samchain/econo-pairs-v1 huggingface dataset:
If inflation deviates from target by more than 1 percentage point, the MPC has to write a public letter to the Chancellor to explain why, and what it is doing to bring it back. These arrangements remain relatively novel and unusual in UK constitutional terms. Prior to 1997, a longstanding objection to Bank of England independence was concern that such arrangements would be inconsistent with Ministerial duty to answer to the House of Commons on major matters of policy. A high level of transparency and openness about MPC decisions has been a critical aspect of meeting expectations of parliamentary and public accountability as well as an effective way of enhancing the credibility of monetary policy. In fact greater openness about monetary policy was part of the package of changes that were made to restore credibility after the UK’s exit from the ERM in 1992. The Bank played its part by introducing a new quarterly Inflation Report, which by 1997 had won widespread respect for its objectivity and  1  Goodhart, C (1999) ‘Recent developments in central banking: some special features of the Monetary Policy Committee and of the European system of central Banks’ Jean Monnet Lecture, Dublin European Institute, 1999. BIS Review 17/2005  1  professionalism. Against this background, the 1998 Bank of England Act required the new Monetary Policy Committee to sign off the Bank’s Inflation Report. In practice, the MPC’s sign off has been far from a formality, though the Inflation Report formally remains the Bank’s report.

The establishment of a national platform for processing card payments - would to provide a direct impact on reducing high costs and improving the current card processing practices, due to the extended cycles and involvement of more actors in the process. Such a platform would also support innovative services, such as mobile payments and e-wallet. The Bank of Albania is analysing the possibility to develop instant payment in our market as well. The implementation of such a project is deemed to have a direct impact on financial inclusion and on providing services at low cost. I invite you to actively participate in  discussions, in order to benefit as much as possible by the experience of other countries, and to analyse the possibilities presented by service providers that are invited to discuss on these topic in the afternoon session. Furthermore, regarding financial inclusion, the strategy pays special attention to the establishment of the concept of “basic” bank accounts with low costs, for the financial inclusion of all levels of population, irrespective of their economic situation. Last but not least, innovation in public services. The initiatives that digitalise and automate public services need coordination and access to various data electronic platforms, such as data of: citizens; addresses; and payments for these services. Any development should be accompanied with financial education of the population, as a precondition for success.
This intensification of concerns has raised the  BIS central bankers’ speeches  1  threat of contagion from these countries, and the consequent financial market developments that have affected several other European countries have added to the risk of a spill-over to the largest European banking systems, including our own. So far, the threat has been limited. An important reason for this is that banks have done the right things over the last two years, namely to focus on their resilience by refinancing debt at longer maturities and raising their buffers of capital. It is hard work in an environment that is still affected by the crisis, but there is no doubting that it is the right thing to have done and continue to do. Sound banking is about having a strong capital base and a funding profile in terms of maturity that can withstand the sorts of shocks in the world that will happen from time to time. It is not about expanding your bank rapidly and funding the growth in the overnight money market. This need for adjustment also explains why at the Bank we are sticking firmly to the plan to allow the Special Liquidity Scheme to run-off on time a year from now. Over the last twelve months, banks have taken the necessary steps to move towards that goal.

A good candidate could for instance be our policy to support fair access to payment instruments: Banque de France is committed to ensure the availability in our jurisdiction of a range of payment instruments suited the needs of all users. The development of electronic payments based on innovative technologies lays the foundation for a smoother and safer payment experience. But this should not exclude part of the population. Up to now, a large part of financial inclusion has also  been about making access to cash easier for those who don’t have a credit or debit card, and ensuring the acceptance and availability of banknotes has therefore been an important dimension of our retail payment policy. But changes in payment solutions supply and changes in payment habits in favour of electronic payments may make this policy more difficult and costly to maintain going forward. One possibility often mentioned would be for the issuance of a central bank digital currency accessible to the general public. At this stage, in many developed economies and certainly in Europe, the business case for this kind of innovation does not appear to me such that it should be a short-term priority. The priority should rather be to facilitate cross-border payments. The case is for me more compelling for a central bank digital currency at the wholesale level, for use between financial intermediaries, given the potential for a quick and widespread tokenization of financial assets.
If true, an obvious follow-up question is whether this should be a concern from a supervisory and regulatory perspective. Today, I will discuss the premise that large banks in the U.S. have indeed become more similar and then consider some reasons why this might be a topic of interest for the official sector. I can think of several compelling microprudential and macroprudential reasons why this would be the case: the need for an appropriate risk management framework that is commensurate with evolving risks; the need for supervisors to ensure that our assessments are 1/5  BIS central bankers' speeches  proactive and flexible enough to evaluate evolving firms; the potential for similar firms to become “systemic as a herd,” where a given shock leads to correlated responses and large-scale disruption in the provision of financial services; and the potential for firms to move away from areas of comparative advantage, which could diminish the overall efficacy of the financial sector. I’ll conclude with some implications for our supervisory regime. Environmental Context The performance of financial firms in the decade since the financial crisis has been influenced by a broad range of external forces. I’ll focus on three factors impacting how financial services are provided and their impact on large firm similarity: the regulatory response to the financial crisis, the interest rate environment, and technological innovation.

To do this, supervisors need to continue to leverage our cross-firm, horizontal perspective to better understand how the industry is evolving and what it might mean for our objectives around safety and soundness of individual firms and the efficient provision of financial services for the economy as whole. 1 I would like to thank Nicola Cetorelli, Bev Hirtle, Michael Holscher, Anna Kovner, Paul Licari, Jackie McCormack,  Siobhan Sanders, Joao Santos, Katherine TilghmanHill, and James Vickery for helpful discussions and analytical work. 2 See Getting It Right: Factors for Tailoring Supervision and Regulation of Large Financial Institutions, Randal K.  Quarles, July 18, 2018. 3 See Lessons from the Financial Crisis, William C. Dudley, November 6, 2017, for reviews from a regulatory  perspective; Early Observations on Improving the Effectiveness of Post-Crisis Regulation, Randal K. Quarles, January 19, 2018. 4  Federal Reserve Board, Consolidated Supervision Framework for Large Financial Institutions, December 17, 2012. 5 The latest CCAR results can be found at www.federalreserve.gov/supervisionreg/ccar.htm.
Having interest rates slightly below zero does not mean the world has been turned on its head, nor does it run contrary to economic logic. Introducing the negative interest rate has on the one hand influenced the financing conditions in the economy. This has been to the benefit of companies, households and the public sector alike. Meanwhile, it also has an effect via the exchange rate, and this is particularly important for us as a small open economy. Charging negative interest reduces the appeal of Swiss franc investments compared with investments in other currencies, and thus plays a significant role in keeping the appreciation pressure on our currency in check. This in turn supports economic activity and is essential for price stability in the current situation. Exchange rates are, of course, also influenced by other factors. However, the comparison between yields on Swiss franc investments and those in other currencies is always an important criterion for investors when deciding which currency to invest in. Knock-on effects of low interest rates That being said, the low level of interest rates does also pose challenges and there are knockon effects. Savers in Switzerland are worried about their savings which are yielding barely any interest. Pension funds and life insurers are facing difficulties in meeting their contractually agreed obligations owing to the low level of capital market interest rates. And banks are concerned about their profitability since they are generating less interest income from their lending business.

A second explanation is the decline in real rates, that is to say nominal rates of interest adjusted for inflation. Chart 2 shows 10-year government bond yields in Switzerland, Germany and the US adjusted for consumer price inflation in those countries. The decline in real interest rates worldwide is attributable to various reasons that have been studied and analysed extensively. In simple terms, we can for example say that the demographic shift has played a key role, with an ageing population tending to save more in light of longer life expectancy. Moreover, the slowdown in productivity growth is curbing the potential return on real investment, thus diminishing the appeal of investments in fixed assets such as factories and equipment. If intentions with regard to saving outstrip investment plans, the real rate of interest has to come down to restore the equilibrium between supply and demand for capital. Monetary policy amid low interest rates What does the lower level of interest rates worldwide mean when it comes to conventional monetary policy? If interest rates are already low, monetary policy is less able to respond to shocks. If the economy and inflation weaken, a central bank will normally stimulate economic activity by lowering interest rates. This mitigates the slowdown and stabilises prices. If interest rates are already low, however, a central bank only has a few moves at its disposal before rates reach zero. And once that happens, conventional monetary policy ends.
The red line in the figure also shows an aggregate measure for the components with the lowest volatility. Their weight in the CPIF is on average 38 per cent during the period. The remaining share is also aggregated and plotted in the same figure (pale blue line). The series of volatile prices oscillates between 4.5 and 10.1 (14.6 percentage points) measured as an annual percentage change, while the index with less volatile prices amounts to between 1.1 and 3.8 per cent during this period of time. 20 This component actually only follows prices in the CPI as a whole. 21 The capital stock index measures the purchase price of the properties (houses and apartments) and improvements such as refurbishments and extensions. 12 [19]  Figure 6. Prices with high and low volatility in the CPIF respectively Annual percentage change. 12 10 8 6 4 2 0 -2 -4 -6  95  00  05  10  15  Prices with high volatility (weight about 17 percent) Prices with low volatility (weight about 38 percent) Other prices  (weight about 45 percent)  Sources: Statistics Sweden and the Riksbank  The average for the index with high volatility is 3.0 per cent, calculated from 1995. 22 The average for CPIF inflation since 1995 is 1.6 per cent. In other words, if one excludes the groups with high volatility one obtains a measure of underlying inflation that has a much lower average than the actual inflation for the period of time concerned.

In the case of the Eurosystem, two examples come to mind: the 2/4  BIS central bankers' speeches  tiering system and TLTROs. The tiering system was introduced after the deposit facility rate was pushed in negative territory, to offset the negative side effects of low-for-long interest rates for banks intermediation. In the case of the TLTROs, we have excluded housing loans from the lending benchmark to avoid contributing to a potential housing bubble. So far, I have mentioned adjustments to our individual instruments; but more generally, our monetary policy tools could be combined with each other so that they maximise their impact on inflation while minimising the side effects on financial stability.4 Indeed this is precisely what the old Tinbergen rule asserts: we now have several instruments in our monetary policy toolkit, allowing us to reach several goals. III. Economic stability Let me now turn to economic stability. The stabilisation of the business cycle is the area of policy trade-offs and dilemmas par excellence. As long as price dynamics are in line with the business cycle, monetary policy is counter-cyclical. Fortunately, this is the case most of the time, as demand shocks tend to prevail. That said, monetary policy is not the only stabilisation policy: fiscal policy is also very active, which raises the very topical issue of the congruence between monetary and fiscal policies. As long as inflation prospects remain too low with respect to the central bank’s inflation objective, accommodative monetary and fiscal policies can be congruent without any formal coordination.
How do we solve the Triffin dilemma and what role will Europe play in the Global Financial Safety Net (GFSN)? A more international euro will provide increased options to store global liquidity, but the goal will obviously not be to turn the euro into a dominant currency. On the contrary, we  Page 6 sur 7 would aim for reliance on multiple currencies to offer stability to the International Financial System through diversification of risks. Regarding the global safety net, the euro area generated a quantum jump for the regional layer of the GFSN in creating the European Stability Mechanism (ESM). In addition, the euro area countries were instrumental for the strengthening of the IMF resources and the SDR allocation and rechannelling. The weight of the euro in the SDR basket should increase in the future in proportion of the increase of its international use. Finally, the Eurosystem is already providing international liquidity through existing swap lines and repo facilities with other central banks, and stands ready to do more if and when warranted. 2. Invoicing international trade With the EU ranking as the world largest trading block, the euro has ample margin to improve as an international trade invoicing currencyvi. The choice of invoice currency is a complex and largely private phenomenonvii, partly driven by the structure of global value chains, which are being reshuffled.

However, if the resolution is carried out by means of a bail-in, there must be arrangements in place in case, when the doors open, some of the funding providers decide to withdraw their funds, because they have been affected by the bail-in, because they believe the bail-in has not been sufficient, or simply because they prefer not to run the risk of waiting to see what happens to the institution. In such cases it is essential to ensure that there are sufficient mechanisms in place to provide the institution with liquidity, to grant credibility both to the resolution tool and the resolution process. In view of how other advanced countries have solved this problem, the solution, in my opinion, could be to involve the central bank as a funding provider, with all due public guarantees provided jointly. However, if any or all of the guarantees were to be enforced, it would be important to ensure the fiscal neutrality of the mechanism in the medium term. Third, insolvency regimes in Europe must be harmonised. If we have common supervision and resolution schemes for banks in Europe, I believe we should also have harmonised arrangements for winding up banks. This would require having a separate insolvency regime for banks, given their idiosyncrasies and the negative externalities that lengthy and inefficient winding up processes may have for other banks, deposit guarantee schemes and the real economy. This should be a common insolvency regime for all the countries of Europe.
His reasoning is that it took a long time for deflation to arise in Japan and that it is therefore important to be aware of the warning signals that arise, such as the fact that the economy grows more slowly than its long-term potential rate for several years in a row. To summarise, it can be observed that the possibility of lasting deflation cannot be ruled out, but that the central banks have good possibilities to prevent this situation arising. The most important thing in this context is that monetary policy is adapted sufficiently quickly to achieve the target level and for monetary policy communication to be reliable and clear. The challenges of globalisation for Sweden Experiences show that it is generally the countries that have accepted globalisation and been quick to adapt both production and policy that benefit most from this process. The major challenge therefore lies in creating dynamic conditions in Sweden to ensure that new jobs arise as old ones disappear. What are the prospects for this? Structural changes in the wake of globalisation mean that less efficient production will be replaced by more efficient production and that sectors that do not hold up in competition will be replaced by sectors where the country has comparative advantages. Structural changes thus consist of two parts: closing down (or outsourcing) and new establishment of businesses. The Austrian economist Joseph Schumpeter called this creative destruction; old jobs and technologies disappear and new, more productive jobs arise as technology develops and production becomes more specialised.

This strategy – which will be explained in more detail at agenda item 3 – is built on three pillars. The first pillar refers to the cyber resilience of individual financial market infrastructures. The second pillar refers to the resilience of the financial sector as a whole. The third pillar highlights the importance of establishing a forum which brings together market actors, competent authorities and the cybersecurity service providers. This brings me to the third and final objective of today’s meeting. Creation of a high-level cyber resilience forum Tackling cyber risk is not for regulators or market actors in isolation. Rather it is a collaborative endeavour that must be undertaken together. Hence, I invite you to seriously consider the creation of a high-level cyber resilience forum for pan-European financial market infrastructures, critical service providers and competent authorities. I am convinced that there is cross-fertilisation and collective learning to be gained from such collaboration and I am looking forward to a fruitful meeting today. 2/2  BIS central bankers' speeches
•  Trade between ASEAN and China is at a record $ billion. •  This large and growing cross border trade will fuel greater RMB trade settlement activity in Singapore over time. The RMB clearing bank will be an important channel for RMB liquidity to circulate between Singapore and China. 4. Singapore’s deep and liquid capital markets will be able to support RMB financing needs in the region. We have already seen companies here issuing RMB-denominated bonds. The Singapore Exchange has announced that it is ready to quote, trade, clear and settle RMB-denominated securities. We can expect the range of RMB-denominated product offerings to expand, as regional corporates raise RMB financing through bond issuances and equity listings, to tap on the strong investor base in the region. 5. There will also be strong and growing demand for RMB trade services. There is a critical mass of international trading companies based in Singapore that will demand such services. With the new RMB clearing arrangements, we can expect financial institutions based in Singapore to reach out to local and regional corporates and investors, and encourage greater participation in the offshore RMB market. 6. MAS is delighted to have ICBC Singapore as our RMB clearing bank. ICBC Singapore has considerable experience in RMB business and is well placed to launch a reliable and efficient RMB clearing service. With the QFB privileges it now enjoys, ICBC is committed to growing its business in Singapore.

Ravi Menon: Financial cooperation between China and Singapore Congratulatory remarks by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the inauguration of ICBC Singapore RMB Clearing Bank, Singapore, 2 April 2013. *  *  *  Mr Jiang Jianqing, ICBC Chairman, Mr Dai Bing, distinguished guests, ladies and gentlemen, good morning. 1. I am happy to join you at this morning’s ceremony inaugurating the Industrial & Commercial Bank of China as the Renminbi clearing bank in Singapore. 2. Today’s event marks a key milestone in the financial cooperation between China and Singapore. It is the fruit of a strong and substantive collaboration between the Monetary Authority of Singapore and the People’s Bank of China. •  MAS extended Qualifying Full Bank (QFB) privileges to ICBC and Bank of China in October 2012 as part of the China-Singapore Free Trade Agreement. •  PBC then named ICBC Singapore as the RMB clearing bank in Singapore. •  Last month, MAS and PBC doubled the size of their bilateral currency swap facility from RMB150 billion to RMB300 billion. The scope of the swap facility was expanded to allow MAS to provide RMB liquidity to banks in Singapore. 3. Singapore is the first regional financial centre outside Greater China to have a RMB clearing bank. Offshore RMB activities in Singapore will be underpinned by the strong and growing trade flows between the region and China. •  Singapore’s bilateral trade with China exceeds $ billion.