samchain/econo-pairs-v1 huggingface dataset:
When there is a positive output gap, the circumstances are normally the reverse. Then, actual output is higher than potential output, resources are strained, unemployment is lower than normal and inflation is higher than the target level. When the economy is in balance, the output gap is closed, that is to say, equal to zero. BIS Review 64/2004  1  In practice, both actual and potential output is affected by various shocks which mean that the output gap is rarely zero. If there is a situation with a negative output to begin with, the economy can grow more rapidly than its potential output rate for a short period. The fact is that this is necessary in such a situation in order to close the gap and bring the economy back into balance. However, problems arise if the economy grows at a more rapid rate than that allowed by potential growth over a longer period of time. Then production resources become strained, bottlenecks arise and tendencies appear towards overheating. In this way, potential growth for the economy can be likened to a recommended speed from which it is important not to deviate for too long a period. It is in this short-term perspective that monetary policy can play a role in influencing growth. As the output gap reflects the demand pressure in the economy and the demand pressure in turn affects inflation, monetary policy is largely about choosing an interest rate that will make the output gap as small as possible.

Furthermore, some of the very largest commercial banks earn a substantial portion of their net revenues from the various payment and credit services they offer to the securities industry. In addition, the Federal Reserve and the Securities and Exchange Commission jointly regulate and oversee the Depository Trust and Clearing Corporation through which privately issued bonds and equities are settled in the United States. Third, as fiscal agent, the Federal Reserve provides a variety of payment-related services on behalf of the United States Treasury and other government agencies. These services include the processing of government payments as well as the creation, safekeeping, and transfer of book-entry records detailing ownership of the public debt. As an extension of these fiscal agent duties, the Federal Reserve also seeks to promote the efficient operation of the government securities market. BIS Review 93/2000  2  Fourth, the Federal Reserve oversees private clearing and settlement systems and provides payment services, principally Fedwire. These services are central to overall financial stability because disruptions in payment systems have the clear potential to impair the functioning of the financial sector and the real economy. Moreover, a major financial or operational problem at a key institution in a securities settlement system can also spill over to the payment systems that it uses and thereby have systemic repercussions. Finally, to enhance the general welfare of the US economy, the Federal Reserve promotes the efficient functioning of the payment system and helps to supply payment services.
It is essential for this supply of government debt to be organised in such a way as to enable demands of different natures to be met. This requires a well structured, transparent and predictable programme, with a wide maturity spectrum. Thus, my eighth point concerns the interaction of demand and supply to discover price reliably and efficiently. This is relevant to both the primary and the secondary markets, and is best achieved respectively through well-structured tender and market making arrangements. These may involve last resort support from the regulators. There are many successful models of such arrangements and there is ample literature on them. The common objective is to ensure a high level of liquidity to facilitate reliable and efficient price discovery, thereby providing a benchmark yield curve upon which other issuers can confidently and accurately price their own, hopefully much bigger volume of, private sector debt. That is what we should aim for in the development of the bond market if it is to play a meaningful role in financial intermediation. 2  BIS Review 94/2001  My ninth point concerns the market infrastructure, and by that I mean the payment, clearing and settlement systems. This is regrettably the most neglected aspect in the development of financial markets, not just the bond market. Imagine how general investor confidence would be damaged if the financial instrument that an investor had bought got lost in delivery.

We can, of course, replicate this financial infrastructure for other currencies, and indeed we are currently exploring the possibility of doing so for the other major international currency not domiciled in this time zone the euro. And if this is appropriate, we can also transfer our technology to others through our advisory services. I am, in particular, thinking of the RMB financial infrastructure, which in my opinion requires urgent strengthening, not just for facilitating the development of the RMB bond market, but also for facilitating the many further measures in financial liberalisation following WTO accession. Meanwhile, our US dollar financial infrastructure in Hong Kong, coupled with the market making arrangements that have been well tried for over a decade, and the critical mass of financial institutions, is ideal for the launching of a US dollar bond programme for the Mainland. I understand, of course, that with foreign reserves well exceeding $ 200 billion, there is arguably little need for the Mainland to raise additional foreign debt. But part of the outstanding foreign debt could be refinanced in Hong Kong through such a programme. Perhaps with a liquid market and a reliable benchmark yield curve established, similar to those of Exchange Fund paper in Hong Kong dollars, the overall borrowing costs could be lowered.
While the number of POS terminals in Malaysia at about 9 per thousand inhabitants is still relatively low compared to about 22 to 33 per thousand inhabitants in other advanced countries,4 the POS network is anticipated to grow with the introduction of the Payment Card Reform framework. Key focus areas to drive financial inclusion via e-payments While there are success stories globally where e-payments have helped advance financial inclusion, such success stories must be the norm rather than an exception. In this respect, the public and private sector collaboration goes to the heart of any successful policy and developmental agenda. We also need to take a longer term view rather than focusing on short term and narrow self-interests. In this regard, I wish to highlight four (4) areas that could drive financial inclusion to the next level, via the use of e-payments. These areas are: 1. Correcting price distortions and promoting competition;  2. Development and sharing of infrastructure investments;  3. Strengthening transaction security; and  4. Consumer protection and education. 1. Correcting price distortions and promoting competition  We need to address price distortions and promote competitive practices. A market driven environment would ensure that the correct price signals are provided to promote the usage of the more cost-effective payment instruments whilst injecting competition. The idea is for market players to lower cost and widen the access channels to make financial services more affordable and accessible to the general public.

The first concerns the state of the securitisation markets and that for covered bonds in particular. In Europe, the ECB routinely takes covered bonds and other private sector securities as collateral in all of its operations. And there is a perception of state support for the covered bond market, perhaps because covered bonds have often been issued by quasi-state banks. The Bank is occasionally lobbied by industry representatives to offer more support to the covered bond market. I want to make three points in response. First, that RMBS and covered bonds are already eligible collateral in both the Indexed LongTerm Repo operations and in the Discount Window Facility alongside a range of other private sector securities. 15 It is only short-term OMOs, which are conducted for monetary policy purposes, where such assets are not eligible. In order to help manage the risks arising from securitised assets, and to help improve market functioning by establishing higher standards, the Bank will be demanding detailed disclosures – to the Bank and publicly – on the underlying assets and structures. This transparency initiative has generally been welcomed by investors and we hope it will encourage the establishment of viable securitisation markets in future. 14  Further details are available on the Bank’s website at http://www.bankofengland.co.uk/markets/marketnotice100719.pdf. 15  A bank may not submit its own covered bonds in Long Term Repos, only those of other issuers. But it may submit either in the DWF.
10  Microsimulation exercises conducted by Banco de España staff confirm these trends for the overall corporate sector in 2020. According to these exercises, around half of the companies are expected post losses this year. There is, however, substantial heterogeneity within the corporate sector. SMEs and, especially, firms in sectors more exposed to the shock, such as hospitality services, leisure and motor vehicles, will be significantly more affected. The share of firms with a high debt-to-asset ratio, proxied as net debt over net assets5 above 0.75, is expected to rise by around 7 pp. This increase is non-negligible but is relatively modest given the size of the shock. This result is partly driven by the deleveraging process of the corporate sector in the years in the run-up to the crisis, which brought this ratio to moderate levels in most cases. Companies operating in sectors more exposed to the shock will see a more significant worsening in their solvency situation, with an increase in the share of firms with a high debtto-assets ratio of more than 20 pp, in some cases. In terms of the debt-to-earnings ratio, the share of firms in a more vulnerable position will increase more significantly due to the sharp reduction in earnings. In particular, the percentage of firms with a net debt of more than 10 times their earnings, or with positive net debt and negative earnings, will increase by over 15 pp. In those sectors hardest hit by the pandemic, this figure will increase by more than 40 pp.

Thus, larger and productive firms are able to reap the benefits of economic recovery and adapt to changes in the new business environment. Indeed, the difference in business performance between medium-sized and large firms in the stock market has been widening. This is evidenced by several financial indicators including the return on assets and the net profit margin. These developments partly explains why the NPL situation has yet to improve for SMEs across the board, while we see improvement in loan quality among large corporates in the same sectors. The third reason for the uneven economic recovery is the impaired function of the spending multiplier. Usually, when recovery starts to emerge in certain segments of the economy, the multiplier effect of spending should create positive spillovers to the other parts of the economy, thereby securing a more broad-based recovery over time. However, export-oriented firms which currently spearhead the ongoing economic recovery are capital-intensive. They utilize more machinery rather than relying on labor. Thus, positive spillovers to employment are less prevailing. This partly explains why the manufacturing employment growth has been rather moderate despite strong export growth and pickup in the manufacturing production index. Furthermore, having a high level of household debt, especially during the debt deleveraging period, dampens this multiplier mechanism. This is because households have to use additional income to service their debt obligations rather than spending on goods and services.
When the couple passes away, and if their children choose not to redeem the property, the bank will recover the outstanding loan with accrued interests by selling the property in the open market. Any surplus will be returned to the children of the borrowers or their designated estate. If there is any shortfall, the HKMC will take care of the difference because the borrowers, when taking out the Reverse Mortgage, have already bought insurance from the HKMC to cover the shortfall risk. This scheme would not have been commercially viable for the banks without the insurance provided by the HKMC to cover the potential shortfall risk due to either falling property prices, rising interest rates or increasing longevity of the borrowers. So far, over 2,500 households have joined the Reverse Mortgage Programme. The initial take-up rate was not fast but is picking up steadily. It has taken some time for Hong Kong people to get to understand and appreciate this new product. Also, it is quite common amongst Chinese parents wishing to pass their properties to their children without encumbrances, which will not be the case if they have joined the Reverse Mortgage Programme. However, there is increasing awareness amongst retirees that they do need to take care of themselves rather than suffering from a steady drop in living standards due to insufficient recurrent cash flows. Life Annuity Scheme 2/4  BIS central bankers' speeches  6.

When the couple reaches the age of 70, they are entitled to a non-means tested Old Age Allowance of $ $ x 2) provided by the Government. So this couple will be receiving up to $ (or $ per month or around $ (or $ per year, and have the benefit of being able to stay in their own property, for life. Compared with the median income of two-person households in Hong Kong of $ (or $ per month,1 this guaranteed monthly payout of $ would really help support a decent retirement life and protect the retirees from highly volatile market risks and from increasingly high longevity risk. Conclusion 9. I would like to conclude by making the following observations: The Reverse Mortgage Programme and the Life Annuity Scheme, when combined, will create an economic outcome similar to a life pension. This self-made pension is (a) a market based solution to provide steady cash flows for life by liquefying the fixed and financial assets accumulated by the retirees during their working life. The schemes are commercially and financially viable and will therefore not involve Government subsidies; 3/4  BIS central bankers' speeches  The launch of the Life Annuity Scheme has helped promote the annuity market in Hong Kong, which has up till now been rather underdeveloped. In 2016, the annuity business only accounted for less than 2% of all long-term insurance business of (b) private insurers in Hong Kong.
This process took painstakingly long and it was not until 1842 that full convertibility at par values against silver was reintroduced after 85 years with a paper money standard. From the time when the strategy was laid in 1822 it took more than 20 years to build enough credibility to sustain full convertibility even after Norges Bank had been successfully established. During the first century of its operations Norges Bank exercised a high degree of independence from the central government and built a reputation of credibility and confidence in defending first silver convertibility and thereafter gold convertibility. During the heydays of the classic gold standard in the four decades preceding WWI, recent research on  1  2  Dylan, Bob (1964), The times they are a-changin, Columbia studios. BIS Review 131/2008  monetary policy (Øksendal, 2008) 2 finds that credibility and confidence allowed Norges Bank more room for discretion than has previously been acknowledged. This room for discretion was used to take domestic considerations into account. This extra room for manoeuvring, however, was only available to the bank as long as its commitment to defend the gold standard was not called into question. Was this a preview of today’s modern inflation targeting regime? As long as inflation expectations are well anchored, more weight can be given to developments in the real economy. The independence of Norges Bank was de facto substantially reduced after WWII. The legitimacy of the bank and confidence in the bank had been seriously undermined during the interwar period and during WWII.

The European experience offers valuable insights in synchronising and pacing the integration process in the ASEAN region. The European path to integration -- based on trade integration, with the removal of restrictions on the movements of goods and all factors of production at the early stages, followed by increased monetary and financial linkages at the subsequent stages - presents ASEAN with an important reference point in our own monetary and financial integration efforts, in particular, in relation to the trade and investment liberalisation initiatives to facilitate greater regional economic integration. 1/2  Tremendous opportunities in ASEAN for the EU There is certainly much that ASEAN can learn from the EU experience. The EU is now the world's largest single market and with the introduction of the Euro. The EU has become the ASEAN's third largest trading partner. Of its total trade, the trade of the ASEAN 5 (that is, of Indonesia, Malaysia, the Philippines, Thailand and Singapore as a group) with the EU accounted for 12.4% in 2004. Meanwhile, the EU's trade with the ASEAN 5 accounts for 4.5% of the EU's total trade. Against a backdrop of sustained growth and macroeconomic and financial stability in ASEAN, there is significant potential for expanding the trading and investment links between our two regions. Focusing on the areas of complementarities would maximize the mutual benefits to be gained from the strengthened relationship.
The Riksbank was thereby able to slow the economic downturn and simultaneously prevent a further appreciation of the krona and a decline in inflation expectations (cf. chart 10). Interest rates in the Czech Republic touched 0% at the end of 2012, and the Czech National Bank (CNB) announced its intention to intervene on the foreign exchange market if necessary. At the end of 2013, the CNB intervened to weaken the Czech koruna and ease monetary conditions (cf. chart 11). Thus, like the SNB, the CNB also decided to use the exchange rate as an instrument for easing monetary conditions. The Danish krone, explicitly pegged to the euro since the inception of the currency union, also suddenly found itself having to contend with upward pressure. This reflected concerns about the future of the euro, and market assumptions that Denmark could become a member of a Nordic euro should the euro area split. At the end of 2011, Danmarks Nationalbank reacted by cutting its reference rate to below that of the ECB, and continued to lower it in successive steps thereafter. At the same time, it intervened on the foreign exchange market. In mid-2012, when the ECB once again lowered its rates, Danmarks Nationalbank lowered its deposit rate into negative territory in order to keep pace with the ECB’s monetary policy easing (cf.

Only a highly professional and independent institution can successfully deal with the hart times, which are not rare here. The latest example of this is the COVID-19 pandemic, which although a struggle for human health and life, is also a struggle for policymakers to maintain macroeconomic stability and reduce the impact on the economy. Therefore, I would like to express my gratitude to all current and former colleagues and collaborators, who with their contribution have contributed to what we are today – a modern central bank that operates in accordance with the latest and highest international standards and best international practices and stands out as a positive example in the central banking community. 1/2  BIS central bankers' speeches  Congratulations on the 29th anniversary of the monetary independence! 2/2  BIS central bankers' speeches
They created a “Risk Profiler” bot which is not perfect but plays a useful role in directing our enquiries. More recently, our credit union supervisors got in touch with our competition team about working on barriers to growth issues. They observed that the structure of our requirements creates some difficult cliff-edge effects for growing firms. This arises in the following way. For all deposit-takers in the UK (banks, building societies and credit unions) capital requirements go up in tiers as they get larger. This works as a “slab” system. To illustrate this let me take the perilous step of drawing an analogy with tax, perilous in that it is considered a cardinal sin for central bank officials to utter the word “tax”. You can contrast this “slab” system with income tax. When a firm’s size exceeds a certain threshold, it has to carry an extra layer of capital not only for each asset it takes on above that threshold, but for its entire asset base. To make the comparison with income tax, it’s as though if your income exceeded £ the higher tax rate of 40% was then applied not only to your earnings above £ but also to all of your earnings below the threshold. We tend to think – in line with the international consensus in Basel – that this tougher “slab” approach is a good thing for deposit-takers because it should discourage them from becoming too large too quickly.

Norges Bank’s main functions The current Norges Bank Act establishes that Norges Bank is Norway’s central bank and describes the Bank’s functions and its role as executive and advisory body for monetary, credit and foreign exchange policy. The functions described are in line with the customary functions of a central bank and follow from the Bank’s key role in financial markets. But there is little in the current Act to indicate which long-term objectives the Bank should pursue. The Commission wants to change this. The Commission proposes the introduction of an objects clause that clearly defines the Bank’s purpose. Norges Bank supports this proposal. At the same time, the Bank would emphasise that the interpretation of the objects clause must reflect the central bank’s different degree of influence over the various objectives. The central bank’s toolbox is limited, and for some objectives, the instruments available to other institutions may be more important for the result. Chart: Section 1-2 Norges Bank’s purpose – the Commission’s proposal The proposed objects clause contains two paragraphs. The first paragraph reads: “the purpose of Norges Bank is to maintain monetary stability and promote the stability of the financial system and an efficient and secure payment system”, while the second paragraph reads: “the Bank shall otherwise contribute to high and stable output and employment”. A well-functioning monetary system is a fundamental prerequisite for the efficient functioning of an economy. Norges Bank plays a key role in this context.