samchain/econo-pairs-v1 huggingface dataset:
However, the European Union holds a trump card as it boasts the world’s largest pool of savings, with the annual surplus of domestic savings over investment regularly exceeding EUR 300 billion. For this reason, we see a critical need to foster equity financing, as it is ideally suited to innovative projects, which entail higher risk-taking. This is also why, on a broader note, we support implementation of the Capital Markets Union [SLIDE 5], which, through a series of technical reforms, will enable Europe’s plentiful savings reserves to be allocated efficiently to companies through market financing. Efforts to strengthen the Capital Markets Union must be conducted in concert with steps to deepen the Banking Union, which remains an absolute priority. These two initiatives are crucial to the continued financial integration of the EU and will ultimately pave the way for investment and innovation to be funded more effectively. That is the diagnosis that I wanted to share: the twin transition to a digital future and a sustainable economy has the potential to weaken not only banks, but also financial stability and the real economy. Yet this is merely a diagnosis, not a prognosis. This same risk could also be a source of beneficial changes. 2. The banking sector: a participant in the digital and green transition  3/6  BIS central bankers' speeches  And so I come to what could and should be done to turn these challenges into opportunities. I will talk about three courses of action.

For example, they are making public commitments in different areas that can have a positive impact in terms of mitigating and adapting to climate change, such as their carbon footprint, fossil fuel exit strategies, shareholder engagement and greenhouse gas emissions reductions. The ACPR and France’s securities regulator, the AMF, which have been monitoring these commitments for the last two years, stress that significant headway has been accomplished in a short time, but also warn that progress still needs to be made if banks are to communicate more clearly and transparently about their objectives and especially about the means of action likely to ensure that these collective commitments are kept. Banks could also contribute to the transition to a sustainable economy by playing their part in the emerging green bonds market. This market doubled in size in 2021 to reach EUR 460 billion globally, of which half is denominated in euros [SLIDE 7]. But it still has lots of room to grow, judging by the fact that green bonds made up a mere 0.4% of the total volume of bonds issued during the same year worldwide and 2.6% in Europe. In this setting, the new label will help to support a fast-growing market while also preventing greenwashing risks. 2.3 Central banks are also helping to steer these transformations as they lead by example [SLIDE 8] To conclude, I would like to say a few words about what we at the central bank are doing. I will offer two illustrations for each challenge.
After falling by 3.1 percent in 2009, growth in real GDP averaged 2.4 percent in 2010, 1.8 percent in 2011 and 2.2 percent in 2012, a consistent but sluggish pace. This sluggishness has been quite evident in the labor market. After falling by 421,000 per month in 2009, payroll employment grew by 85,000 per month in 2010, 175,000 per month in 2011, and 181,000 in 2012. To put these numbers in perspective, the trend rate of growth of the civilian non-institutional population is around 200,000 per month. The unemployment rate has declined from a peak of 10 percent in October of 2009 to just under 8 percent recently, due largely to the fact that the labor force participation rate has declined by considerably more than would be suggested by underlying demographic trends. Fortunately, long-term unemployment, defined as those unemployed for 15 weeks or longer, has declined from nearly 9 million in the first quarter of 2010 to about 6.6 million in recent months – a decline of 28 percent. The median duration of unemployment has declined from 23 weeks in the second quarter of 2010 to 16 weeks recently. Nonetheless, as of January there were still about 3.2 million fewer jobs than at the end of 2007. The unemployment rate remains elevated, despite a significant decline of the labor force participation rate. And the ratio of employment to population in January was lower than it was at the end of the recession, indicating that employment growth has not kept pace with population growth.

In particular, we may expect that, after three years of robust growth, investments in residential construction will stagnate at a high level. Overall, we project GDP growth of just over 1.5% this year. Previously, we had expected growth to reach about 1%. To a large extent, this correction to our growth forecast is due to seco’s revision of the figures for the first two quarters. For 2006, we forecast economic growth of a little more than 2%. This would take GDP growth to a level above the potential growth path for the Swiss economy. The output gap – i.e. the gap between normal and actual utilisation of resources – will diminish. Monetary development Alongside the figures for the real economy, movements in monetary and credit aggregates also indicate that economic recovery is underway. Since adopting a resolutely expansionary monetary policy three years ago, mortgage lending has grown at an annual rate of over 5%. We continue to monitor developments in the real estate market closely. Since September, other loans have also recorded positive rates of growth with respect to year-back figures. In the past, a development of this kind usually indicated a strengthening in economic recovery. The economy is well supplied with liquidity as a result of the expansionary monetary policy. Although the growth of the broadly-defined monetary aggregate, M3, had fallen to 1% in October 2004, it has since climbed back to over 6%. However, excess liquidity will be gradually reduced as a result of the interest rate increase announced today.
Meanwhile, both the ECB and the European Commission introduced new pandemic instruments, which benefitted the domestic economy, though the benefits of some of these, like the Next Generation EU funds, will accrue during 2021. Given this context, the Bank expects economic activity to contract sharply this year, with a gradual recovery starting next year, though this outlook is conditional upon a containment of the spread of the virus and the rollout of a vaccine during 2021. Compared with our August projections, we are revising GDP growth downwards in 2020 and 2021 due to the deterioration of the international economic environment; the renewed containment measures introduced in October; and a more subdued recovery in tourism than previously anticipated. Exports are expected to be the largest contributor to the decline in GDP in 2020. Both domestic and external factors have been severely negative for exports during this year. In particular, foreign demand has declined dramatically while travel disruptions negatively affected services exports. In addition, supply disruptions during the first part of the year have adversely impacted the productive capacity of Maltese exporters. Exports should bounce back next year, but will likely remain constrained by uncertainties related to travel and Brexit. Furthermore, in 2021, foreign demand is expected to recover only partially from the decline experienced in 2020. As restrictions were lifted in May and June, private consumption is expected to have recovered somewhat, partly assisted by the Government’s voucher scheme, though uncertainties about the length of the pandemic are likely to have kept household saving higher than usual.

The literature on growth has been expanding lately, but most work on transition agrees that macroeconomic stability linked with structural reforms is essential to growth (Wyplosz, 1999; Fischer and Sahay, 2000). And it is equally true that most transition economies have responded positively to the combination of the two and after a sharp decline in GDP today have positive growth. We have learned as well that the growth process is much more complex than was anticipated at one time. We know that the future success of reforms depends very much on elements like: institution building, contract enforcement, rule of law, etc. To explain the complexity of growth in transition a little bit I will use two concepts: a) human capital and b) social capital. a)  Human capital  Let me immediately start by quoting Lucas (1993) on what causes growth: “The main engine of growth is the accumulation of human capital - of knowledge - and the main source of difference in living standards among nations is difference in human capital” (p.270). So, if we want sustained growth we must promote the accumulation of human capital in transition economies. The next question is: How does the accumulation of human capital happen? Obviously, there are many ways in which human capital is accumulated but, to mention just a few: it happens in schools, in other forms of training, particularly on-the-job, in research institutes, etc.
Øystein Olsen: Economic perspectives Address by Mr Øystein Olsen, Governor of Norges Bank (Central Bank of Norway), to foreign embassy representatives, Oslo, 8 April 2019. * * * Accompanying slides of the speech. Your excellencies, ladies and gentlemen. Firsts of all, I would like to thank you for taking the time to attend this event, which provides me with an opportunity to present Norges Bank’s view of the economic situation and some of the challenges ahead. International economic cooperation is creaking Throughout history, technological innovation and increased trade in goods and services have been important sources of growth and development. The two driving forces have functioned in tandem. Trade barriers have been reduced in recent decades. Faster transport and advanced communications systems have greatly facilitated access to broader markets. Global value chains have emerged, and service providers can be located far from customers. With freeflowing capital, we can invest globally. Chart: World trade has grown markedly Since the 1970s, world trade has grown rapidly. As a percentage of world GDP, international trade has almost doubled. A number of new countries have also increased their share in world trade. A more closely integrated world economy has facilitated specialisation, innovation and better use of local resources. The room for exchanging ideas and knowledge has expanded. Increased competition and innovation have gone hand in hand. Chart: Trade gives Norway opportunities Efficient global trade is particularly advantageous for small open economies, like Norway. Norway has benefitted greatly from the opportunities afforded by trade with other countries.

The new process will be open, transparent and inclusive. There will be greater input from the public and from external experts in the form of a new Advisory Committee with a majority of independent members. That body will recommend a broad theme – for example scientific achievement – before the public are invited to nominate characters within that theme. The Advisory Committee, with input from public focus groups, will narrow down the field to a final shortlist of characters and the Governor will make the final choice from that shortlist. These changes will ensure that the characters on our banknotes are fully representative of the history and diversity of this great nation, while having the necessary public respect and legitimacy. Our polymer notes will combine the best of progress and tradition. They will be more secure from counterfeiting and more resistant to damage while celebrating the history and tradition that is important both to the Bank and the nation as a whole. By consulting widely on the switch to polymer, and by putting in place a new process for selecting banknote characters with much more public input, we have reinforced the commitment to openness and transparency which lies at the heart of the Bank of England’s commitment to accountability. Together, these announcements ensure that our banknotes will remain both a national symbol and a source of national pride. 2  BIS central bankers’ speeches
But what fundamentally distinguishes today’s situation from, say, that of 2014–2015 is that regulatory easing was, in fact, just one additional comfort factor in a period of difficult conditions, and not “the last chance” or the only way to stay afloat. Undoubtedly, in the conditions of the epidemic, it helped greatly that Russian banks boast a high level of digitalisation. Almost all services were available online, and of those in demand on a daily almost all were available. Even before the epidemic, most banking customers extensively used remote services, but even those who previously rarely used remote services started using them without great difficulty. In my speech today, I would like to focus on two clusters of issues. The first deals directly with the impact the epidemic had on the banking business, the current situation, and the measures we are taking to ensure that going forward banks are resilient in their operations. The second concerns what comes next, how to develop the banking business with allowance for the long-term repercussions of the pandemic. How does the current situation look? In the last few months, we have seen a gradual recovery in business activity, the financial markets are stabilising, and lending is also recovering. It has to be said that the economy shrunk less than many expected. The recovery may be uneven, but it is proceeding broadly in line with our forecasts. In particular, this can be seen in our monitoring of sectoral financial flows, which we started conducting during the pandemic.

Maximum stability in output could, on the other hand, result in sharp fluctuations in the rate of inflation and erode the credibility of the monetary regime. A point somewhere midway between the two extremes must therefore be found. Consequently we cannot be called "inflation nutters" as Mervyn King, deputy governor of the Bank of England, once said. Let me also stress the importance of central bank independence. In order to be successful with the implementation of an inflation target approach, the central bank needs to be able to act independently of day-to-day party politics and to set interest rates continuously according to the specified inflation target. Otherwise a credibility problem may arise because it would be hard for policymakers to convince the general public of monetary policy's long-term nature. Following the changeover to a flexible exchange rate in 1992, monetary policy in Sweden was directed towards an explicit and quantified inflation target. The decision rule by which our monetary policy is usually guided is in fact quite simple. It states that if the forecast rate of inflation 1-2 years ahead is above 2 per cent, then normally the repo rate should be raised and vice versa. The reason why we chose this target horizon is that an adjustment of the monetary stance takes time to exert its full impact on inflation and the macro economy in general.
The reason is that it has proved difficult in practice to lower nominal wages. If inflation is low and nominal wages cannot be lowered, it becomes difficult to adjust real wages among different professions, companies and sectors. This can ultimately bring about both higher unemployment and poorer productivity growth in the economy. These problems can be mitigated if there is some inflation. Another advantage of a target of 2 per cent, which has been particularly apparent in recent years, is that a very low average rate of inflation would make it more difficult for monetary policy to counteract recessions. If inflation on average is very low in a world of low real interest rates, like today, the average nominal interest 8 [21]  rate will also be very low. The lower the interest rate is in normal conditions, the less scope there is to lower it before it reaches its lower bound. It will thus become more difficult to counteract future economic downturns with interest rate cuts. Thus, if you do not like negative interest rates, you should not advocate a lower inflation target, as that would involve the repo rate needing to be negative more often and for longer periods. There is a widespread international discussion on whether a target of 2 per cent, which most developed countries have now, really provides sufficient scope to conduct a monetary policy that is as expansionary as it sometimes needs to be.

Further, the value added tax on selected agricultural equipment and spares, was zero rated as incentive to increase agricultural production and productivity. (ii)  Tourism sector: – In order to diversify the economy and attain broad based economic growth, Government increased the allocation to the sector to improve access to the Northern Tourism Circuit (infrastructural development in Mbala and Kasaba Bay). Further, Government will embark on the development of a new world class tourism area in Livingstone, and step-up the development of road infrastructure in key national parks namely, Luangwa and Kafue. (iii)  Manufacturing: – In order to expand the manufacturing base, Government is promoting the establishment of Multi-Facility Economic Zones (MFEZ) on the Copperbelt (Chambishi), and Lusaka (Lusaka south and east) provinces by providing for fiscal incentives and quality infrastructure development in the budget. Operations at the Chambishi MFEZ have already commenced. Further, the budget reclassified and re-categorised certain manufacturing materials with the aim of lowering customs duty rates. (iv)  Mining sector: – In light of the adverse impact of the global economic crisis on the mining sector and with the view of easing these effects, the Zambian Government introduced tax concessions, which included removal of the windfall tax, increasing capital allowance to 100 percent as an investment incentive, and reduction of customs duty on Heavy Fuel Oils.
Finally borrowing countries are being increasingly encouraged to develop, in the current less febrile environment, an ongoing dialogue with their major external creditors in the expectation that this would help to identify emerging concerns and possible responses at an earlier stage and to promote a more constructive reaction on the part of those creditors when storms begin to gather. Now, all of these steps are steps which countries themselves can take to reduce the risks of domestic or external macro-economic shocks leading to financial instability, which in turn would be likely to amplify the effects of the initial shock. But with the best will in the world such shocks will no doubt continue to occur. And alongside all this work on what countries can do to help protect themselves, a major review of the terms and conditions of the IMF facilities is taking place, designed to increase the effectiveness of the financial help that the IMF can give to its member countries when they do run into difficulties. This is not an easy issue on which, I know, people hold strong views. We have to try to strike a sensible balance between excessively onerous and excessively liberal conditions attaching to IMF support. On the one hand, if IMF conditions - whether preconditions attaching to quasi-automatic support in the event of sudden capital outflows or adjustment conditions attaching to the Fund’s more traditional facilities - if in either case the conditions were too demanding, countries may be deterred from seeking the Fund’s help.

The Rt Hon Sir Edward George GBE: Towards a safer banking system  Speech by The Rt Hon Sir Edward George GBE, Governor of the Bank of England, to the Association of Professional Bankers Sri Lanka 12th Anniversary Convention, on 27 August 2000. *  *  *  Mr Governor, Ladies and Gentlemen, It is an immense pleasure, and a very great honour, to have been invited to address this Annual Convention. The theme of the convention is “Towards a safer banking system”. It is a theme which gladdens my heart. The safety of the banking system is fundamental to financial stability in a broader sense. It is vitally important, of course, to you - as professional commercial bankers. But it is vitally important, too, to us, central bankers, because you simply cannot have monetary or broader economic stability, which is a key part of our responsibilities, without stability of the financial system - they go together like love and marriage! And monetary and financial stability are vitally important, too, to our societies at large and to the individuals that make up our societies - they are absolutely necessary, if not in themselves sufficient, conditions for the economic prosperity to which we all aspire. The question is what can we do - working together - to improve the safety of our banking systems.
If the relationship between  4  In practice, so-called inflation-targeting central banks also tend to take into account employment and other aspects of the real economy; hence, their approach is often referred to as “flexible inflation targeting.”  5  More formally, a Taylor Rule can be represented as: FFR = r* + π + a(π-π*) + b[100(Y-Y*)/Y*] where: FFR = federal funds rate r* = neutral real federal funds rate π = rate of inflation π* = target inflation rate Y = output Y* = output at full employment a = weight put on inflation gap b = weight put on output gap  2  BIS central bankers’ speeches  monetary policy and the real economy were stable over time, following a relatively simple and unchanging policy rule would likely generate acceptable results. However, if the linkage between monetary policy and the real economy is more variable, as I believe it is, then an approach that is more pragmatic and updates the policy setting in a clear and systematic manner based upon what the FOMC learns over time will be more effective. In particular, a simple policy rule can generate poor macroeconomic outcomes when either the structure of the economy or the transmission mechanism of monetary policy changes in a significant way (whether the change is temporary or permanent).

To some degree, this likely reflects the anchoring exerted by stable inflation expectations. But some of the price pressures can be attributed to other, more temporary, factors:   Higher oil and gasoline prices and their pass-through into the costs of other goods and services.   Upward pressure on imputed homeowners rents due to increased demand for rental housing.   Higher import prices for goods, such as apparel. This reflects many factors including commodity prices pressures and higher wage inflation in countries such as China. Some of these upward pressures on inflation appear to be fading. Oil and gasoline prices have fallen in recent months. Apparel price inflation should gradually ease, given the sharp drop seen in cotton prices. Owners’ equivalent rent should also eventually stabilize as multi-family construction picks up and programs that shift real estate owned by banks to investors so they can be rented gear up. More generally, there are several reasons to think that inflation will remain moderate and close to our objective. First, and most obviously, the economy continues to operate with significant slack. Second, measures of underlying inflation show little upward pressure. In fact, one – the Federal Reserve Bank of New York’s Underlying Inflation Gauge – is turning down. This measure uses a very wide set of variables to forecast the underlying inflation trend (Figure 6). Third, it is hard to be very concerned about inflation risks when the growth rate of nominal labor compensation is so low and stable.