samchain/econo-pairs-v1 huggingface dataset:
To this end, we need to speed up international work under the aegis of the FSB. Highest priority should be given to the finalisation of the FSB recommendations on stablecoins and other crypto-assets, in cooperation with other international standard-setting bodies (CPMI, BCBS, FATF). The second priority should be to regulate the interconnection between the traditional financial system and the crypto-asset market in a secure way. The timely and faithful implementation of the Basel standards on the prudential treatment of banks' crypto-asset exposures, published in December 2022, will be key from that perspective. The development of crypto-asset based services in banks must take place within a prudent framework that limits the risks for financial stability. Consequently, the enforcement of prudential standards should strictly take into account the developments of interconnections between crypto-assets and regulated entities, such as banks. Lastly, two new issues will require a global regulatory response. DeFi is the first one: its use of public blockchains and its global reach make it difficult to allocate  3/4  BIS - Central bankers' speeches  responsibilities and impose strong regulatory requirements such as in MiCA. But the FSB is working on it: it has already published a report on DeFi's vulnerabilities and policy work is in progress. Second, we need to address challenges raised by worldwide crypto conglomerates. The FSB has also initiated work on this type of crypto-asset service providers to identify and monitor the risks associated with the concentration of their activities.

The problems with inflation were then accentuated when the financial markets were deregulated. Prices and wages rose steeply and Sweden was caught in wage-price spirals. The occurrence of price bubbles made investment decisions more hazardous and led to weak productivity. A high level of inflation became a permanent feature of our economy. As monetary policy at that time was focused on maintaining a fixed exchange rate, fiscal policy ought to have been tighter. Bit by bit, there was a growing awareness across party political lines that in the longer run this economic policy strategy was not viable, a perception that had already dawned on most countries in our part of the world in the early 1980s. It was now that low inflation in Sweden came to be seen as a necessary condition for achieving stable and sustained growth and thereby high employment. This was clearly expressed officially for the first time in the Budget Statement in January 1991. Combating inflation was given pride of place on the economic policy agenda. The final policy objectives were the same as before but the perception of the conditions that were needed to attain them had changed. This realignment of stabilisation policy occurred, however, at a time when the earlier policy’s negative consequences had begun to leave their mark. Due to the high level of costs in manufacturing, for example, economic growth in Sweden was weak. In addition, a rising real interest rate coincided with a period when the tax reform made savers and investors more sensitive to interest rates.
These include the low precipitation that affected hydroelectric power, various diseases that affected livestock and the fact that Sweden and southern Europe suffered poor harvests. We are in agreement with other forecasters and analysts that the inflation rate will fall as the effects of the transitory price rises abate and inflation approaches 2 per cent in early summer. In the longer term perspective, however, the picture looks slightly different and developments indicate an inflation rate above the target of 2 per cent. The assessment contained in the main scenario of the most recent Inflation Report has CPI inflation at 2.2 per cent one year ahead and 2.4 per cent two years ahead. The corresponding forecast for underlying inflation, UND1X, is an increase of 2.2 per cent at both one and two years ahead. It is the latter measure that is the most central to monetary policy. However, each inflation assessment also takes into account the risk spectrum. The risk spectrum mainly concerns domestic inflationary pressure. If resource utilisation comes under greater strain than the Riksbank has estimated in its main scenario, or if the potential growth rate has been overestimated, there is a risk that inflation will be higher than expected in future. Taking into account the risk spectrum, underlying inflation comes out at 2.3 per cent both one year and two years ahead. Although the inflation rate is expected to fall over the coming months, the forecasts indicate that it will exceed the inflation target one to two years ahead.

Elvira Nabiullina: Speech - OPORA RUS Governor SIA session Speech by Ms Elvira Nabiullina, Governor of the Bank of Russia, at the OPORA RUS Governor SIA session, 3 December 2020. * * * Good afternoon, I am happy to welcome you, whether you are now in the Kaliningrad Region or are video conferencing — this format is becoming quite common now. I hope that this meeting is attended by a large number of participants. Indeed, I was listening very attentively and I think that the approach the Kaliningrad Region is pursuing to develop small and medium-sized businesses is promising and comprehensive. However, we are all very well aware that a lot of projects depend on how accessible funding is — it would be impossible to implement a project when there is no access to funding. Today’s meeting is very important to me: although the Bank of Russia influences the economy through the financial sector, the ultimate goal of our work is to ensure that the financial sector helps the economy and people overcome hardships and develop. Of course, we have always been concerned about the issues related to the financing of small enterprises. We carry out regular meetings with OPORA RUSSIA President Alexander Kalinin several times a year to discuss the most topical problems and advance in both the regulation and other areas associated with the development of multiple projects.
11  In this  10  See Rachel, L and Smith, T (2015), ‘Secular drivers of the global real interest rate’, Bank of England Working Paper No. 571 and ‘Resolving the climate paradox’, speech by Mark Carney at the Arthur Burns Memorial Lecture, Berlin, 22 September 2016, available at http://www.bankofengland.co.uk/publications/Documents/speeches/2016/speech923.pdf. 11 Among companies responding to the Bank’s Decision Maker Panel survey between February and April 2017, Brexit was the largest current source of uncertainty for 10%, one of the top two or three sources of uncertainty for 30%, one of many drivers of uncertainty four 40% and not important for the remaining 20%. 4  All speeches are available online at www.bankofengland.co.uk/speeches  4  context, the best contribution the Bank of England can make is maintaining financial and monetary stability by pursuing the right policies within consistent frameworks. In recent years, the Bank has been determined to remove any lingering uncertainties that companies may have about access to finance in good times and bad. The Bank is building the resilience of the financial system through much higher capital levels, more prudent underwriting standards, rigorous stress testing and appropriate contingency planning. The core tier 1 capital ratios for major UK banks are now almost 14% (Chart 12). Yesterday, the FPC increased the countercyclical capital buffer rate to 0.5% from 0%, announced higher expectations of lenders’ underwriting standards for consumer credit, and recalibrated the leverage ratio.

As the primary objective of monetary policy remains inflation control, any overshoot of inflation above the target can only be temporary in nature and limited in scope. As such, the MPC has been clear that its tolerance for above-target inflation is limited. Since the prospect of Brexit emerged, financial markets, notably sterling, have marked down the UK’s economic prospects. Monetary policy cannot prevent the weaker real income growth likely to accompany the transition to new trading arrangements with the EU. But it can influence how this hit to incomes is distributed between job losses and price rises. And it can support households and businesses as they adjust to such profound change. 12  See the statistical annex to the Bank for International Settlements 87th Annual Report, ibid. 5  All speeches are available online at www.bankofengland.co.uk/speeches  5  As spare capacity erodes, the trade-off that the MPC must balance lessens, and, all else equal, its tolerance for above-target inflation falls (Chart 15). Different members of the MPC will understandably have different views about the outlook and therefore the potential timing of any Bank Rate increase. But all expect that any changes would be limited in scope and gradual in pace. When the MPC last met earlier this month, my view was that given the mixed signals on consumer spending and business investment, it was too early to judge with confidence how large and persistent the slowdown in growth would prove.
This can best be achieved when the largest possible number of the community’s members are involved. 4  Individuals are at the same time citizens and economic subjects, thereby creating a crucial interdependency. Proper integration into a balanced economic environment is an important prerequisite for developing a sense of common purpose - in other words, identifying with society and thus also displaying a willingness to actively help shape its progress. This ultimately means that economic and social development can only progress in a sustainable and balanced way if an appropriate equilibrium can be maintained between them. 5. Even at a time when global economic and social developments are becoming more and more closely intertwined, being an integral part of a national community still plays an important role. It is still essential that these national communities should strive first and foremost to keep their own house in order - a house, though, which should not just be stable but open as well. 6. Ensuring the stability of the financial system is one of the core tasks of the supervisory authorities and of the central bank in its capacity as lender of last resort. However, the market players’ sense of individual responsibility is also of key importance. If a third party is to offer assistance in a system run on free market principles, this can and should be seen as nothing more nor less - than helping the others to help themselves. BIS Review 26/1998

The euro has the potential to also be a complete strategic success in the future  1. The euro has the potential to become a major reserve currency as an alternative to the US dollar  The euro is already the second most widely-used international currency in the global monetary and financial system. But, 18 months after the introduction of the single currency, it is fair to say that while the euro has become the first financing/issuing currency in the world, it has not so far made the same progress as a reserve/investment currency. The low level of interest rates in continental Europe has fostered the international financing role of the euro (euro-denominated bonds accounted for some 45% of new issues in 1999 which, as I mentioned earlier, somewhat exceeds the market share of new USD-denominated bonds). Conversely, these relatively low remuneration rates have reduced the role of the euro as a reserve currency (in central bank portfolios) or, more generally, as an investment currency (in private investors’ portfolios). Since the launch of the single currency, the low level of interest rates in the euro area and the continuous depreciation of the euro have temporarily slowed down the emergence of the euro as a major reserve currency. This leads me to say a few words on the depreciation of the euro in the past 18 months. 2.
At first glance it would appear that card payments – which are 35 per cent cheaper for society to produce – should replace cash completely. But it is not quite so simple. There are major differences in how cards and cash are produced. Card payments require an extensive infrastructure of terminals, computers and lines of communication and have substantial fixed costs. But the cost of a card payment is always the same, regardless of whether one uses the card to pay for a purchase amounting to SEK 50 or SEK 50,000. For payments made in cash the variable costs are substantial. Cash payments require considerable physical management such as transport, counting, storage of banknotes, etc. The larger the transaction amount, the more expensive the actual cash payment will be, as it involves a larger share of this management. For payments of small amounts the cost of cash is therefore lower than the cost of a card payment. This means that from society’s point of view, cash may be preferable for making small payments. To obtain an idea of what the size of a transaction may mean, we estimated the costs to society of a cash payment and a card payment respectively as functions of the transaction amount. In this way we could also calculate when it was profitable to pay in cash. The results show that – at lease in 2002 – it was most cost-efficient to pay in cash for purchases amounting up to almost SEK 70. 7 Above this, card payments were always preferable.

As regards the economic effects, the recent crisis concerning Ukraine and the consequent imposition of sanctions on and by Russia has so far had limited spillover effects on the euro area economy, either via trade or financial links. However, the Baltic states and Finland are more likely to feel any negative effects than other euro area economies owing to the strong trade ties they have with their eastern neighbours. But on the economic risks, I would like to add that the European “family” provides safety nets to partly offset the negative effects of geopolitical tensions related to Russia and Ukraine. For instance, the European Commission announced support measures to protect food producers affected by Russia’s food embargo. The euro area is a large market that can help Lithuanian producers to make up for losses from the Russian market. Finally, euro area countries can use the emergency liquidity lines provided in euro by their national central banks, which in turn would receive euro liquidity from the Eurosystem, in the event of significant turbulences in the financial sector. Why is lending to the real economy in the euro area sluggish? What else needs to be done in addition to the mix of different measures that the ECB is applying, such as low interest rates (or negative interest rates for bank deposits at the ECB) and the planned asset-backed securities programme? It is true that credit dynamics remain weak. At the same time, recent trends show some positive changes.
First, I will review trend developments in financial intermediation and single out a recurring theme in the evolution of the financial markets over the last 30 years: the rise of securitisation and collateralised finance. I will then consider the consequences of this innovation for the transmission of monetary policy in the post-crisis world. I will start by looking at the money markets and turn to the wider financial system, including the shadow banking sector. Looking forward, the main sources of collateralisation will be an issue to consider if the present trend towards downscaling the creation of private asset-backed securities continues. Public debt instruments are likely to play an important role. This will lead us to reflect on the role of central banking at a time of high public debt. 1. The rise of collateral  The financial system has undergone profound changes over the past few decades. Markets have grown significantly; competition has intensified. These are well-known phenomena. I would like to focus on the consequence of this, namely that the core of financial intermediation has moved from depository institutions – commercial banks – to a hybrid aggregate of institutions and functions, which is broadly referred to as the shadow banking system. The rise of the shadow banks, their ups and their downs, are inseparably connected with a key financial innovation of the last 30 years: securitisation. The emergence of a shadow banking system is not a new phenomenon.

However, we also made clear that given the speed of growth and the growing connections with conventional finance, it could pose such a risk relatively quickly and we needed to get on with the work of bringing it within the regulatory perimeter. Recent events have not, in my view, changed that assessment. I should stress that when I refer to crypto here, I am talking about crypto technology in finance writ large, such as encrypted tokenisation and distributed ledgers (like blockchain), rather than just the dominant initial use case, which has been the creation of speculative assets such as Bitcoin. I do not know what the future holds for such assets, other than that they will continue to be volatile and that those that invest in them need to understand that the prices can collapse. Page 5  However, while the initial use case for crypto may or may not have a limited future, the technologies that have been developing in the crypto ecosystem and their possible use cases are, I think, likely to be developed further in both the crypto world and in the much larger traditional financial system. Indeed, I suspect that the boundaries between these worlds will increasingly become blurred. In this we should perhaps be mindful of the ‘Dot Com’ bust at the beginning of this century. The valuation and revenue generation from the original use cases of early online firms was highly speculative and collapsed.
And while the actual tasks performed by the Bank’s branches have changed since the network began expanding in the 1830s, the end goal remains unchanged: to support and serve local economies in order to back local initiatives and provide assistance in coping with economic and financial risks. From the time of its creation until the First World War, operating in an economy with relatively few banks and in which few people had bank accounts, the branch network of the Banque de France aimed at facilitating payments and supporting the regions during economic shocks by offering discount refinancing solutions. France’s economy has changed enormously since the 19th century. GDP per capita has grown by a factor of more than 20 since 1800 and by more than seven since 1914.9 Our banking and financial system has also been greatly modernised and now offers payment and credit solutions that are much faster and less costly than in the past. Reflecting these dual economic and financial transformations, the way in which the Bank performs its task of serving the regional economies has evolved. Our service to support local economies have expanded and now extend to households, especially the most vulnerable people, and companies, particularly the smallest  8  Leclercq, Yves, 1999, La formation d'une banque centrale: la Banque de France (années 1830 - années 1850), Revue économique Vol. 50, pp. 151-174 9 Source: Our world in data, Maddison Project Database 2020, see Jutta Bolt and Jan Luitten van Zanden, Maddison style estimates of the evolution of the world economy.

By bringing together senior officials from central banks and supervisory agencies from over 100 countries, this year’s meeting will provide the platform for us to move ahead on the core of the regulatory changes, and to chart the direction for the remaining areas of work. 5. The two themes for this year’s conference – building a more resilient banking system, and creating a stable financial environment for sustained economic growth underscore two key principles. First, the financial system needs to be resilient to avoid destabilizing the economy. Second, beyond resilience, rebuilding the nexus between the financial sector and the real sector is critical to supporting growth and development. This is particularly important in many emerging economies where the pace of financial sector development has not caught up with that of the real economy. 6. Let me now share some reflections on three themes that permeate discussion on financial resilience – microprudential regulations, macroprudential regulations, and supervisory approach. The Basel Committee’s reforms 7. Many banks entered the crisis with too much leverage, too little capital and inadequate liquidity buffers. We need better micro-prudential regulations. Banks need to reduce leverage, have higher quality and quantity of capital to absorb losses, and maintain a higher proportion of liquid assets to withstand shocks in the funding markets. 8. The Basel Committee has agreed on the need for standards relating to capital, liquidity and leverage.
A second potential explanation for how the supply side data have evolved is that since the referendum workers have responded to uncertainties about the outlook by showing even more flexibility in their wage demands. People’s willingness to accept lower real wages would encourage firms to hoard labour, and shift away from capital expenditure toward more labour input for a given unit of output. Such a further increase in labour market flexibility would imply that part of the recent renewed weakness in productivity growth is cyclical, meaning there is a bit more room for the economy to grow without generating above-target inflation in the medium term. I attach some weight to the idea that workers have responded to the changing outlook by showing greater flexibility in their wage demands. This would be consistent with a trend I have observed throughout my career and in successive cycles in which peaks and troughs in unemployment have been lower in each cycle since the 1980s. Since the crisis, real wage flexibility has been particularly notable, and it may have intensified further since the referendum as the unemployment rate has fallen further to 4.3%. As supporting evidence I would point to the fact that the weakness in private sector real wage growth relative to the MPC’s May 2016 forecast has been greater than would be required just to match the weakness in productivity 3  growth , and that is in spite of the additional pressure on real income growth from higher import prices over 4  the same period .

Ask not what the economy can do for insurers – ask what insurers can do for the economy Speech given by Anna Sweeney, Executive Director, Insurance Supervision Division Delivered at the Bank of America 25th European Financials CEO Conference 22 September 2020  I am grateful to Alan Sheppard, Megan Bell and Zachary Morris-Dyer for their assistance preparing this speech. 1  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  Good morning and thank you to Bank of America for inviting me to speak here today. In a normal year, I would use these remarks to run through our regulatory agenda. But this year it is inevitable that my remarks will focus on the effects of Covid-19: a human tragedy for millions, the worst economic crisis in the UK for several centuries and an unparalleled global challenge. Our economy and the actors within it are continuing to face numerous challenges and a great deal of uncertainty. The aim of the Bank of England – along with colleagues from other public sector institutions – has been to build a bridge across the economic disruption caused by the pandemic. And insurers – as providers of protection, as guarantors of retirement income and as institutional investors - have an important role to play in the recovery from that crisis.