samchain/econo-pairs-v1 huggingface dataset:
Perhaps the biggest danger for the candidate countries is that they will come under too much pressure. One such risk is the exchange rate regime. From the point of view of foreign investors, the years immediately before and after membership run the risk of being characterised by unwarranted euphoria. The inflow of capital to equity and real estate markets in these countries can be so large that asset prices and real exchange rates become overvalued. When the capital flows then wane slightly and some capital leaves the countries again, this may come as a surprise. In connection with EU membership, with fixed nominal exchange rates, even within a fairly broad band, pressure on the exchange rate can arise. The best thing then is to have clear regimes with a clear target. Several of the large countries now have inflation targets with a floating exchange rate, which is not as exposed to speculation attacks. Other smaller and very open candidate countries have currency boards in euros and have shown that they can adapt flexibly to both shocks such as the Russian crisis and rapid fluctuations in investment flows. The choice of an exchange rate regime can affect flows of foreign capital. But it does not in itself change the pressures for real appreciation and depreciation created by large capital inflows or outflows. However the actual effect will vary depending on the regime.

The USA's increase in growth in the 1990s was partly due to the US economy being internationalised more rapidly than before, with a larger percentage of GDP exposed to international competition than the EU. If eastern Europe is now integrated more closely with western Europe, this could create a more efficient division of labour and raise productivity in western Europe. The challenge of EU enlargement eastwards could rouse decision-makers in western Europe to a more intensive reform effort so they can fully take advantage of what will, in total, be the world's single largest market. There are parallels here to Japan's success story in the 1970s and 1980s, when Japanese industry, which had not yet subsided into its own structural problems, benefited from the interplay with the dynamic Asian economies that complemented the Japanese companies. Just as the dynamic Asian economies additionally formed a bridge to China, the candidate countries comprise a bridge to Russia (particularly the St Petersburg  2  BIS Review 9/2002  region where Sweden is concerned), the Ukraine and the other CIS countries – areas that should also become a growing part of the EU's trading sphere. Moreover, unlike many dynamic Asian economies, the candidate countries' populations have always had a very high level of education; in science and technology it is fully comparable with the level in the current EU member countries.
To complete the picture, net wealth has also risen across the majority of regions since 2008, on average by 13% (Chart 13a). In only three regions (the North East, East Midlands and West Midlands) has net wealth fallen. These patterns are broadly as we would expect if monetary policy has loosened credit conditions, boosted asset prices and wealth and thereby supported domestic demand, at least in the short-run. That said, this is a rather imperfect experiment. Factors others than monetary policy are also likely to have contributed to movements in GDP, unemployment and wealth (in particular housing wealth) over that period. To pinpoint the specific contribution made by monetary policy, we need a model of the economy. By using the Bank of England’s suite of macro-economic models, we can quantify the specific role played by monetary policy in explaining movements in incomes and jobs, albeit rather imperfectly given that all models are imperfect. Charts 11b, 12b and 13b plot the change in real GDP per head, unemployment and wealth respectively since 2008, under the hypothetical assumption that monetary policy had not been loosened over the period but had remained at levels prevailing in 2008. 17  This paints a stark picture of what might have been in the  UK. 16  This is set against a trend decline in global real interest rates and what economists refer to as the ‘neutral’ level of interest rates.

Mr. Trichet discusses Franco-German monetary cooperation and monetary union Speech by the Governor of the Bank of France, M. Jean-Claude Trichet, on the occasion of the fiftieth anniversary of the Land central bank of Rheinland-Palatinate and the Saarland in Mainz on 2/6/97. It is a great honour to speak in Mainz today and to celebrate the fiftieth anniversary of the Land central bank of Rheinland-Palatinate and the Saarland. Everybody knows that Mainz played a decisive role in spreading culture and ideas in Europe, in particular thanks to the invention of printing by Gutenberg. And the celebration of the fiftieth anniversary of your institution gives me the opportunity to underline once again the prominent role played by the Bundesbank for the stability, credibility and prosperity of the German economy. As you know, the Banque de France deeply supports this culture of stability, which sets the basis for monetary cooperation between France and Germany, the basis for European monetary union. The celebration of an anniversary is a good opportunity to draw lessons from the past and to foresee the future. That is why I have decided today to speak about Franco-German monetary cooperation during the last fifty years and the prospects for monetary union. In this respect, the creation of the single currency on January 1st, 1999 is a major event for our respective countries. Far from being a breaking off with the past, the creation of monetary union is the logical crowning of Franco-German monetary cooperation.
Of course, the principles and continued testing are part of prudent planning, and do not imply that normalization will necessarily begin soon. As always, the views I express are mine alone and do not necessarily reflect those of the Federal Reserve Bank of New York or the Federal Reserve System. The committee’s normalization principles and plans Let me start by briefly reviewing the statement on normalization principles and plans that the FOMC published following its September meeting. Importantly, this statement is intended to provide the public with information about the eventual normalization process and does not signal a change in the current or future stance of policy. As the Committee indicated in its September post-meeting policy statement, it continues to anticipate that it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends, especially if projected inflation continues to run below the Committee’s 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored. Many elements of the normalization principles and plans are similar to the principles adopted by the Committee in June 2011, while others have been revised in light of the changes since then in the size and composition of the System Open Market Account (SOMA), the Fed’s securities portfolio, as well as enhancements in the tools the Committee will have available to implement policy during normalization.

In particular, as of September 22, the maximum bid limit per counterparty was raised from $ billion to $ billion, an overall size limit of $ billion per operation was imposed, and an auction process was introduced to determine the interest  13  Indeed, even prior to 2008, the range of fed funds trading on a given day could be quite wide, and the effective rate deviated significantly at times from the target rate for a day or two. This did not have any apparent effect on financial conditions or the economy. 6  BIS central bankers’ speeches  rate on the operation and allocate take-up when the sum of bids exceeds the new $ billion limit. 14 The $ billion individual bid limit was informed by evidence on the desired investments of counterparties that had bid at the previous maximum of $ billion, and it took into account the size of assets under management of our counterparties. For almost all counterparties, the $ billion limit is unlikely to be binding in any circumstances. The $ billion overall limit was above total demand observed over the first year of testing, with the exception of the operation conducted at the end of the second quarter of this year. So what are the benefits of moving from a structure with individual caps alone to one with an aggregate cap as well?
Real household income outgrew GDP by a cumulative 7 % points during that decade. 1 In part this reflects productivity improvements in the distribution sector. In the mains it’s because  productivity tends to rise faster in goods production than in services. The technology for making cars and computer chips improves more rapidly than those for cutting hair, designing software or providing insurance. The result is that relative employment, production costs and prices all tend to decline in manufacturing. This helps to explain why the UK has had weaker productivity growth than some economies with a larger industrial sector. But the higher share of services in UK exports has also tended to mean relative prices move in its favour. In general – the last couple of years providing one very clear and egregious exception – what is lost on one front is made up for on another. Bank of England  Page 5  Clearly – and with a vengeance – the early part of this decade has seen a sharp reversal of these trends. In the third quarter of this year, UK GDP will probably be only slightly below where it was in the last quarter of 2019, immediately before the pandemic. Yet real household income is likely to be over 3% lower, with real corporate profits down by more than 5% (around 10% if you exclude the North Sea).

Yet there was almost no perceptible response of nominal pay and domestic prices. Economists attributed this decline either to the change in monetary regime itself, or – more often – to greater flexibility in the labour market. Chart 7: Lower sensitivity of wages to real income shocks during inflation targeting period  Rolling coefficient on wedge between consumer and output prices using 18-year regressions. Dotted line shows coefficient estimated by Layard, Nickell and Jackman (LNJ) on 1956-85 sample. Source: Layard, Nickell and Jackman (1991), ONS and Bank calculations. But it was hard to be confident about these estimates. Labour-market flexibility isn’t set in stone. In a speech in 20066, Charlie Bean suggested that increased ease of migration, in both directions, might have reduced the sensitivity of real wages to shifts in labour demand. It’s possible that, by adding a degree of friction to  5 Layard, Nickell & Jackman (1991), ‘Unemployment: Macroeconomic Performance and the Labour Market’. 6 Bean (2006), ‘Globalisation and Inflation’. Bank of England  Page 14  the inflow and outflow of migrant workers, the combination of Brexit and the pandemic have made the labour market less adaptable than it was a few years ago. There may be other reasons why susceptibility to second-round effects can vary. During the one period in which higher import prices seriously impinged on real incomes, following the financial crisis, unemployment was also much higher than it is today.
14  World Bank (2013), Doing Business 2014: Understanding Regulations for Small and Medium-Size Enterprises. 15  Foster, N., Poschl, J., Rincon-Aznar, A., Stehrer, R., Vecchi, M. and Venturini, F. (2013), “Reducing productivity and efficiency gaps: The role of knowledge assets, absorptive capacity and institutions”, in European Competitiveness Report, DG Enterprise and Industry, European Commission. 16  See for example Gomez-Salvador, R., A. Musso, M. Stocker and J. Turunen (2006), “Labour productivity developments in the euro area”, ECB Occasional Paper No. 53, October 2006. 17  Bourlés, R., Cette G., Lopez J., Mairesse, J. and Nicoletti, G. (2012), “Do product market regulations in upstream sectors curb productivity growth? Panel data evidence for OECD countries”, Review of Economics and Statistics, MIT Press, vol. 95(5). 6  BIS central bankers’ speeches  to have access to adequate initial and vocational training – something which on the whole US firms seem to have been able to do better than European ones.18 As part of this process, reallocation of resources is both unavoidable – as firms need to restructure – and essential – to concentrate resources where they are most productive. There are however important differences in the extent to which capital and labour flow to innovative firms. For example, researchers at the OECD have found that a 10% increase in the patent stock is associated with an increase in the typical firm’s capital stock of about 3% in Sweden and the United States; 1.5% in the United Kingdom and Germany; and a 0.5% in Italy and Spain.

Just let me give you an example: security is not something that people can actually address only at national level. Unfortunately, we have seen this very frequently through various terrorist actions. Everything in economics now is basically global. So it’s even beyond being only European. It’s actually all over the place. The more we integrate, the better we’ll be placed to address economic issues of this nature. Think about defence. Does it make sense today saying that countries are able to defend themselves against global challenges? Well, less and less. Think about another challenge: migration. Migration is not a problem of one country. It’s a problem, a challenge and an opportunity for a group of countries. In this case, the European and eurozone countries are certainly called to respond to this challenge. All this means that having a European perspective has become essential to understand today’s problems and the possible solutions. The key 1/2  BIS central bankers' speeches  question that you will be asked more and more in the future is “What can we achieve together?” We count on you to embark on this long journey: we invite you to be our ambassadors, to continue the conversation on Europe in your schools and cities, with your relatives and friends. You will have an important role to play in tomorrow’s Europe, but that role, that responsibility, starts today. You give us not only hope for a better future, but you also inspire us to continue our work.
As inflationary pressure can vary according to demand and changes in the level of resource utilisation, the events caused the Riksbank and other central banks to decide to lower their instrumental rates shortly after the attacks. Now that almost exactly nine months have passed, we can conclude that the impact on the global economy was less than feared, although some sectors, such as the airline industry, were hard hit. Furthermore, we are seeing increasing signs that economic activity is improving both in the USA and Europe. One factor that often contributes to turnarounds in economic activity is companies’ stockbuilding. When stocks are well-filled and sales decline, companies cut back on production so that it becomes even lower than demand. This destocking then pushes economic activity down to begin with. When the cutback in stocks gradually reaches an end, companies can increase production again without waiting for demand to increase. This gives increased strength to the upturn in activity. It is probable that this is the case right now; according to several indicators production has begun to increase and a certain amount of optimism is beginning to spread. The total economic policy is expansionary in many countries, which provides additional fuel to the sequence of events. The economic situation in the USA and Europe This means that demand on Sweden’s most important export markets is increasing. The turnaround has been particularly noticeable in the USA. There, both residential construction and household demand have been upheld during the economic slowdown by stimulation policy.

It appears that growth in investment will increase in the period ahead: the high level of investment in the petroleum sector will contribute to higher investment growth in the offshore supplier industry. There are signs of rising investment in the construction industry. "Repatriation" is also being considered in Rogaland: the Gjestal Spinneri spinning company is looking at the possibility of investing in a new facility in Oltedal, enabling the company to transfer production from the UK to Norway. Employment is rising, with the most marked increase in the construction sector. Almost a third of the enterprises report that shortages in the supply of qualified labour may constrain output growth. Through the past year, there have been increasing reports of higher selling prices. One in four manufacturing enterprises is expecting a higher rise in prices this year than in 2004. In retail trade, two in three enterprises are expecting an accelerating rise in prices. The picture is mixed for the corporate service sector. Profitability is still improving considerably in all sectors. This reflects both an increase in volume and cost reductions. In the adopted budget for 2005, the structural, non-oil deficit increases compared with 2004. It therefore appears that fiscal policy will provide some stimulus to growth this year. In the National Budget for 2005, the underlying rise in expenditure over the central government budget was projected at 5.2 per cent, which is somewhat lower than the previous year and somewhat lower than projected nominal growth in mainland GDP.
In particular, due to the still exceptionally low interest rates, there is, however, a considerable risk that these imbalances continue to build up, and the risk of an abrupt correction over the medium term keeps increasing. Under these circumstances, the SNB is carefully monitoring the developments in mortgage and real estate markets. It periodically assesses the necessity to activate the countercyclical capital buffer. Issuance of the new banknote series in 2015 at the earliest In February 2012, the National Bank informed the public that the new banknote series would be postponed. Today, I would like to provide some background information on our decision. The National Bank is committed to putting banknotes into circulation that are state of the art in terms of both their design and their technological aspects. In order to meet this standard, such a project must be launched at an early stage. Integrating and combining security features involving new technologies that have not previously been used for banknotes presents a special challenge. Since the development phase for new security features is very long, launching a new series is likely to take several years for the technical feasibility assessment alone. Certain insights can only be gained during the actual serial production. 2  BIS central bankers’ speeches  The development of the new banknote series began in 2005 with a design competition.

Jean-Pierre Danthine: Financial stability developments and the delayed new Swiss banknotes Introductory remarks by Mr Jean-Pierre Danthine, Vice Chairman of the Governing Board of the Swiss National Bank, at the Media News Conference of the Swiss National Bank, Berne, 13 December 2012. *  *  *  In my introductory remarks today, I would like to look at the main developments in the area of financial stability since the publication of our Financial Stability Report in June of this year. Afterwards, I will talk about the postponement of the new banknote series. In the area of financial stability, the improvement in the big banks’ capital situation is particularly noteworthy. The prevailing uncertainties and the risks for the banking sector as a whole remain considerable, however. Prevailing risks remain considerable General economic and financial conditions for the Swiss banking sector remain difficult. On the one hand, the situation in the financial markets has eased since June 2012. This is largely due to various decisions and measures taken by governments and central banks worldwide. On the other hand, the easing of tensions in the financial markets should be interpreted with caution. Should the measures already taken not be effective or should the progress made in restructuring government budgets be slow, we cannot rule out renewed turbulence in the financial markets. The European banking industry is also in a fragile state.
The result could have been a vicious cycle involving low economic activity, increased funding stress for banks and a further reduction in lending, eventually leading to significant downside risks to price stability. The actions of the ECB have helped to break this cycle and to bring confidence back into the euro area financial system. The large amount of liquidity now present in the system is a consequence of these actions. It represents the symptoms of a malfunctioning interbank market, which, if left untreated, could have led to a credit squeeze. The ECB’s ability to maintain price stability remains intact: we will have the possibility to adjust the interest rates and, if necessary, we have at our disposal a range of tools to actively absorb the excess liquidity. 8  BIS central bankers’ speeches  The ECB has addressed the immediate symptoms, but monetary policy cannot cure the underlying causes. The situation in financial markets has reached a turning point but recent market developments have highlighted that it remains fragile. All the relevant players must act responsibly by taking the necessary steps. Banks need to meet capital adequacy objectives, improve their funding profile, and start lending again. Governments must build on the steps already taken to restore sound fiscal positions and support long term growth. At the ECB we will continue to closely monitor further developments. We will do whatever it takes to fulfil our mandate of delivering price stability over the medium term for the 330 million people of the euro area.

They have significantly higher gross job creation (and destruction) rates than large enterprises. At the same time, SMEs tend to face more stringent financial constraints, have a higher cost of external finance and exhibit higher debt levels than large firms. According to the most recent survey on SMEs conducted by the Eurosystem, in the second 2  BIS central bankers’ speeches  and third quarter of 2011 access to finance remained one of their most pressing problems. To put things into perspective, bear in mind that the number of firms concerned about financing was actually lower in 2009, a period when economic activity in the euro area was very weak. According to the survey, bank financing (via overdrafts, credit lines and bank loans) remained the most important source of external financing for SMEs. In addition, 20% of the respondents perceived a further decline in banks’ willingness to provide loans. Therefore, after the improvement registered in 2010, SMEs were experiencing once again significant constraints in obtaining financing. In the light of this evidence, the concrete risk that the increasing pressures on banks’ funding and capital positions could lead to a significant curtailment of banks’ lending activity in some countries was judged to be extremely high in December 2011. In particular, a dangerous loop involving low economic activity, funding stress for banks and a reduction in lending had increased the downside risks to price stability. It was therefore a top priority to break this loop before it spiralled out of control.