samchain/econo-pairs-v1 huggingface dataset:
I would now like to spend a little time commenting on some of these figures. The first observation we can make is that the different strategies have contributed differently to excess return. The contributions of some strategies have been negative, while the contributions of others have been positive. The second observation we can make is the relatively high contribution to excess return from our enhanced index strategies. This strategy is not passive. It requires active decisions, every single day. It is up to NBIM’s equity and fixed income traders to decide on the details of purchases. They must decide when, where and how trades are to be made. Such choices affect day-to-day asset management – also where indexes are tracked the closest. The organisation trades on over 250 exchanges and sees to settlement, valuation, custody and risk management. In 2019, we executed around 30 million equity trades, or an average of approximately 100 000 trades per day. This is more than all of Oslo Børs. Trading runs full steam around the clock, despite large operational challenges owing to the Covid-19 pandemic and considerable market volatility. Allocation divides the fund’s assets among asset classes and markets. As a part of this, a relatively substantial negative contribution to the fund’s return has come from our fixed income investments in emerging markets. Our experience is that we have not been paid enough for the risk to which some of these markets are exposed.

The Bank’s investment management organisation analyses these companies thoroughly, in order to identify long-term investment opportunities, reduce the Bank’s exposure to undesirable risk and the like. We use such analyses in order to safeguard the portfolio. There are companies 3/5  BIS central bankers' speeches  where we prefer not to be an owner. If we see that a company has a business model that we do not regard as sustainable, it may lead to divestment. But unlike the ethically justified divestments, these risk-based divestments are justified by purely commercial considerations. All together, the fund has made risk-based divestments of 282 companies since 2012. The first divestments were of palm oil companies, whose activities entail destruction of rainforests. Since then, the fund has divested of a number of other companies, where the common denominator has been that we have observed inadequate management of risks such as those related to the environment and climate change, corruption and human rights. Chart: Return effects of risk-based divestments Our experience from this work has been favourable. We exploit the fund’s characteristics, primarily its long-term horizon, to reduce risk and – in any case as it appears today – also to improve the fund’s return. Since 2012, risk-based divestments have contributed to increasing the return by an amount equivalent to around 0.27 percentage point of the value of the fund’s equity portfolio, measured against the benchmark index. This is the equivalent of around NOK 7 billion.
Another risk stems from a continued weakening of the dollar, although this may be motivated to the extent that it contributes to easing the adjustment to smaller deficits in the United States' budget and current account. The problem is that there is a risk of negative effects on exports, production and employment in the euro area and also Sweden. Adjustment problems and the effects on activity in the world economy could prove problematic if the dollar continues to depreciate at a rapid rate. However, there are also factors indicating that inflation could be higher than in the main scenario. The impending wage bargaining rounds comprise one risk. The Riksbank's current assessment is based on the assumption that a weaker labour market will hold back the rate of wage increases. However, there are examples of wage bargaining rounds where wage formation has got out of control despite a low demand situation, for instance, in 1995. The conflict concerning the Municipal Workers' Union is evidence of tensions in the labour market, which could have the effect of pushing up wage costs. No single factor is as central to inflation trends - and thereby to monetary policy - as wages. The Riksbank will therefore follow the development of the wage negotiations closely during the autumn. Another risk stems from energy price trends and in particular developments in electricity prices. The monetary policy stance so far has been based on the energy price rise being of a transient nature.

This gives me reason to underscore the worrying signs that I perceive, especially at an opportunity like this, when I before you in the Riksdag Committee on Finance speak about how I see monetary policy and the Swedish economy in the future. This does not mean, however, that I am going to embark on a discussion of different concrete solutions to the problems. I don't believe that this is a natural task for us at the Riksbank. Over the last ten years, the task of monetary policy has been to safeguard price stability, that is to say, a low and stable inflation rate. This has worked fairly well; inflation has been largely in line with our target. In turn, this has contributed to relatively good economic growth, in clear contrast to the 1970s and 1980s. However, this is not enough. No matter how well stabilisation policy functions, it does not provide higher long-term economic growth. In reality, growth potential and thereby our welfare is determined by how much we work and how productive we are. Nothing can change this. The amount that we work depends on many different factors, for instance, how many people are of working age, how many of theses are employed, absenteeism, etc. Labour productivity, measured as GDP per hour worked, depends partly on the level of education and on technological progress or the prevailing conditions for businesses and investment. To this can be added productivity changes resulting from the labour force moving over from less productive to more productive sectors.
This is a reasonable comparison if  one considers that the purchases have had a negligible effect on the real economy and inflation. If, on the other hand, it is judged that purchases of government bonds contributed to making monetary policy more expansionary and that the policy rate was not at its effective lower bound, one should instead compare it with a scenario without purchases but with a lower policy rate. 36 This is partly because some depreciation of the value this year will be offset against increases in value from previous years that have so far been recorded in the revaluation accounts, and partly because the Riksbank has other assets, mainly in the gold and foreign exchange reserves, which are also affected when interest rates rise. 37 Kjellberg and Åhl (2022) presented estimates for the Riksbank's results based on market prices at the end of the first third of this year. Since interest rates have continued to rise, it is likely that the loss this year will be even greater than they reported. 20 [30]  banks, such as the Czech National Bank, have had negative capital for a long time.38 Table 4. The Riksbank's capital and reserves at the beginning of the year Equity Risk provisions Revaluation accounts … Swedish government bonds … foreign securities, price … foreign securities, currency … gold  Total  66 5 89 9 3 21 55  161  Note. SEK billion. Refers to the Riksbank's financial position on 31/12 2021.

Constantinos Herodotou: A resilient banking sector in an everchanging economic environment Speech by Mr Constantinos Herodotou, Governor of the Central Bank of Cyprus, at the Deloitte Annual Conference, Nicosia, 28 September 2022. ***  Introduction Distinguished co-speakers and guests, ladies and gentlemen. Thank you for inviting me to this conference. It is a pleasure to have this opportunity to speak to you today. I will start with a brief overview of recent euro area and Cyprus economic developments and the monetary policy decisions taken in response to the new challenges of persistently high inflation and elevated economic uncertainty. I will continue with the developments in the Cyprus banking sector which needs to address a number of challenges in this fast evolving economic environment. Euro area Euro area economic developments In the euro area in general, GDP is growing at a slower pace this year than previously expected due to the negative geopolitical developments, mainly caused by the war in Ukraine. Growth is hampered by soaring energy and commodity costs, low confidence and supply chain disruptions. At the same time, inflation is approaching double digits, and a winter with possible energy shortages and high energy prices is on the horizon. Nevertheless, a recovering tourism industry, decreasing unemployment, and EU funding payments help to boost activity and limit, to some extent, output loss. More specifically, the Euro area quarterly economic growth reached 0.8 percent in the second quarter, following a 0.7 percent rise in the first quarter.
In Norway, the Banks' Standardisation Office establishes the standards for payment services. The Banks' Payment and Central Clearing House (BBS) and EDB Fellesdata produce most of the payment services in Norway. In some areas, the two companies produce different kinds of services, while in other areas, they compete in the same market. This solution exploits economies of scale in the development and production of payment services. 6  BIS Review 66/2002  Reduction of risk in the payment systems Risks in payment systems have received increased attention in the 1990s, both internationally and here in Norway. An average of NOK 160-170 billion is settled in Norges Bank’s Settlement System every day. In addition, a number of banks settle transactions in Union Bank of Norway and Den norske Bank. If a bank is incapable of timely settlement, the settlement systems may be a source of financial instability. The settlement systems may also contribute to spreading liquidity and solvency problems. The Committee on Payment and Settlement Systems (CPSS) in the Bank for International Settlements (BIS) has established 10 core principles with which all systemically important settlement systems must comply in order to limit risk in the payment system. Norges Bank's assessments indicate that all the important bank-operated settlement systems in Norway that have been authorised, i.e. the systems operated by Union Bank of Norway, Den norske Bank, NICS (Norwegian Interbank Clearing System) satisfy these 10 core principles. 10.

Growth has been good and this has contributed to maintaining demand for working hours. At the same time, demographic developments have been relatively favourable and there have been ample unutilised resources in the economy following the crisis of the 1990s. However, when it comes to the labour supply, there is less reason to be optimistic about future developments. Developments in working hours have been held back during recent periods for structural reasons. The demographic situation, with a declining percentage of the population of working age, will deteriorate significantly in the long term, particularly after 2010. In addition, working hours per person may instead tend to decline in the long run when greater prosperity is taken advantage of to increase leisure time. The assessment in the October Inflation Report is that employment, labour force participation and mean working time will rise during the economic upturn forecast for the coming years and will contribute to an increase in the number of hours worked of approximately 1 per cent a year during the period. In a longer perspective, it is more realistic to assume that the labour supply will not make any contribution to growth. The simulations in, for instance, the Long-term Planning Commission’s most recent report, indicate that the number of hours worked on average will not show any significant change. However, the simulations show that the situation could be improved significantly, at least in the short term, if measures were taken to increase the labour supply.
In response to these developments, with the aim of halting this deterioration both in inflation and inflation expectations and of attaining medium-term targets, the Central Bank of Turkey has effectively used the short-term interest rates that are the main policy instruments of the Bank and has exercised strong monetary tightening, by raising policy rates by 425 basis points to 17.5 percent. After this strong monetary tightening, the fluctuations in financial markets started to settle and the medium and long-term inflation expectations started to improve. Thus, in August, inflation expectations over the next 12 and 24 months declined to 7.94 and 6.02 respectively. It should be borne in mind that the impact of interest rate decisions on economic activities and inflation can be observed only with a time lag. It is advisable to take this fact into account while making the analysis and evaluations. As for the future inflation outlook, we foresee that the negative effect of the depreciation of the New Turkish lira on inflation will gradually diminish as was the case in August. BIS Review 89/2006  3  Although we have achieved rapid recovery and relative stability, the environment created by the fluctuations observed in financial markets in the May-July period are expected to weaken domestic demand in the second half of the year. Meanwhile, analyzing recent data such as those pertaining to investor confidence and to the expectations for domestic sales and orders for the next quarter, it is foreseen that the decline in domestic demand will not be a very sharp one.

While employment in the agricultural sector decreased by 3.6 percentage points compared to the same period last year, employment in the services sector rose by 2.9 percentage points. In this context, the share of the agricultural sector in total employment fell from 38 percent in 2001 to 28.4 percent, as of May 2006. However, taking into account that this ratio was 3.7 percent for EU-15 countries in 2004, Turkey still has a long way to go. Similarly, when we look at the labor force participation rates, we see a significant discrepancy. The labor force participation rate, which fell by 0.7 percentage points and became 48.6 percent in Turkey in May 2006, compared to the same period last year, was around 65 percent for EU15 countries by the year 2004. Meanwhile, a relative improvement is observed in unemployment rates. The unemployed population and the unemployment rate are at their lowest levels since the third quarter of 2001. Compared to the same period last year, the unemployment rate decreased to 8.8 percent from 9.2 percent in May. During the same period, the unemployment rate in sectors excluding agriculture fell by 1 percentage point and became 11.5 percent. Similarly, it can be said that there is a relative improvement in the unemployment rates in urban areas. The unemployment rate, especially among the young population  8  BIS Review 89/2006  in urban areas, decreased by 2.3 percentage points and fell to 19.4 percent from 21.7 percent.
But it is also likely that there is less slack in the economy than implied by the deviation of productivity from its pre-crisis trend. Looking ahead, the degree to which the margin of slack is eroded will depend on the outlook for demand. If demand recovers strongly, that would close up the degree of slack in the economy. But if demand stays weak, then potential supply will gradually respond downwards, also closing the margin of slack (although that process would probably be slower than if it was faster demand growth doing the work). BIS central bankers’ speeches  7  The risks from inflation expectations are also difficult to assess, principally because we do not have good data on the true expectations of businesses and wage bargainers, only what they record in surveys. Personally, I look for signs of de-anchoring inflation expectations in two places. The first is in nominal wage growth, which as I have discussed earlier, remains subdued. The second is in financial prices, where we can extract information on inflation expectations by looking at the differences between the yields on conventional and indexlinked gilts or by looking at inflation swap markets. These data – like any other – need to be interpreted and analysed with caution. Financial markets are prone to bouts of volatility. The instruments are linked to RPI and not CPI inflation. The short maturity end of both the gilt and the swap markets are relatively illiquid, and the long-end of the markets can be moved around by structural demand (e.g.

There are actually structural reasons why Thailand is a safe place to do business and a place where risks of economic shock, economic downturn, or significant economic crisis are  Page 5 of 11  very low relative to almost any other countries in the region. If you look at the causes where a country typically experiences an economic crisis, what are those? A country sometimes might have the foreign exchange or balance of payments crisis as they run out of reserves and have too much external debt. Yet, Thailand, unlike other countries in the region, our vulnerability on this front is extremely low. We have a very low level of external debt relative to our foreign reserves which exceeds 200 billion dollars while our short-term external debt is significantly below that. Our current account has been traditionally in very large surpluses. Therefore, the risk of having a baht crisis, like what we had in 1997, remains extremely low. What are other kinds of crises? Another kind of crisis that people experience is the fiscal crisis. If you look at the Thai governments’ balance sheet, it is relatively strong, the public debtto-GDP ratio is just over 50 percent and the fact that the government is able to borrow 10-year money at only 1.7 percent indicates that people are still willing and happy to finance the government. They do not see the government as having a very high risk.
For this very reason, the award ceremony for the best diploma thesis has become a consolidated activity of the Bank of Albania geared toward supporting promising students in the field of scientific research within the scope of central banking. This year, students also showed a high interest in presenting their diploma theses. We received 1/2  BIS central bankers' speeches  27 studies on a wide range of economic, financial, and legal topics focused mostly on the Albanian economy. It is a delight to see how these studies use contemporary research methodologies and valuable information intelligently to analyse economic phenomena, employing theoretical and empirical arguments. In spite of the challenge of choosing the most interesting studies, we now have our verdict on the “Governor’s Award for the Best Diploma Thesis 2018”. The selection has not been easy. Each year, we receive increasingly more qualitative studies in terms of research methodology, topic originality and methods applied in research. I take this opportunity to congratulate all the contestants for the high quality of the presented studies. I hope and encourage you to further enrich your theoretical and empirical capacities as you advance in your careers, wherever that may lead, in academia or as experts in specific fields. I hope you will be unremittingly engaged in scientific research, in a relationship of which only the starting date is known. Thank you and happy holidays! 2/2  BIS central bankers' speeches

Third, wage increases of the past three quarters affect current wages with a summed coefficient of less than 0.5, implying that lagged impulses fade within a few quarters. Fourth, the effect of price pressures on wage increases is empirically weak; wages respond less than proportionately to prices during the year. Combined, these estimates suggest that the pass through from costs to domestic prices is subject to relatively contained momentum and feedback effects. But the entire course of the pass-through process is still characterised by a degree of persistence. Accordingly, in the absence of further major global price shocks, domestic inflation should not accelerate further in Q4, but could remain elevated relative to the historical average. A key upside risk factor influencing the ongoing pass-through to consumer prices is the behaviour of cost mark-up by businesses. Profit margins might have been impaired in the earlier period when global costs shocks were intensifying, and businesses might be inclined to restore them at least partially in the period ahead. Monetary policy stance has progressively tightened Singapore’s short-term AS curve is gradually shifting to the right as global costs subside and non-resident worker inflows pick up. Wages in the first half of the year traced out a temporarily steeper portion of the Phillips Curve but are expected to revert to their historical configuration in the period ahead. The external components of the IS curve could moderate in the quarters ahead. These represent pro-equilibrating movements, but we are alert to unexpected developments and fresh shocks.
Flexible inflation targeting means in practice that the aim is not to bring inflation back to the target as quickly as possible if it deviates from 2 per cent. But a precondition for being able to be flexible is that there are expectations of inflation still returning to target in the longer run. The inflation target has been the nominal anchor in the Swedish economy for so long that it is easy to assume that inflation expectations automatically stay around 2 per cent. But, as developments after 2011 have shown, long-term inflation expectations are not immune to influence. A long period of sub-target inflation caused expectations to creep further and further below 2 per cent. It therefore became increasingly urgent for the Riksbank to focus on reversing the trend and bringing inflation up to the target. This turned out to require major monetary policy efforts over a long period of time. An insight gained in recent years that therefore needs to be highlighted is that confidence in the inflation target cannot be taken for granted. The main task of monetary policy is to maintain the nominal anchor in the economy and the expectations and demands placed on monetary policy should take this as a starting-point. But on condition that confidence in the anchor is not jeopardised, monetary policy has a certain amount of scope to allow deviation from the inflation target to take a back seat in favour of other considerations.

They exist to manage and reduce the risks faced by their members – to ensure financial contracts are reliably and transparently margined and collateralised. The main prudential risks CCPs face is from the failure and consequently inability of clearing members to meet their obligations to the CCP. The steps that have been taken since the financial crisis to increase the resilience and resolvability of their bank clearing members are therefore a key protection for CCPs. But CCPs also need the backstop of a credible resolution regime. The principal challenge here is not solvency per se but rather the ability of a CCP to restore itself to a matched book if members default, and to do so in a way that does not undermine the stability of the system. CCP rule books provide for very substantial mutualised resources and a comprehensive series of recovery actions. These include, as a last resort, the cancellation or ‘tear up’ of contracts and the end of the clearing service. However, waiting until the mutualised resources of a CCP are exhausted and subjecting participants to the unpredictability of a full tear-up may well pose unacceptable risks to financial stability. Resolution allows the resolution authority to intervene, if necessary, to tear-up a subset of contracts earlier in the process than would be possible in CCP recovery, and before the mutualised resources in the CCP have run out. The losses can then be spread across the membership in the order set out in the rule-book.