samchain/econo-pairs-v1 huggingface dataset:
The 1970s and 1980s were characterised by the attempt of central banks to find a new model for the design and implementation of monetary policy. Many central banks were then subject, in one way or another, to government control, which led to an excessively accommodative monetary policy. The result was the emergence of high rates of inflation accompanied by poor economic growth and sharp increases in unemployment. This prompted the rethinking of the role that central banks ought to play in the economy and of how they should act when performing this role. The current framework for the conduct of monetary policy The experience of the 1970s highlighted the importance of giving central banks a clear and credible mandate based on control of inflation and the achievement of price stability, as the basic objective to support growth and macroeconomic stability in the medium term. With this objective, since the 1990s central banks have been accorded an extensive degree of autonomy to isolate their decisions from political considerations that might interfere with their central mission of ensuring a moderate level of inflation. The Law of Autonomy of the Banco de España of 1994 was approved in this context. Likewise, the treaties establishing the European Central Bank are clear as regards its independence and main objective, namely the maintenance of price stability within the euro area. In the case of the European Central Bank, its objective is to maintain inflation rates below, but close to 2% over the medium term.

These jobs account for a good part of the 22,000 net jobs the financial sector has created during 2016–2019. Our FinTech start-up community has grown exponentially – Five years ago, we had about 50 FinTech firms; we now have more than 1,000. Last year, FinTech firms attracted a record $ billion of investment. For the first half of this year, despite COVID-19, the FinTech sector continued to attract equity funding and M&A amounting to $ million. The FinTech sector has been a powerful creator of jobs. We estimate there are nearly 10,000 people employed by FinTech firms, many of which are also classified as part of the financial services sector. We have seen many examples of innovative solutions that use technology to meet the daily needs of consumers of financial services. The Proof of Concept (or POC) Grant, under FSTI, provided funding support for experimentation, development, and dissemination of such solutions. One example of successful commercialisation is SoCash, who partnered with Standard Chartered Bank to pioneer micro cash distribution in Singapore, by turning any retail shop into an ATM alternative and allowing users to withdraw cash at the checkout. SoCash subsequently raised $ in Series B funding to expand its distribution network into overseas markets such as Indonesia, Malaysia and Hong Kong. The financial industry has begun to make progress in frontier technologies like AI. The AI and Data Analytics (or AIDA) Grant, under FSTI, has helped to promote the adoption and integration of AI and data analytics in financial institutions.
It also begs the question of what is preventing the diffusion of processes and technologies used in one firm to other firms operating in a similar region or sector. Are there barriers to technological diffusion, legal or competitive, which are stymieing productivity trickle-down? Are first-mover advantages and economies of scale simply larger for frontier firms these days, entrenching their advantages? Could more be done by frontier companies to promulgate their practices to companies lower down the supply-chain? I do not know the answers. But finding them strikes me as key for unlocking the growth and productivity potential of the long tail of companies and hence of UK PLC. Conclusion  The UK, perhaps more than any other country in the European Union, is an agglomeration of quite different micro-economies – micro-economies of high and low incomes, high and low skills, high and low investment, high and low productivities, Red and Blue Car regions. Closing these gaps would not only boost the size of the aggregate economic pie, but would lead to a more equitable distribution of its slices. 15  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  15  As much as anywhere in the UK, the North-East exemplifies some of those challenges. Incomes and productivities are towards the bottom of the UK league table and unemployment rates towards the top. In many ways it could be seen as a Red Car region. With these differences so large, it would be easy to view the UK glass, economically and socially, as half-empty.

When this kind of shock occurs, whether it is a question of lower or higher inflation, it is reasonable to allow the effects to dissipate gradually and not to act too strongly with the interest rate. One feature of the debate on monetary policy in the past year has been more or less fanciful assessments of how much higher employment could have been if only the Riksbank had acted more prudently. The figures have varied from 20,000 up to 75,000 more jobs. It is certainly not easy to make these kinds of counterfactual estimates; I admit that much. They require some rather bold assumptions. They presuppose not only that the Riksbank would have been considerably more successful than all other forecasters in assessing where the economy is headed. They also presuppose that we would have succeeded in convincing external parties of this in advance, and would have done so at least partly during a period when inflation in Sweden was clearly above the 2 per cent target. In order to get an idea of what the effects on employment of a different interest rate policy could have been, we have conducted a couple of experiments ourselves. They show that it would have been difficult to achieve employment effects over 10,000 people even if the repo rate had been a whole percentage point lower in the past year.
The development of a strong core of Singaporean leaders in finance, working in diverse global teams, will define our continued success as a financial centre. MAS takes this very seriously. BIS central bankers’ speeches  5  44. We have in recent years introduced several initiatives to promote the development of Singaporean leaders in the financial industry. •  The Finance Associate Management Scheme (FAMS) offers promising young professionals exposure to different aspects of a financial institution’s global operations and mentorship by senior leaders. •  The International Posting Programme (iPOST) has supported more than 35 overseas postings of Singaporeans in finance since its launch in 2013. They have acquired valuable practical experience in diverse working cultures over their 6 to 24-month attachments to regional and global offices of financial institutions. Asian Financial Leaders Programme (AFLP) 45. To further strengthen these efforts, I am pleased to announce the launch of the Asian Financial Leaders Programme (AFLP). •  The AFLP will take advantage of Singapore’s strong and expanding linkages in the region, including ASEAN, China and India, and aim to strengthen those links through leadership development. •  It is aimed at equipping finance professionals aspiring to C-suite roles with the knowledge and capabilities to operate effectively across diverse business, regulatory, and legal environments. •  Participants will be given the opportunity to learn from and interact with top policymakers from the region and to also build networks with fellow financial sector leaders.

Tharman Shanmugaratnam: Singapore – a widely respected centre of Asian and global finance Keynote address by Mr Tharman Shanmugaratnam, Chairman of the Monetary Authority of Singapore, at the Association of Banks in Singapore (ABS) Annual Dinner, Singapore, 30 June 2015. *  *  *  Chairman and Council Members of the ABS, Ladies and gentlemen, 1. Thank you for inviting me to join you this evening. 2. We meet at a time of renewed uncertainty in global finance. Greece has imposed capital controls and declared a banking holiday to stem a full-blown financial crisis. 3. No one has been able to predict each step in the game of brinkmanship that we have seen over the last few weeks. But the underlying reality of a sharply deteriorating economy in Greece, and the prospect of bankrupt Government, has not been a surprise. It is too early to say if some form of Grexit becomes a reality, but it is a contingency that Eurozone governments and financial institutions have been preparing for. 4. The direct impact of a collapse of the Greek economy is not significant, even in the Eurozone. The ECB and the EU are also likely to take all steps necessary to safeguard the Eurozone financial system in the coming weeks. Markets have hence not shown great panic, with credit spreads widening only slightly in the Eurozone periphery. 5. But there are downside risks we should be mindful of.
A key weakness as far as Sri Lanka’s exports structure is concerned is a lack of diversity in products and markets, as well as low complexity in the export basket. Exports continue to be  concentrated on two traditional products, namely garments and tea, which account for more than half of total exports. No major export item has been developed since the 1990s. The Export sector shows Page 6 of 17  a lack of diversification in terms of markets as well. Europe and the USA continue to account for over half of total exports. Further,  approximately 70% of tea exports are to the Middle East and Commonwealth of Independent States, where demand is sensitive to oil prices which have been transformed by shale technology. The absence of effective trade finance also contributed to the subdued promotion of exports. At present, despite the share of  industrial exports being around 77% of total exports, it is estimated that high-tech exports account for less than 1% of Sri Lanka’s total manufactured exports. Improving this ratio entails investment in machinery, technology and skilled labour. It is necessary for our exporters to compete in complex products that are more technologically advanced. We are no longer a low wage economy, therefore we need to invest in, and become competitive in fairly complex export products, if we are to meet the aspirations of our people. Now, there was, I think, a very legitimate question asked about the availability of labour.

The three points in the 2 chart reflect different types of inflation targeting. Strict inflation targeting means that only the variation in inflation is included in the loss function. No weight is given to output changes, thereby resulting in relatively high output variability. Monetary policy has the swiftest effect through the exchange rate channel. If inflation is higher than the inflation target, the central bank will raise its key rate sharply to reduce inflation quickly. This may lead initially to a relatively strong appreciation of the currency, which reduces imported inflation. As CPI inflation quickly approaches the target due to the change in imported inflation, demand is also reduced as a result of a higher real interest rate and stronger exchange rate. The change in demand will then influence inflation. In order to avoid a further reduction in the inflation rate, the central bank will lower the interest rate. The result of this policy will be considerable variations in nominal and real interest rates, accompanied by substantial variations in the nominal and real exchange rate and in output. Flexible inflation targeting implies that the central bank also puts some weight on output and employment variability. Output is therefore also included in the loss function. This means that the central bank will attempt to avoid the sizeable variations in output resulting from strict inflation targeting. The way to take account of output and employment under a flexible inflation target is to choose a relatively long time horizon.
2  BIS Review 43/2007  there have been significant changes in the dynamics of inflation since the MPC was set up.4 Table 1 shows the mean, standard deviation and persistence of inflation over various periods. Inflation has been significantly lower on average, less variable, and fluctuations in inflation have tended to be less persistent. More generally, the impact of the MPC is revealed by what I have called the “Performance” and “Stability” charts – charts 2 and 3. In terms of average rates of output growth per head and of inflation, charts 2a and 2b show the relative position of the UK economy among the G7 as a whole both before (taken here to be the period 1950 to 1996) and after (1997-2006) the creation of the MPC. Ideally, a good performance means that a country would be towards the top right hand corner of the charts – inflation is plotted on an inverted scale. The average record on growth and inflation over the period 1950-96 (chart 2a) was not good relative to the rest of the G7. Indeed it was arguably the worst. In contrast, after the MPC was set up the United Kingdom performed better than most if not all of the G7 countries. So although changes in the world economy may have proved helpful to achieving lower inflation, the fact that the UK improved not only its absolute but also its relative performance – moving from last to first in the G7 league table – is encouraging.

Newly listed companies were a prime lending target of both local banks and the many foreign banks that had established offices in Hong Kong. Having done so, local management needed to justify the existence of these offices and were keen to lend to companies whose newly listed status seemed to provide an image of financial respectability. During this period Hong Kong experienced the shift away from relationship banking that has been seen in other markets around the world. It was not unusual to find even medium sized companies with dozens of bankers. Companies often ended up with more cash than they needed and in a number of cases this was channeled away from core businesses into ill-advised diversification or into speculative ventures in the stock and property markets. Typically these property ventures were in Mainland China and came to grief when austerity measures began to be enforced there from 1993 onwards. Problems with medium-sized corporates in Hong Kong had therefore surfaced even before the onset of the Asian crisis. But the crisis accentuated the problems and reduced the chances that the companies concerned could turn themselves around. In the light of this, coupled with the fact that the prolonged nature of the crisis is putting the finances of even well-managed companies under strain, it should come as no surprise that the main bad debt problems of the Hong Kong banks have surfaced in their corporate lending.
Monetary policy could obviously have been given a more expansionary turn than was the case at the end of 1996 and during 1997, in which case UND1X inflation might have been higher and more in line with the 2 per cent target, quite apart from the interest expenditure effect on the CPI. In this context one can, of course, discuss the Riksbank’s basic forecasts of inflation excluding the transitory effects from interest expenditure and taxes. The Riksbank made a forecasting error in failing to foresee the economic slowdown inherent in the Asian crisis and the ensuing fall in commodity prices. Unfortunately, you might say, we shared this error with a clear majority of observers. With the long time lag that applies to monetary policy, measures should really have been taken before the end of 1996 or early 1997, which was before the crisis had even arisen. If the commodity price fall does not leave any traces in inflation expectations, it should not affect policy either. CPI and underlying inflation in a longer perspective4  10. CPI and underlying inflation The estimated indicator of underlying inflation broadly corresponds to UNDINHX (see Inflation Report 1999:1) Determinants of inflation: Underlying inflation  1. Expected inflation trend 2. Economic situation 3. Supply shocks, e.g.

In this case, small changes in the reference rate cause relatively large adjustments to long-term rates – the monetary policy transmission mechanism is working. The inflation risk premium and capital market rates are low. Lower interest rates mean lower funding costs for the government. However, if the government seeks capital market funding, another factor comes into play in addition to inflation expectations and the inflation risk premium: the credit risk premium. The more sustainable the public finances, the greater investor confidence will be. This leads to a lower credit risk premium. This makes public finances more affordable, which in turn reduces credit risk. Monetary policy also benefits, because the transmission of monetary policy stimuli is not impeded. In this way, sustainable monetary and fiscal policy together achieve greater stability, less uncertainty and lower rates. Let’s now turn to the real economy (cf. chart 3). On the one hand, lower interest rates mean lower funding costs for companies and private households. This provides favourable conditions for economic growth but does not create it per se. Growth itself is founded on productivity gains, population growth and capital formation. A stability-oriented monetary policy allows households and companies to make their economic decisions (work, consumption, saving and investment) in a less uncertain environment. In this way, the  1  Swiss Federal Constitution, Art. 126 (budget): “The Confederation shall keep its expenditure and receipts in balance in the long term”; art. 100 (economic policy): “In their budgetary policy, the Confederation, Cantons and Municipalities shall take into account the economic development”.
Over the last couple of years markets have exhibited a number of features which arguably give us a foretaste of some of the future consequences of climate change, depending on how the climate transition pans out. Here, I am thinking of the disruption to world energy and commodities markets, global supply chain problems and, most recently, the threat of food insecurity. It would be easy to attribute each of these issues to specific triggers, such as Covid or the war in Ukraine, and not think about the bigger picture or what they could tell us about the “new world”. In the “new world”, these are exactly the sort of disruptions we can expect to become more common and more severe as a result of climate change. They should not be considered as one-offs and are unlikely to just go away. It is important that firms take action now to learn the lessons from current events and make sure that they are well prepared for when similar events happen more frequently in future, for example bumpy rides in commodities markets. Thinking back to the example I discussed earlier of making sure that firms consider counterparties’ liquidity profiles as well as their capital adequacy in their credit assessments of commodities clients, investment banks should also think about how those counterparties might be exposed to climate risk.

The challenge before us is to build a new financial architecture that would allow for the more efficient functioning of not only financial intermediation within national economies but also across borders. Islamic finance, with its emphasis on a strong linkage to productive economic activity, its inbuilt check and balances and its high level of disclosure and transparency offers this prospect. Indeed, inherent in Islamic finance is the explicit elements that address several of the issues that have surfaced in the conventional financial system during the current crisis. Given the global dimension of the current crisis, the accelerated pace at which it has spread and the severity of its repercussions, it has called for a higher degree of collective determination by the international community to work together towards developing a global strategy that will evolve a financial system that is stable and sustainable over the entire business cycle. As Islamic finance continues to become an integral part of the global financial system, it will increasingly be exposed to risks of financial stress arising from global financial instability and global economic activity. This necessitates a greater global engagement between those that are driving the reform agenda given that it will result in new structures, standards and regulatory regimes for the industry. This is particularly important  BIS Review 123/2009  1  when such standards become the basis on which assessments are made by multilateral agencies, rating agencies and the market at large.
Lastly, the Supervisory Council reiterates the need to continue and deepen structural reforms, which boost productivity and enhance the competitiveness of the Albanian economy. These reforms pave the way for expanding the economic potential and should be seen as the main instrument supporting sustainable and long-term growth for Albania. BIS central bankers’ speeches  3

Chart 2: The increase in corporate insolvencies has been driven by micro firms Monthly business insolvencies by size over time (number of insolvencies) (a) (b)  (a) Sources: The Gazette and Bank calculations. (b) An insolvency is recognised at the point a liquidator is appointed. Micro firms have less than £ in assets, small firms between £ and £ medium firms between £ and £ and large firms above £  Page 6  Chart 3: The debt-weighted share of low-ICR firms has increased but remains below the GFC peak Debt-weighted share of companies with interest coverage ratios below 2.5 (a) (b)  (a) Sources: Moody’s BvD, S&P Global Market Intelligence and Bank calculations. (b) These data refer to UK PNFCs only. The projected number for end-2023 is based on the February Monetary Policy Report. We use 2.5 as a threshold as companies with interest coverage ratios below 2.5 are materially more likely to experience repayment difficulties. We are also alert to risks not directly visible on balance sheets (relating to off-balance sheet instruments like derivatives for instance). Energy firms for example have relied extensively on derivatives to hedge against price movements. And the rise in energy prices last year triggered margin calls on those derivatives that put some firms in immediate liquidity stress. The Bank and HM Treasury’s Energy Markets Financing Scheme was initiated to ensure that liquidity stress did not turn needlessly into insolvency. We can also see some evidence of the borrower resilience channel at play, with investment intentions distributed unevenly across firms.