samchain/econo-pairs-v1 huggingface dataset:
Today, our communication on the Swiss franc is centred around two key statements: the currency remains highly valued, and the situation on the foreign exchange market is still fragile. By communicating our knowledge of the financial markets in a clear and simple way, we bolster participants’ confidence and contribute to the credibility of our monetary policy implementation. Page 6/9  A changing money market Lastly, I’d like to take a look at another market that has seen profound change since the crisis: the money market. This market is particularly important for the SNB, especially with respect to the implementation and transmission of its monetary policy. The money market has undergone two major changes, largely driven by external factors. First, the structure of the market has evolved, with the inexorable decline of the unsecured segment and concomitant rise of the secured segment; this structural change has meant that repos now take centre stage on the money market. Second – and this change is closely bound up with the first – we observe that the framework conditions within which the money market operates have been recast following the decline of the unsecured segment. I am alluding here to the replacement of the Libor as the reference interest rate for a variety of financial products, both in Switzerland and around the world. Coming back to the first point: the drop in volume for unsecured transactions, particularly on long-dated operations (more than one month), is a global phenomenon.

To be clear, the question here is not about whether CCP margin is to “blame” for the dash-for-cash. The question is did the system have enough liquidity ready in the right places to respond to derivative market volatility without adverse consequences for financial stability. Whatever we conclude, our policy response will need to take into account the whole story- including the essential role that margin played in preventing panic. We don’t want to return to the pre-Lehman world of a spaghetti bowl of counterparty credit risk. 4. Conclusion  So going back to my original questions. First, what has the experience of March and April told us about the reforms we put in place post-2008 to make the global financial system simpler? A: The headline answer is: It worked. When it comes to the crucial goal of preventing panic fuelled by a spaghetti bowl of bilateral derivatives exposures, the new system held up despite unprecedented stress. Second, where do we go from here? A: I have two recommendations:  First, we need global regulatory cooperation in order to avoid reverting to fragmentation and spaghetti. Trust based on proportionate, informed reliance. Second, if we want the simpler system to keep working, global regulators need to stay ahead of the curve and keep the system under review. We cannot ignore the fire the financial system experienced in March and April last year just because central banks did a good job putting it out. We need to look behind the walls and address any faults in the wiring.
For example, according to the survey results, fixed-term deposits are the most common financial product among households (26%), and yet they are also one of the least known (just 73% have heard of them). The population segment least aware of this basic investment product is that with the lowest educational attainment and the lowest income (around 60% have heard of them).2  1  Real assets include principal residence, other real estate property (homes, building plots, rural property, garages, industrial premises, shops, commercial premises, offices and hotels) and the value of businesses related to selfemployment, jewellery, artworks and antiques. 2  Bover, O., L. Hospido and E. Villanueva (2018) “Survey of Financial Competences 2016: Main Results”. 4  The public’s lack of basic financial literacy is also evident in their unfamiliarity with the concept of risk diversification. Specifically, the Survey of Financial Competences gauges whether respondents understand that, generally speaking, a broad portfolio of equities will offer less volatile returns than a single share. According to the survey, only half of the population understands this concept. For some years the Banco de España has been implementing its Financial Education Plan, an initiative designed to help the public better manage their personal and household finances, and to foster what we now call “financial health”. This plan has been run from the outset in collaboration with the National Securities Market Commission and more recently with the Ministry of Economic Affairs and Digital Transformation.

and in terms of residential investment, which is slowing somewhat due to a tightening of financial conditions. As I have said, the extraordinary savings accumulated during the pandemic were concentrated among higher-income households, whose portfolios are also more diversified. According to the 2020 Spanish Survey of Household Finances, real assets1 accounted for 88% of the total assets held by households below the 20th percentile of the distribution (with their principal residence accounting for 66% of the total). However, for households in the 90th income percentile, real assets represented 73% of all assets and the principal residence just 34%. Similarly, a very small percentage of low-income households have listed shares or investment funds in their portfolios (less than 3%, compared with 33% and 22%, respectively, of households in the top decile of the distribution). One factor that influences households’ investment decisions is familiarity with financial products. Indeed, as the Bestinver-IESE/CIF observatory has shown, even in a study targeted at people more likely to be acquainted with financial investments, familiarity with savings vehicles and financial decisions vary across income, age and gender groups. These findings are consistent with those of the Banco de España’s latest Survey of Financial Competences. This survey, based on a representative sample of the Spanish population aged between 18 and 79, shows broad differences in the level of familiarity with the most common financial products.
The private sector should establish medium and long-term strategies, prepare more transparent balance sheets, give importance to modern risk management principles and pay attention to research and development activities in line with corporate governance. The public sector should assume a supervisory and regulatory role within the scope of the principles of good governance and work towards creating an atmosphere in which the unregistered economic activities and unfair competition are eliminated and thus the private sector can compete in international markets as equal partners. It is also worth to note that the sequence and prioritisation of reforms are also important. That is to say, one should bear in mind that achieving the best practice on governance in this dynamic economic environment requires a carefully planned long-term reform process. Finally, I would like once more to remind you that the prerequisite of reaping the benefits of good governance is to maintain macroeconomic stability. That’s why, in every step that we will take in the future, we have to be sure to avoid jeopardizing the macroeconomic stability that we have achieved so far. Distinguished guests, Good governance principles serve as a blueprint for decision makers both at the economy-wide and firm specific levels to cope with the changing economic environment and the uncertainty that comes with it. As of today, Turkey is in a position to focus on structural and micro reforms and to improve its own governance structure in line with the European Union membership perspective.

Durmuş Yilmaz: Economic governance – the Turkish case Opening remarks by Mr Durmuş Yilmaz, Governor of the Central Bank of the Republic of Turkey, at the Conference on Current Issues in Economic Governance, Ankara, 3 April 2007. *  *  *  Ministers, academicians, bureaucrats, guests, It is an honour for me to address a distinguished audience on such an important issue. The conference will do much service by bringing forward the issue of “economic governance”, which we as the Central Bank have emphasized at numerous occasions. Let me thank Bilkent University for creating such a productive environment. Today, I would like to devote some time to highlighting the importance of principles of good governance in general and economic governance in particular. In the context of economic governance, I would also like to mention some issues on how to create good institutions. Then, I will proceed with the Turkish case and the Central Bank of Turkey. But first of all, I will start by outlining the basic definitions of the concepts I am going to use. Although the concept of governance is not new at all, in recent years it has started to be widely used in economics, especially in the development literature. While governance, or rather good governance, has been introduced as an effective tool to harness globalisation, it is not easy to define in one sentence because of its many interacting elements.
First, they demonstrate the Fed’s strong commitment to prevent lasting damage to the economy. Second, the scale and reach of the response is an indication of the gravity and unique nature of the situation we are facing. Although the facilities differ in important ways, reflecting the specifics of markets and sectors, they all share the goal of keeping credit flowing to households, businesses small and large, and other key segments of the economy. Since the announcements and rollouts of the various facilities, we have seen a significant improvement in the pricing and availability of credit.6 2/4  BIS central bankers' speeches  Somewhat paradoxically, despite the clear effect that these facilities have had on the availability of credit, actual take-up of the facilities has been relatively low. But this is in fact a measure of success—the existence of the facilities, even in a backstop role, has helped boost confidence to the point where borrowers are able to access credit from the private market at affordable rates. It’s worth noting that the Federal Reserve does not act alone. As my colleague Chair Powell says, “The Fed has lending powers, not spending powers. "7 Sound healthcare policy and the ability of fiscal authorities to put cash directly in the hands of Americans are both essential for the economy to endure this devastating episode.

The new substrate makes the notes more robust, and we expect them to have a longer life cycle; this, in turn, will have a positive effect on overall costs. Mass production of the notes, involving a new substrate, complex printing procedures and innovative security features, initially posed a few unexpected problems. This led to delays. The SNB had originally planned to issue the first denomination in autumn 2010, but it became clear that additional development work would be needed before the green light could be given for mass production. The issue date had to be postponed twice on account of these refinements. The decision to deploy a new substrate was a bold one – and turned out to be the right course of action, as it allowed us to incorporate unique security features. However, we were dependent on one supplier for the production of the Durasafe substrate, and this had consequences around two years ago. When the Durasafe manufacturer Landqart found itself facing a liquidity shortage in 2017, the SNB decided to take over the company in conjunction with Orell Füssli in order to safeguard banknote production using this unique substrate. Another key element of the new banknote series is the design. The core design elements on the notes were to be memorable and feel contemporary even years later. We wanted motifs that would not only be clear and vivid but would also have emotional appeal. Here too, we had to overcome some obstacles.
Øystein Olsen: The monetary policy toolkit Speech by Mr Øystein Olsen, Governor of Norges Bank (Central Bank of Norway), at the Centre for Monetary Economics (CME) / BI Norwegian Business School, Oslo, 8 October 2019. * * * Accompanying charts of the speech. Introduction In the wake of the financial crisis, central banks in many countries have stretched the limits of monetary policy. New, alternative policy instruments were introduced. Interest rates are still negative in many countries. Apart from in the initial hectic months after the collapse of Lehman Brothers in 2008, resorting to alternative monetary policy tools has not been necessary in Norway. Nor is there anything, in our assessment of the outlook, to suggest it would be appropriate to do so in the future. But there are no guarantees that the economy will not experience pronounced downturns in the future. Were that to occur, it would be wise to have thought through which instruments could function in Norway. Norges Bank has therefore assessed the tools that might be useful in the monetary policy toolkit. To some extent, our assessments can build on the post-crisis experiences of other countries. In some areas that are important for the impact of monetary policy, however, Norway is different from other countries. This could mean that some of the most widely used alternative tools in other countries are not a suitable option for us. I would like to share with you some of our thinking on this subject in my speech today.

However, this provision does not prohibit Norges Bank from purchasing government bonds in the secondary market. Nevertheless, there is much to suggest that the purchase of government bonds is not an option as a policy instrument for Norges Bank. There a number of reasons for this. As I mentioned previously, floating-rate loans dominate the Norwegian credit market. Unlike other countries, the level of long-term interest rates in itself has little effect on credit demand in Norway. If government bond purchases do not affect future short-term interest rate expectations either, the effect on Norway’s wider economy will be limited. Studies in other countries do not provide an unequivocal answer as to whether the bond purchases have had the strongest impact through a fall in the expected policy rate or through lower term premiums on long-term 4/9  BIS central bankers' speeches  government bonds. We have seen in earlier periods that fluctuations in Norwegian government bond yields do not necessarily influence other interest rates. There were signs of strong demand for Norwegian government bonds during the euro crisis between 2011 and 2012. Government bond yields fell fairly sharply in this period, primarily as a result of lower term premiums, but did not feed through to any great extent to the interest rates that are important for banks’ funding costs. Chart: Yields on government bonds, swaps and covered bonds Other countries’ government bond yields play an important role as a reference for other interest rates, which is not the case for Norway.
The establishment of new firms, changes in operating parameters and rationalisation in a number of industries may have contributed to this. In the first round, heightened competition affects companies’ profit margins. But enterprises will respond by reducing their costs. This will occur in part in the individual business, but subcontractors will also be required to reduce their prices and enhance efficiency. Increased competition therefore usually triggers higher productivity growth in the economy. Low inflation may thus be matched by higher productivity. In recent years, declining inflation has also been a feature in the other Nordic countries, where some of the same factors have played a role. Even though consumer prices have been low and, in some cases, falling in Norway and abroad, commodity prices in particular have shown a sharp increase. The price of coal, for example, a commodity you are well acquainted with, has shown a marked rise over the past year. Although the rise in commodity prices measured in US dollars is to some extent the result of the fall in the value of the dollar, it also reflects an increase in demand for commodities, which in turn is partly related to strong output growth in China. Prices for domestically produced goods and services are expected to rise in the period to 2005 due to higher capacity utilisation in the Norwegian economy. At the same time, domestically produced goods and services are affected by exchange rate changes, albeit with a longer lag than is the case for prices for imported consumer goods.

This will curb demand for labour and investment growth this year. Both in Northern Norway and in the rest of the country, the situation varies across business sectors. Distributive trades and enterprises supplying services to households are expanding as a result of high growth in private consumption. Production for the corporate market fell through 2003. Demand for services in this market segment will pick up in pace with increased output in manufacturing and other industries. Strong competition has resulted in substantial restructuring. In Norway and other countries, manufacturing production is being moved to countries with lower costs. This may continue. EU enlargement, with 10 new members from 1 May, may also increase competition in some industries, particularly in the service sector. Public procurement is subject to EU-wide tendering. This may imply heightened competition for the service sector in Norway and lead to further efficiency measures. Our regional network reports that demand growth is high in the construction industry in Northern Norway, primarily fuelled by public investment and the Snøhvit oil field project. Similarly, in Western Norway investment in shore-based facilities has generated a positive impetus to the construction industry. Activity in 2003 in the rest of the country has been held up by public investment projects. Information from our regional network indicates that construction activity has picked up markedly in most regions. In recent year, commercial property investment has accounted for more than a third of total investment in services and distributive trades.
Remarks at a farewell dinner in honour of Benoît Cœure, member of the ECB Executive Board Speech given by Mark Carney, Governor of the Bank of England  European Central Bank, Frankfurt 17 December 2019  I am grateful to Clare Macallan and James Benford for their assistance in preparing these remarks. 1  All speeches are available online at www.bankofengland.co.uk/news/speeches  Before I begin, I must emphasise that those who might be searching for cryptic central bank signals about future policy will be disappointed. I am speaking in the MPC’s quiet period, and my comments have no bearing whatsoever on the decision the MPC will announce on Thursday. This wonderful evening celebrates an extraordinary individual. There should be, and will be, great joy and immense gratitude. But as with all such occasions there is also the melancholic feeling of an end of an era, the passing of the ancien regime. Certainly, central banks face many challenges:   Markets prone to severe bouts of illiquidity;    A global economy that risks falling into a low growth, low inflation rut caused by deep structural forces, limited policy space, and growing concerns over the fracturing of the global trading system;    Innovations in private payments encroaching on central banks’ very raison d’être, the provision of money; and    A growing climate crisis that will affect every aspect of finance. So it is tempting to ask: Après Benoît le déluge?

In tribute to the Governor, as I know that Fernando Pessoa is one of his favourite poets, I'd like to quote his “Odes by Ricardo Reis”, in which he reminds us of the importance of being truly committed to our work. “To be great, be whole: don’t exaggerate Or leave out any part of you. Be complete in each thing. Put all you are Into the least of your acts." Thank you all for being here. 5/5
Without sensible economic policy implementation, however, the construction programme would be likely to lead to overheating of the economy, high inflation and instability. There is no the scope to discuss the Bank’s analysis further here, however, so I shall merely refer to the coverage in the latest Monetary Bulletin. In recent public discussions it has repeatedly been claimed that the exchange rate of the króna is too high and the Central Bank needs to take measures to bring it back down, such as a large-scale cut in interest rates, which are said to be much higher in Iceland than elsewhere. The fact of the matter is that the interest rate differential between Iceland and its main trading partner countries has narrowed significantly recently. The short-term interest rate differential has not been less since 1996. The Central Bank of Iceland’s policy rate is now lower than, for example, those of the Norwegian Central Bank and the New Zealand Reserve Bank, both of which also apply inflation targeting. The same applies to the policy rate in real terms, calculated relative to these banks’ respective inflation targets. In fact, in real terms the Central Bank of Iceland’s policy rate is at its lowest point since 1996. In this context it is also important to point out that after the change in the monetary framework in March 2001, i.e.

The Central Bank will continue to base its interest rate decisions on its mandatory role of contributing towards price stability and on the joint declaration of the government and the Bank from March 2001 which specifies the inflation target. Through steadfast monetary policy which ensures price stability, monetary measures will contribute towards promoting a stable economic environment which is the foundation for the economy’s growth capacity in the long run. On the basis of the new inflation forecast and national economic forecast, the Central Bank announced a cut of 0.5 percentage points in the policy interest rate on February 10. The Consumer Price Index for the beginning of February was published this morning and the change in it turned out to be fully consistent with the Bank’s latest inflation forecast. Developments in the next few weeks and the prospects ahead will determine the next step as regards interest rates. Opposing trends are at work there and at present it is impossible to state in which direction or when the next step will be taken. It also needs to be underlined that if the current outlook turns out to be correct, the proposed construction programme in east Iceland will gradually begin to influence the formulation of monetary policy. To conclude, I would like to reiterate that monetary decisions by the Governors of the Central Bank of Iceland are made after extremely careful consideration of a large number of indicators.