samchain/econo-pairs-v1 huggingface dataset:
This is an important function because modern electronic payment systems have the potential to serve as channels of contagion by transmitting the payment difficulties of one, or a few, large financial intermediaries to others in the system. In 2002 a Retail Gross Settlement System based on the Bank for International Settlements’ ten core principles2 was introduced in Malta through which inter-bank domestic payment orders are now transmitted, cleared and settled with greater efficiency than previously. The Bank has also issued a number of directives which seek to provide participating banks with an adequate degree of protection against legal and systemic risks associated with participation in such systems. Other directives seek to ensure that the rights of banks’ clients to adequate information concerning retail payments are upheld by the intermediaries rendering payment services. In this way, credibility in the integrity of the infrastructure used for the settlement of payments is preserved at both wholesale and retail level. The Bank’s role in financial stability has more recently been enhanced by membership of the European System of Central Banks (ESCB) from May 2004. It has started to participate in the ESCB  1  The 1967 Act referred to the Bank’s role in promoting a sound financial structure and to foster an orderly capital market in Malta.

The emergence of an advanced oil service industry is an industrial success story. We have extracted large quantities of oil and gas in a period of very high prices. And we have set aside a large proportion of the revenues – for the benefit of future generations. In spite of some mistakes and a fair share of luck along the way, we would have to say that Norway’s petroleum wealth has so far been managed well. Norway’s oil age is far from over. But activity in the petroleum sector has passed the peak. We must also be prepared for lower returns in the oil industry. In the period ahead, we should keep an important insight in mind: the key to economic progress is the ability to restructure. Thank you for your attention. 4  BIS central bankers’ speeches
The environment in which monetary policy was now to be conducted was thus different than during ‘The Great Moderation’. We therefore needed to review the arsenal of measures that can be used in a crisis situation. Many measures during one week in March last year We are now back where we started in my story, that is to say in March last year. What we saw then was a very rapid and dramatic sequence of events. The stock markets began to decline as early as late February, when the coronavirus began to spread increasingly quickly outside of China. The WHO declared COVID-19 to be a pandemic on 11 March. On 12 March we saw the largest stock market fall in one day in Sweden so far, when the index fell by 11 per cent. This meant that the index had fallen by 30 per cent since 20 February. The fixed-income markets were also affected to an extremely large degree (see Figure 7). All bond rates rose to a varying extent. Investors’ new motto was ‘dash for cash’, as they abandoned unsafe assets in favour of safer ones with high liquidity. Corporate bonds market under scrutiny When Swedish companies have needed to finance themselves with loans, they have traditionally used bank loans. But in recent decades, there has been a structural transformation, which means that they increasingly finance themselves via interest-bearing securities (see Figure 8). At present, interest-bearing securities account for one third of their loan financing.

As you all know, unregistered employment is about 50% in our country. This rate is higher in agriculture, construction and the services sector, where inflation is relatively higher. Unregistered economic activities prevent firms from attaining the most efficient scale of production and producing at the lowest unit cost. Firms failing to attain the lowest cost scale price their products at a relatively higher level. One of the factors influential in this is the financial burden brought about by registration procedures. In order to remain unregistered, firms are not willing to grow in scale. They also abstain from applying for bank credits and delay technological renovations due to financial hardship. On the other hand, the competitive power of registered firms is eroded against their competitors, which take advantage of remaining unregistered. Besides, growing in scale becomes harder for these registered firms. Major reforms were made in Turkey in 2003 to improve the business environment. The most remarkable of these are the regulations to reduce the procedures in starting businesses and to ensure that all the required transactions are carried out under the body of a sole authority. As a matter of fact, the results of the “Doing Business” report by the World Bank reveals that our country ranks fairly high compared to other countries in terms of the duration for starting businesses, reservation of ownership, enforcing contracts and paying taxes. The concrete consequences of these reforms are apparent in the number of newly launched businesses in the period following the year 2003.
Nonetheless, the available information indicates that the profile of smoothly moderating activity apparent since the second quarter continued in the third quarter, and this pattern can be expected to persist throughout the rest of the year, with scant deviations from the forecasts published by the Bank on 30 March (3.7% for 2007). This slight slowdown is based on domestic demand and, more specifically, on the consumption and residential investment components, while the contribution of net external demand to growth in the first half of 2007 improved further. The slowdown in GDP seems to point to a gradual shift to a growth rate of around 3% in 2008 as a result of some rebalancing of the domestic and external sectors. However, the shocks affecting the international financial markets since August have also increased uncertainty over the forecasts for the Spanish economy and have possibly heightened the downside risks. Allow me to spell out some of the factors behind this scenario of a smooth slowdown, compatible with continued highly dynamic activity and employment. BIS Review 130/2007  3  First, the change in monetary and financial conditions will foreseeably ease the adjustment to a more sustainable pace of private-sector spending and indebtedness. This adjustment started some time back and is proceeding smoothly.

This has led to its proliferation through multiple layers of leveraging and disproportionate distribution, in turn, which could result in higher systemic risks, thus, increasing the potential for instability in the financial system. In addition, transparency represents a basic tenet underlying all Islamic financial transactions. There is an inherent obligation on Islamic financial services providers to meet the appropriate standards of transparency. It is from the profit-sharing feature of Islamic financial transactions that imposes a high level of disclosure in the financial contract. The accountabilities of the respective parties involved in the transaction are clearly defined in the contract. This transparency also provides a strong incentive for Islamic financial institutions to appropriately manage risks. This disclosure allows the market to assign the appropriate risk premiums to the respective companies and thus the potential for the enhanced role of market discipline to take effect. These inherent features as required by the Shariah injunctions provides inbuilt checks and balances which serves to ensure financial stability in the Islamic financial system. These features are also reinforced by the development of a comprehensive regulatory and supervisory regime which has been strengthened considerably with the establishment of the Islamic Financial Services Board in 2002. It's establishment has also contributed to the harmonisation in the development of Islamic finance across different jurisdictions. Finally, education institutions have been established to develop the supply of professional talent and expertise in Islamic finance to support the growth and development of Islamic finance going forward.
The talks between the interested parties themselves and with the Fund did not however prosper. Accordingly, the Banco de España took action to avoid a crisis of confidence in CCM and market convulsion. On this point I should like to draw your attention to the reasons for adopting this decision with such urgency. Article 31 of the Law on the Discipline and Intervention of Credit Institutions authorises the Banco de España to take control of a credit institution or to resolve to replace provisionally its governing and management bodies when there is a situation endangering its own funds or its stability, solvency or liquidity. Since the directors of CCM had been unable to find a solution to prevent the problems worsening, it did not seem reasonable to delay the use of the precautionary measures provided for in the Law on the Discipline and Intervention of Credit Institutions in order to seek other solutions. Further, once the prospect of a merger had fallen through, there was an evident risk that, once the financial markets opened on Monday, 30 March, CCM would be subject to a crisis of confidence on the bond markets and further withdrawals of deposits from its branch network that could prompt a liquidity collapse. The delicate situation of CCM required the immediate activation by the Banco de España of the precautionary measure provided for in the rules governing the replacement of the Board and the appointment of new managers.

Given CCM's problems, the Banco de España’s supervisors had considered the institution worthy of "special monitoring". That justifies the constant vigilance of developments in CCM's risks, solvency, profitability and liquidity, since it was considered to be particularly vulnerable to a downturn in the business cycle and, in particular, in the real estate market. In the past year, CCM was subject to two inspections, with the second review based on year-end figures for 2008 currently drawing to a close. Allow me to focus on the recommendations made by the central bank in its supervisory capacity in recent years. Back in 2003, the recommendations detailed further to inspection called on CCM's directors, as was the case at other institutions, to reflect on the amounts assigned to funding real estate development activity, owing to the high risk this entailed. These concerns were taken into account in the ongoing monitoring of the institution and were reiterated in the letter of requirements following the first inspection carried out in 2008. These requirements referred to a sizeable volume of exposures in which some degree of impairment or weakness was apparent, denoting a deterioration in the quality of lending, which was accounted for by the global financial crisis and its impact on developments in the real estate sector and by other specific factors. The letter of requirements urged the Board of Directors to analyse risk policies and decisions, and to urgently apply the measures needed for a more effective management of bad debts, demanding as at that date an increase in write-downs.
For borrowers it has meant lower interest costs, but the other side of the coin is that they will not be able to amortise their debt solely through the effect of inflation. Their loans will take longer to pay off, which could entail the liability side of their balance sheet remaining unchanged while perhaps lower housing prices reduce the value of their assets. Many households also appear to be postponing amortisation of their loans, which seems like a short-term decision. Perhaps some households need to think about taking a longer-term approach in their loan decisions. Estimates of borrowing costs must also hold up when interest rates rise or when the value of the purchased house no longer does. Thank you. Prices of single-family dwellings and lending to households 350  350 Property prices, Index 1986:1 = 100 300  300  Total lending to households, Index 1986:1 = 100  250  250  200  200  150  150  100  100  50  50  0 1986  0 1988  1990  1992  1994  1996  1998  2000  2002  2004  Sources: Statistics Sweden and the Riksbank  4  BIS Review 67/2004  Number of new apartment starts 70 000 60 000 50 000 40 000  Forecast  30 000 20 000 10 000 0 1986  1989  1992  1995  1998  2001  2004  Single-family dwellings  Multi-family dwellings  Source: Statistics Sweden.

Household debt in relation to disposable incomes is now at the same level as just before the banking crisis at the beginning of the 1990s, just over 120 per cent. The bulk of households’ loans have in various ways been secured on homes. A number of factors can help to explain this development. In the housing market the supply of new apartments has been low since 1993 (Figure 2). In the centres of the major Swedish cities, where prices have risen most, it is difficult to build homes at all. Meanwhile, demand has picked up as a result of robust growth in households’ incomes. Disposable incomes have risen by 35 per cent since 1995, measured in current prices. Moreover, migration to the big cities has boosted demand in the very areas where the supply is most limited. During the IT boom, the demand pressure in Stockholm was high, which was reflected in prices. When the equity market and particularly technology companies dropped in value, prices in Stockholm stagnated, but they continued to rise in Gothenburg and Malmö. In the credit market, falling interest rates have of course increased demand and made households more inclined to borrow. Households may also be borrowing more because they are less uncertain than before about how interest rates and inflation will develop. The future seems more predictable, which should increase the willingness to borrow at each given interest rate level. Since the mid-1990s we have gone from a period of high, fluctuating inflation to low and stable inflation.
Whatever they decide more widely, it is clear in my view that, for a number of reasons, including the cyclical differences between our situation and that on the Continent, we cannot now be confident that this country could live reasonably comfortably with a single European interest rate. That is why I welcomed the Government’s decision last October to exercise, for the time being, our opt-out, but to plan the technical preparation for our future participation, when we are more confident that sustainable convergence has indeed been achieved. BIS Review 3/1998

The problems we encountered in communicating monetary policy, which arose in conjunction with the substantial rate cuts during the second half of the 1990s, were also a significant reason for the Riksbank's decision in 1999 to publish a clarification of the formulation of policy and the application of the inflation target.1 Among other things the clarification specified the situations in which there may be reason to deviate from the simple rule of aiming policy at meeting the target of 2 per cent CPI inflation one to two years ahead. My discussion today is based on exactly the same line of reasoning as in that clarification. The second example is taken from spring 2001. Higher food and energy prices due to foot and mouth disease and mad cow disease, as well as supply shocks in energy production, caused a sharp rise in CPI inflation. The price increases were judged to be temporary, and the Riksbank decided therefore not to raise the repo rate. As the prices rises were estimated to disappear from CPI inflation relatively quickly, there was no need in this case to depart from the Bank's simple rule of monetary policy. However there was a need in our external communication to illustrate clearly the assessment that it was mainly transitory price increases that had caused CPI inflation to be so high above target.
Interestingly, I find evidence in the early (pre-1988) sample that suggests that inflation was, if anything, more sensitive to the unemployment gap when unemployment was high, rather than low. Although these estimates are imprecise, this pattern is the opposite of the claim by HMS, which relies on full-sample estimates to draw conclusions. This also runs counter to HMS’s historical narrative about the 1960s and the dangers of a red-hot labor market. I will not dwell on this further, but it is a reminder that findings of nonlinearities in Phillips curves are often not robust. The apparent breakdown in this simple price Phillips curve in the past 30 years reflects a number of structural changes in the U.S. economy. The Federal Reserve’s success in re-anchoring inflation expectations at a low level can explain the decline in inflation persistence seen in the data.1 However, the role of well-anchored expectations in flattening the Phillips curve is not obvious, and as HMS note, this flattening is not as clear in the wage inflation equations. This suggests other forces are at work. Several usual suspects come to mind, including the effects of supply shocks, increased globalization of goods markets and supply chains, and changes in the market structure for consumer goods.

Before I continue, I’ll give the standard Fed disclaimer that the views I express are mine alone and do not necessarily reflect those of the Federal Open Market Committee or anyone else in the Federal Reserve System. Has the Phillips Curve Changed, or Is it a Trick of the Data? Throughout the paper, HMS use a reduced-form Phillips curve regression as a basis for their analysis. For my remarks, I simplify the specification and assume the inflation rate depends on the unemployment gap (and variants thereof), four lags of inflation, and a constant (relative to HMS, I have dropped the import price and inflation expectations terms). 1/4  BIS central bankers' speeches  Overall, the results for the core personal consumption expenditures (PCE) price index inflation using this simplified specification are quite similar to those reported in HMS. The full-sample (1961-2017) estimated coefficients using the core PCE price inflation rate are reported in the first column of the upper part of Table 1. The second column reports results corresponding to the “spline” specification of HMS, where positive values of the unemployment gap are added to the equation to capture asymmetry in the response of inflation to labor market tightness versus slack. The third and fourth columns of Table 1 report the corresponding estimation results for the subsample of 1961-1987, and the final two columns report the results for the subsample 19882017. Like HMS, the latter sample shows far less intrinsic persistence in inflation and a severe flattening of the Phillips curve relative to the full-sample results.
The latter are a measure of short-term liquidity – the Liquidity Coverage Ratio (LCR) – and a structural measure of liquidity risk, the Net Stable Funding Ratio (NSFR). Today, I intend to focus on the leverage ratio and the NSFR. The reason for this is that the Basel Committee has made considerable progress on these measures this year. However, before I do this I would like to briefly describe the risk-based capital requirement and the LCR, as when I speak about Sweden and Swedish conditions later I will cover all of the measures in Basel III. Let’s begin with the risk-based capital measure, which measures a bank’s capital in relation to its risk-weighted assets. This is the part of Basel III that was finalised first and it is already being applied in many parts of the world. The idea is that a bank should have sufficient capital to cover unexpected losses. Compared with previous Basel regulatory frameworks, Basel III entails higher requirements for how much common equity tier 1 capital the banks must have and stricter and more uniform regulations on what may be counted as Common Equity Tier 1 capital that is capital of the highest quality. Basel III also introduces two kinds of capital buffer as a further element of the risk-based capital requirement that could be said to lie “on top of” the minimum requirements. The buffers are intended to provide safety margins before the banks begin to use their minimum capital holdings.

Chart 1  UND1X including and excluding energy  4  4 UND1X UND1X excluding energy  3  3  2  2  1  1  0 1995  1996  1997  1998  1999  2000  2001  2002  0 2003  Sources: Statistics Sweden and the Riksbank
The business cycles of Morocco and the EU are largely synchronised and the existence of various economic transmission channels such as trade, tourism, and remittances, explain why both the European and Moroccan economies are going through a challenging period in the present global context. My speech today will focus on the global financial crisis and its roots, on the ECB’s response to the crisis and on the role of emerging market economies in the world economy. The global financial crisis and its roots Let me start by briefly highlighting the origins and evolution of the current crisis. Imagine a neutral observer who looked at the financial sector about a decade ago and then didn’t look at it again until the eve of the current financial crisis. He would have found a completely different financial industry, one which over the past decade has undergone a dramatic shift of focus. He would have discovered a financial system that had moved away from its traditional role of supporting trade and real investment. He would have found a financial system in which speculation and financial gambling had run rife. He would have encountered a system transformed – a system no longer managing genuine economic risks but one actually creating and assuming financial risks – risks resulting from arbitrage and intentional exposure to asset price changes. That same observer would have realised that financial liberalisation and innovation had made our economies more productive. The securitisation of assets, for example, had great potential to diversify economic risks and to manage them efficiently.

We now follow a “fixed rate full allotment” tender procedure and have significantly expanded the maturity of our operations. Banks have been granted access to essentially unlimited liquidity at our policy interest rate at maturities of, initially, up to six months. This is an exceptional mode of operation. In normal times we auction a given amount of central bank credit and let competition between the bidders determine the interest rate. This unusual mode of operation implies that we currently act as a surrogate for the market in terms of both liquidity allocation and price-setting. •  Our second building block is the long list of assets that we take as collateral. This list was already very long before the crisis, but we have extended it even further and now accept an even wider range of securities as collateral. •  The first two building blocks offer unlimited refinancing against a very wide range of collateral. But they can only reach the financial system if they are coupled with the third building block, namely the very large number of counterparties that have always been able to take part in our refinancing operations. Even before the financial crisis, this number was higher than for the other major central banks. Following the changes to our operational framework in October last year, this number rose further. All these non-standard measures have now been supplemented by further exceptional steps that the ECB’s Governing Council decided to take at its last meeting on 7 May.