samchain/econo-pairs-v1 huggingface dataset:
New statistics on foreign trade indicate that a slowdown can be expected during the second quarter, roughly in line with the assessment made in the April Monetary Policy Update. But it is difficult to compare foreign trade in recent months with the corresponding period last year, as we have had a leap year this year and the Easter holiday came unusually early. This has an effect on the number of business and working days. Employment has continued to increase relatively strongly in recent months and unemployment is still falling slightly. But there are also indications that the labour market will weaken in the future. The number of redundancy notices in April was double that in the same month last year. At the same time, it is still difficult to find the right competence to fill job vacancies in some industries. The demand for labour has declined in recent months, for instance, the number of newly-reported vacancies has declined. This picture is confirmed by the National Institute of Economic Research’s most recent Economic Tendency Survey,  BIS Review 68/2008  5  which indicates a declining need for new recruitment in the business sector. The survey also shows that companies’ views of the Swedish economy have deteriorated. All in all, the confidence indicator for the business sector has moved from being stronger than normal to slightly weaker between April and May. The Consumer Tendency Survey also indicates that consumers have become increasingly pessimistic.

When the oil price reaches record high levels it creates a further incentive to increase the production of biofuels at the cost of food. The IMF observes in its most recent report that biofuels account for only 1.5 per cent of the supply of liquid energy. But the use of these fuels led to demand for crops used in their production doubling between 2006 and 2007. 5 In the slightly longer term the high food prices lead to the supply of food increasing and this dampens prices. But there are also factors that could hold back supply and mean that it does not increase as much as would be necessary to meet the increased world demand. Some supply shocks are of a temporary nature, such as the drought in Australia last year and poor harvests in some regions. One cannot rule out the possibility that climate effects have played a role, and in this case such shocks may be a recurring problem. 6 Another factor that has had a restraining effect on supply and has thereby contributed to boosting the increase in world food prices is the export restrictions introduced by some countries that are major producers of food, in an attempt to protect their domestic consumption from the price increases. The effect on the price of wheat when export restrictions were reduced in the Ukraine is, as I mentioned earlier, a good example of how this can have tangible effect on prices. Another factor that has certainly been significant is the depreciation of the dollar.
Persisting global imbalances notwithstanding, we witnessed a healthier outlook composition of growth besides a more evident rebalancing process. As illustrated in the slide, the current account continued to improve (Chart 3) and the contribution of net exports to growth displayed a surge (Chart 4). I would like to put special emphasis on the contribution of both exports and imports, which proved positive, highlighting the effectiveness of the measures taken. Chart 3. Current Account Balance (12-Month Cumulative, Billion USD)  Chart 4. Contribution of Net Exports to Annual GDP Growth(Percent)  Source: TurkStat, CBRT. Source: TurkStat, CBRT. The year 2012 was not only a year of rebalancing but also a period of important achievements on the price stability front. Inflation trended downwards throughout the year and fell by 4.3 percentage points year-on-year. Moreover, medium-term expectations showed a remarkable improvement for the first time after a protracted period (Charts 5 and 6). Chart 5. Chart 6. Inflation and Uncertainty Band  12- and 24-Month Ahead CPI Expectations* (Annual Percent Change)  Source: TurkStat, CBRT. * CBRT Survey of Expectations. Second survey period results for the pre-2013 period. Source: CBRT. Having started to achieve the intended results regarding inflation and rebalancing, monetary policy has adopted a more accommodative stance since mid-2012. In this respect, the CBRT  2  BIS central bankers’ speeches  lowered its average funding rate gradually since June by increasing the liquidity injected to the market (Chart 7).

Svein Gjedrem: A central banker’s comparison of the Nordic countries Introduction by Mr Svein Gjedrem, Governor of Norges Bank (Central Bank of Norway), at the panel discussion of the ACI Nordic Congress, Göteborg, 24 August 2002. Please note that the text below may differ slightly from the actual presentation. *  *  *  For outsiders, it may be convenient to see the Nordic region as consisting of countries with very similar characteristics. However, the countries are different in several ways. First, they differ in their relations to the EU and with respect to their monetary policy regimes. Sweden, Denmark and Finland are members of the EU. Finland is also a member of EMU. The euro has replaced the markka as legal tender, and Finland and the other 11 member countries of EMU have a common monetary policy. Denmark is in ERM II while Sweden, Iceland and Norway have inflation targets. In Norway the inflation target of 2½ per cent was adopted on 29 March 2001 and now functions as the nominal anchor for the Norwegian economy. The introduction of the inflation target did not imply a significant shift in the way monetary policy was conducted. However, the introduction of the inflation target brought monetary policy in Norway more in line with common practice internationally, and facilitated communication. Although the approaches differ, inflation has been relatively low and stable in the Nordic countries in recent years. Second, the Nordic countries are different in terms of industrial structure.
The degree of Central Bank intervention in the foreign exchange market varied over time with balance of payments developments and the view of the Central Bank on the direction of the exchange rate. Under this monetary targeting framework with a crawling exchange rate, achieving price stability proved challenging, as successive governments continued to run high fiscal deficits even after the completion of the accelerated Mahaweli scheme to finance large scale housing and road development programmes. In addition, the three decades of ethnic conflict required successive governments to spend more money on defense expenditure. In order to maintain competitiveness of the rupee, the Central Bank had to let the currency depreciate to, at least partly, compensate for the inflation differential between Sri Lanka and its trading partners under the crawling peg system. Even though this arrangement helped to alleviate the adverse impact on exports to some extent, higher domestic demand created through excessive fiscal deficits led to large current account deficits in the balance of 10  payments, making it difficult to maintain the crawling peg without a sharp depreciation. By the year 2000, Sri Lanka experienced a significant decline in its official international reserves, as a result of the considerable increase in expenditure on imports. The increased demand for foreign exchange placed tremendous pressure on the exchange rate. Within the managed floating exchange rate regime, this naturally resulted in increased pressure on international reserves.

A fundamental precondition for exchange rate stability against the euro is that the inflation rate in Norway is brought down to the level aimed at by the Eurosystem. In recent years, the rate of increase in prices has been higher in Norway than among euro area countries, which is reflected in the interest rate differential between Norway and the euro area. If we were to lower interest rates to the level prevailing in the euro area in the current environment, inflation would rise rapidly in Norway accompanied by exchange rate volatility. Any movements in the krone exchange rate will be thoroughly analysed by Norges Bank. A policy response pattern involving automatic changes in interest rates in response to movements in the exchange rate, as a fixed exchange rate regime would imply, is inappropriate. A century of growth Chart 11  At the turn of the last century GDP per capita was around NOK 20,000 in present-day value. Today the average is around NOK 250,000, or about 10 times higher than 100 years ago. For purposes of comparison, the increase was barely twofold between 1820 and 1900. Economic growth in Norway was particularly strong in the first 30 years following the Second World War, as a result of the introduction of new technology from the US and new products in Europe. Europe has gradually caught up with the US thanks to the import of technology from the US, effective restructuring and the expansion in global trade.
The current account deficit decreased at 6.7% of the GDP in 2018, from 7.5% in the previous year. Its improvement reflected to a large extent the increase in the tourism-related activity. Budget deficit and public debt continued to record a downward trend, reflecting both the consolidation path of the fiscal policy and the economic growth as well as the exchange rate appreciation. The main banking sector soundness indicators, in particular liquidity, profitability and capitalisation, remain at satisfactory levels. Against this backdrop, annual inflation averaged 2.0%, remaining unchanged from 2017 and below our 3% target. Inflation stood stable owing to two effects of opposite directions. The buildup in domestic inflationary pressures, generated by the rise in employment, wages and production costs was offset by the rapid appreciation of the domestic currency over the first half of the year. The exchange rate appreciation was a decelerating factor for achieving the inflation target. The exchange rate has moved along a slight appreciation path over the last three years, driven by fundamental factors that dictate its behaviour such as: improvement of the balance of trade exchanges with abroad, high levels of foreign direct investments, and reduction of risk premia in domestic financial markets. Yet, beyond these effects, the exchange rate was subject to certain shocks in the first half of 2018.

The purpose of the strategy is to improve the retail payments market, promoting the use of electronic payment instruments and broadening the financial inclusion of the population. The strategy will be implemented through the improvement of the legal and the regulatory frameworks, through improvements in infrastructure and financial education. Other activities In the field of statistics, the Bank of Albania continued its work for the methodological approximation of statistics with international standards and their alignment with the acquis communautaire. In cooperation with INSTAT and with expertise from the European Union, the Bank of Albania coordinated the work to develop indicators of macroeconomic imbalances for Albania. During 2018, the EUROSTAT carried out an evaluation mission of the Statistical System in Albania, which assessed that the statistics of the Bank of Albania are in line with the principles of the European statistics Code of Practice. As at the end of 2018, the international reserve reached EUR 3.4 billion, sufficient to cover 6.7 months of imports of goods and services and 156% of the short-term external debt. In order to 6/8  BIS central bankers' speeches  increase the flexibility of managing the needs for foreign currency liquidity, an agreement was finalised with the Bank for International Settlements for a foreign currency credit line. The agreement constitutes an important mechanism available to the Bank of Albania in the event of an emergency situation. Research continued to support the decision-making process for formulating and implementing Bank of Albania’s policies.
If market discipline is to be effective, however, it must be supported by substantial and meaningful public disclosure - as well as sound accounting standards and an efficient and credible legal framework. Knowing a company's appetite for risk and its approach to, and methodologies for, managing risk is essential to understanding the risks of being a shareholder, a creditor, or a counterparty. While significant progress has been made in recent years in improving disclosure practices, it unfortunately remains the case that many of these practices have simply not kept pace either with the rapid changes in many firms' business activities and risk exposures or with how these exposures are measured and managed. For this situation to be fully remedied, notions of what is proprietary information and what should be in the public domain must change. There can be no doubt about the need for dramatic progress in improving disclosure practices. Clearly, a full appreciation of risk cannot be achieved without sufficient information. This past year has made all too clear that there is no greater enemy to financial stability than a loss of confidence - and nothing undermines confidence more than a lack of reliable information. Discipline imposed by markets might not be pleasant, but fuller, higher-quality information - in a word, transparency - bolsters the confidence of depositors and other creditors and thereby makes doing business easier and more secure for everyone.

The decisions taken on 12 March, which were said to have missed their target, have often been compared unfavourably with the successful “package” of 18 March. However, I want to stress that they are complementary. On 12 March, the ECB decided to make almost EUR 3,000 billion – ¼ of euro area GDP – available to banks through “TLTRO III” operations that provide refinancing at a negative interest rate (that can be as low -0.75% if banks at least maintain their stock of outstanding loans) for an amount of up to 50% of lending to the economy, essentially to ISEs and SMEs. On 18 March, we further decided to launch an exceptional asset purchase envelope of EUR 750 billion for those that obtain their financing through the markets, namely governments and large corporations. This totally unprecedented Pandemic Emergency Purchase Programme (PEPP) aims at avoiding a positive shock on long-term interest rates associated with the exceptional expense of the public health crisis. It also comes on top of the EUR 300 billion of asset purchases that had already been planned. Also unprecedented is that the ECB has thus accorded itself flexibility, where necessary, on three fronts: between public and private sector  Page 4 of 8 securities, between countries for public sector securities, and with regard to the issuer holdings limit of 33% on each public sector security. The Eurosystem also decided, quickly and forcefully, to activate its macro- and microprudential levers to help euro area financial institutions optimise their capacities to finance businesses.
Citizens in service, not people in power Speech given by Alex Brazier, Executive Director for Financial Stability Strategy and Risk, Bank of England Member of the Financial Policy Committee  At Allen & Overy, London Friday 17 May 2019  I am grateful to Hugh Burns, James Howat, Kiman Bassi, Jonathan Bridges, Emma Moriarty, Emily Clayton, James Hurley, Guy Debelle, Ben Broadbent, Martin Taylor, Alina Barnett, Dimitri Demekas and Paul Tucker for helpful discussions. The phrase ‘citizens in service’ is also used by Tucker in his book ‘Unelected Power’ (2018, page 546). All views, errors and omissions are my own. 1  All speeches are available online at www.bankofengland.co.uk/speeches  I’d like to express my thanks to Allen & Overy for hosting this event and for bringing together such a formidable crowd to discuss these issues. More than a decade on from the financial crisis, memories can begin to fade. They must not. Because the crisis was a disaster: leaving a legacy economic cost equivalent to about £ per person.1  Like all disasters, it should be memorialised so that future generations are not destined to repeat the past. It’s sometimes argued that the crisis happened because nobody spotted that the system was heading for the rocks. I think the causes run deeper than that. They centre on a collective failure to take the long view. The financial system lived for the moment.

In particular, due to the growing presence of new participants in credit markets with greater risk tolerances, it seems that firms with lower creditworthiness (credit ratings) may have found it easier to refinance and restructure their debt. This refinancing activity has included the greater use of weaker loan covenants than in the past. Thus, to a certain extent, firms may only be deferring their financial difficulties into the future. When the credit cycle finally turns, the consequences could be more abrupt and severe than past experience might suggest. In this context, the recent episode of re-appraisal of credit risk pricing in the US sub-prime mortgage market may provide some guidance on how the credit market could behave in a broader downturn. Since mid-2005, the combined effect of resets of initial borrowing terms to higher interest rates and reduced abilities of borrowers to avoid such resets through house sales or to carry out cash-out refinancing, has been associated with rising delinquency rates on securitised sub-prime mortgage loans. The impact of sub-prime mortgage delinquencies on the lower-quality-end of the credit risk transfer (CRT) market has been substantial. Early this year, the concern of market participants about deteriorating sub-prime credit quality led to a significant and, so far, persistent increase in the cost of credit protection associated with sub-prime non-agency residential mortgage-backed securities (RMBS), as shown in the chart on the right of slide 5. Box 2 of the Review contains a more detailed assessment of the potential risks of the sub-prime episode.
It may also be difficult for a supervisory authority to build up and maintain a level of macroeconomic expertise sufficient to make a difference in financial crises that only occur every ten or twenty years. But such expertise always has to exist at the Riksbank. Fourthly, there is the matter of resources. For many years, Finansinspektionen has had too few resources to carry out its tasks. This has been pointed out by the IMF most recently. A merger would probably mean that more resources would be allocated for Finansinspektionen’s tasks. Merging the authorities would also allow us to avoid duplicating work and to achieve synergies such as a joint macroeconomic analysis and shared support functions and databases. It should also be noted that increased resources for this activity would not have to burden the taxpayers, as the financial sector would fund the activity via charges. The role played by the state in financial stability is currently being strengthened in several areas of the world. In the United States, which frequently has a large number of authorities acting within one area, a council with overall responsibility for financial stability has been set up. In the United Kingdom, responsibility has been assumed by the Bank of England. The new EU authority, the ESRB, has been moved to the ECB. It has its own board and its own secretariat, but it will also have the ECB’s resources at its disposal.

These topics are of particular importance in the current context in which our economies are undergoing significant changes in the credit market as well as in the behavior of consumers and borrowers. Therefore, it is essential to upgrade financial infrastructures, which constitute a central element in the credit risk management system, in order to accompany these changes and help us to meet the challenges we face. Before concluding, I would like to emphasize the invaluable opportunities that the new information technologies can offer us in terms of data sharing, collection and storage. But they also involve major challenges, particularly in terms of cyber security and personal data protection. I wish you a successful and fruitful meeting, and hope that you can combine business with pleasure and allow yourself some time to discover the millennial richness of Rabat, this imperial city which was listed by UNESCO as a World Heritage Site on June 29, 2012. Thank you for your attention. 3
Despite very high demand for Swiss francs, the percentage fell from 21% to 15% between 2008 and 2014; since negative interest was introduced, it has fallen further and now stands at only about 11% (cf. chart 7). Conversely, the share of domestic investors has risen. This group often favours domestic bonds for their long-term investments, or is obliged to hold a given percentage of such bonds for regulatory reasons. Nonetheless, demand from foreign investors remains strong in some segments of the Swiss franc bond market, notably that for money market debt register claims. How do we explain this apparent paradox? One contributory factor is the distortions on the FX swap market mentioned before. While they make borrowing more expensive for foreign issuers, they have the opposite effect for foreign investors and offer special arbitrage opportunities. This allows investors from the US dollar or euro areas to achieve higher returns on a hedged basis. 5 The weekly auctions have been clearly oversubscribed, as can be seen from chart 8. Although the average yield to maturity is very low, bids have been significantly higher than actual allocation (blue), with some 60% of outstanding money market debt register claims currently in the hands of foreign investors. All in all, we can say that, despite strong demand for Swiss francs and low interest rates in Switzerland, the outstanding volume of the Swiss franc bond market has barely changed.

Indeed, in terms of financial stability, the development is welcome news as any additional stimulation would only have aggravated imbalances on the mortgage and real estate markets. The third notable aspect relates to developments in the public sector, where the volume of outstanding bonds has fallen over the last ten years. Although the volume issued by the cantons and municipalities increased, that issued by the Confederation declined markedly. While public debt levels rose substantially around the world in the wake of the financial crisis, the Confederation has managed to reduce its debts over this period, thanks to regular budget surpluses. In the context of the Swiss franc bond market as a whole, however, the decline in the volume of outstanding Confederation bonds is comparatively inconsequential. So, in contrast to the domestic segment, which has grown overall, the foreign segment began contracting as far back as 2011. This is principally due to the fact that the financing needs of European banks have tapered off significantly since the financial and debt crisis. In the foreign segment banks are by far the most important issuers of bonds, as can be seen in chart 5; this applies particularly to European banks, which account for 70% of all issues. And in recent years, foreign banks have gradually withdrawn from the Swiss franc capital market. Another possible factor behind the contraction in the foreign segment could be FX swap market distortions.