposed the establishment of a co-operation on capital flows and the streamlining of foreign exchange policy among the ASEAN plus three group. Thailand welcomes this move which would not only help reduce excess volatility of capital flows for countries in the region, but also provide exchange rate stability to support intra regional trade, which constitutes about 50% of our exports. We are willing to move forward with ASEAN plus three in this direction.

Mr McDonough comments on the implications for the strong US growth for the world economy  Speech by Mr William J McDonough, President of the Federal Reserve Bank of New York, before the Japan Center for Economic Research, Tokyo, on 30 March 2000. *  *  *  Good afternoon, ladies and gentlemen. It is a great pleasure to be invited to speak before such a distinguished audience. My thanks to the Japan Center for Economic Research for extending such a kind invitation. This afternoon I would like to share with you some of my thoughts on the US and the world economies as we move forward into the 21st century. To do so, it is helpful to step back and take a somewhat longer-term view of how the stage was set for much of the current strong economic performance the US economy has enjoyed in recent years. In addition, I would like to comment on the implications of the strong US growth for the world economy. The United States is now experiencing the longest economic expansion in its history. This expansion, which began in April 1991, not only has reached record length, but also has done so in a far stronger manner than had been expected. Most notably, inflation has been subdued, notwithstanding the most favorable labor markets that the United States has experienced in a generation, and the country’s fiscal accounts are in surplus. There is no question that this expansion reflects some remarkable changes in the US economy.
Over the past five years, significant efforts have been undertaken to modernise Malaysia’s retail payment infrastructure and migrate away from inefficient paper based payment instruments such as cash and cheques. Good progress has since been made, especially in the displacement of cheques. The annual decline rate had accelerated from an average of –1.6% in 2011 to 2013 to –10.1% in 2014 and –16.5% in 2015. Concurrently, there is also an increase in the uptake of electronic fund transfer services. The annual growth rate for the Interbank GIRO (IBG) had increased from an average of 18.8% prior to 2013 to 34.1% in 2014 and 2015. The Instant Interbank Funds Transfer (IBFT) service had also recorded encouraging growth where its annual growth rate of over 60% since 2011 had further increased from 67.8% in 2014 to 76.7% in 2015, signifying greater confidence in the use of e-payments. However, we must not be complacent. As we move forward, there are two technology trends that hold immense promise to revolutionize the payments market. The first is the proliferation of mobile technology and ubiquitous communications. Increasingly, mobile devices are the preferred channel for consumers to make payments conveniently from anywhere and at any time. The second is the ability to process payments and move funds instantaneously around the clock. Towards this end, Bank Negara Malaysia’s wholly-owned subsidiary MyClear has initiated a multi-year program to modernise Malaysia’s payment infrastructure.

In maintaining the soundness of the financial system in Singapore, MAS’ approach is centred on establishing sensible rules appropriate to our circumstances, strengthening prudential and market conduct supervision, and working in partnership with the industry to develop a shared ownership of supervisory outcomes. 9. This approach has served us well. As global reforms reshape the financial landscape, we will continue to strengthen our supervisory and regulatory regimes and market infrastructure, consistent with new international standards and best practices. As we have done in the past, we will calibrate these changes to take into account our environment and regulatory objectives. 10. MAS is supportive of global reform efforts to strengthen capital and liquidity frameworks. We have always considered capital adequacy and effectiveness of a bank’s risk management and capital planning processes as important parts of overall prudential management of banks. As a member of the Basel Committee on Banking Supervision, we participated actively in international discussions that helped shape the broad agreement reached earlier this week on the main design elements of the new capital and liquidity reform package. Other design details such as calibration, and phase-in arrangements as well as the framework for regulatory buffers will be determined later in the year. We would like to see a set of final proposals that can be implemented globally in a meaningful manner to promote the long term stability of the banking system.
In any event, the effect of a moderate interest rate rise is not expected to be very significant, in part because of the increase in the share of fixed-rate mortgages observed in recent years, which accounted for 24.9% of the outstanding balance in December 2021. Specifically, it is estimated that the proportion of households with a high net interest burden would rise by 1.2 pp, 2.3 pp and 3.9 pp if interbank rates were raised by 100 bp, 200 bp and 300 bp, respectively. Such effects would be felt more strongly among indebted households between the 20th and 40th income distribution percentiles. High debt levels also make public finances more sensitive to market interest rate movements. However, the recent low interest rates have prompted a continuous decline in the interest burden as a percentage of GDP. At the same time, longer average debt maturities limit the short-term impact of increases in issuance costs. Under a scenario consistent with the latest projections, in which market rates are raised progressively, the debt burden as a percentage of GDP would stabilise. Based on this scenario, an additional  22  The effect of a rise in energy costs is also simulated. 24  100 bp increase in both short and long-term interest rates, all other things being equal, would push up interest payments by 0.4 pp of GDP in 2024.

Only a resolute economic policy response to the multiple short, medium and long-term challenges facing the Spanish economy will enable us to follow a robust and sustained growth path that offers opportunities for all in the coming years. This response must also be long-lasting and thus requires a broad political and social consensus. The new uncertainties generated by the war in Ukraine and the persistent uncertainties stemming from the pandemic – two absolutely extraordinary events – demand no less. 25
Room for improvement: explaining our policy choices The public emphasis that we, as inflation targeters, place on achieving outcomes for inflation plays a key role in underpinning the MPC’s anti-inflation credentials. But this focus can be a double-edged sword, in that it can give the false impression that inflation is the sole focus of our monetary policy. In fact, over recent years nothing could have been further from the truth. Indeed, inflation has been above target for the vast majority of the period since the financial crisis. Yes: some of this inflation overshoot might be the result of poor forecasting. For much of this period, the Committee expected inflation to fall back to target more quickly than it actually did. But much more important was the recognition that a lower profile for inflation was possible only by tightening monetary policy at the expense of an even deeper recession and an even greater rise in unemployment. Throughout this exceptionally challenging period, monetary policy has  1  See Bank of England Quarterly Bulletin 2013 Q2 and recent Inflation Reports for a detailed analysis of recent movements in inflation expectations. 2  BIS central bankers’ speeches  consistently been set to ensure that inflation remains on track to return to the 2% target in the medium term.

BIS central bankers’ speeches  7  Figure 3 Real exchange rate (*) (index, 1986=100) 120 110 100 90 80 70 88  90  92  94  96  98  1991-2010 average  00  02  04  06  08  1996-2010 average  10 RER  (*) Preliminary for August 2011. Source: Central Bank of Chile. Figure 4  Change in Central Bank of Chile's international reserves (percentage of GDP) 8  8  6  6  4  4  2  2  0  0  -2  -2  -4  -4 91  93  95  97  99  01  03  05  07  09  11 (*)  (*) The reserves include the purchase of $ billion announced in January 2011. To forecast GDP, growth and inflation projections in the September Report are used. Source: Central Bank of Chile. 8  BIS central bankers’ speeches  Figure 5 Central Bank of Chile balance sheet (billions of pesos, percent) 3.000  30  2.000  20  1.000  10  0  0  -1.000  -10  -2.000  -20  -3.000  -30 97 98 99 00 01 02 03 04 05 06 07 08 09 10 Net result  NER variation (*)  (*) Corresponds to y-o-y exchange rate variation at December of each year. Source: Central Bank of Chile.