samchain/econo-pairs-v1 huggingface dataset:
BIS Review 42/2003  1  The salient features of the economic outlook World economic activity has been broadly in line with our forecast in the June Inflation Report. If anything, current tendencies are somewhat better, as concluded by the Executive Board at its monetary policy meeting in August. Signs of a recovery in the US economy have become increasingly evident, which is pleasing of course. The outlook is different, however, for the euro area. Perhaps there is reason to expect a slightly longer delay in the European revival, even if we have recently seen a number of positive signals of a forward-looking nature. On the other hand, it appears that economic activity in Japan will be stronger than expected. On balance, it currently seems likely that international activity will be roughly in line with the forecasts we made in August. For Sweden, the majority of indicators point to an upturn in economic activity in the autumn. In accordance with our forecast during the summer, there are currently some unutilised resources (see Chart 2). This has mainly been due to a weakening in demand over the past two years. In addition to the relatively favourable capacity level, productivity growth has also been unexpectedly fast given the current economic climate. In the near future, demand is expected to mount due to both solid consumption growth and a small rise in investment.

However while such measures have removed near-term uncertainty, they could prove insufficient to provide a lasting change in the negative sentiment of investors on the mediumterm if budget deficits and debt situation are not considerably improved. In this context, European authorities have to show their strong level of cooperation and commitments to global and common solutions. Any unilateral and uncoordinated decision may notably prove to be less efficient and may amplify markets volatility. Finally, the removal of vulnerabilities in the banking sector is desirable to alleviate uncertainties. Effective risk management, transparency and robust business models are essential to strengthen banks’ resilience to shocks and to ensure adequate funding of real economy that underpins sustainable growth and financial stability. The effective and timely implementation of the G20 policy orientations is necessary to build the new international system on a solid and stable ground. This is notably the case for the G 20 provisions on the CDS market and on credit rating agencies. One cannot deny that certain OTC derivatives (CDS for instance) or certain types of transactions (short sales) are likely to exacerbate price movements or create instability that are detrimental to both issuers and investors. One may thus find it tempting to ban or drastically limit this type of operations and we indeed have observed national proposals going in that direction, including the bank of naked CDS, naked short sales or mandatory shorter time horizon for settling transactions. I am of the view that such measures may not be efficient and, worse, may be counterproductive.
This assessment will be informed primarily by our staff macroeconomic projections, on which all data are incorporated in a coherent manner. In this regard, the staff March forecast pointed to a weakening of activity in 2023, with real euro area GDP expected to grow by 1% in 2023 (compared with 3.6% in 2022). This scenario is somewhat more optimistic than that of the previous projections (published in December), reflecting better than expected recent economic data and the fall in the cost of energy, so that real income losses are lower. Growth is expected to pick up, to 1.6%, 1  See “An overview of the ECB’s monetary policy strategy”. 1  in both 2024 and 2025, based on a robust labour market, improving confidence and the recovery of purchasing power. However, these growth rates are lower than projected in December owing to a stronger tightening of financial conditions, including a larger appreciation of the euro exchange rate. And, in any case, the accumulated growth path expected now for 2022-2024 is significantly lower – around 2.5% lower – than that projected in December 2021, before the war in Ukraine, reflecting the material deterioration of euro area terms of trade. On inflation, the baseline scenario is one of gradual convergence of inflation to our 2% target. After peaking at 10.6% in October last year, HICP declined to 6.9% in March this year, according to the flash estimate, on the back of lower energy prices and base effects.

However, that rate is now heading upwards, rising from around 1.5% in mid-2022 to 3.6%12 in February this year. At some point, however, the fall in energy prices, the improvement in supply chains and the moderating demand, owing to tighter financial conditions should begin to gradually produce reverse effects on inflation. Thus, at the current juncture, we could well be nearing some sort of crossroads, where the lagged effects of the past increases in commodity prices and exchange rate depreciation are still present, but diminishing, while the first effects of the most recent decreases and appreciation may be emerging and on the rise. However, when this crossroads is reached, and how strongly it will support a decline in inflation, will depend on the extent of the symmetry between the impact of higher and lower costs on prices. In this regard, the impact of cost decreases on inflation may not be fully symmetrical to the impact of cost  10  These items were more directly affected by the increase in the cost of energy, food prices or supply bottlenecks, together with the strong demand for specific goods during the pandemic (especially in the case of durable goods) and the reopening phase (notably in the case of services). 11  A breakdown of core inflation by destination of expenditure shows that the components related to transport recorded an annual price increase at 7,1% in February, 7,3% in December. Prices in the housing equipment and maintenance sub-index increased 9% February, down from 9,3% in December.
That is, as I quote in my speech, the cause of the double-dip that we had in 2012, 2013, which should not have happened. And was the result of fiscal policy, not monetary policy. So why are you so optimistic that next time it will be better, that fiscal policy can step into the breach during the next downturn? In the first place, I don’t anticipate that we will have the sort of imbalances that we had at that time. Everyone has learned lessons and it’s very unlikely that Member States’ economies will become as imbalanced again. The adjustment that the more stressed countries went through shows that those Members States are now able to work effectively in the framework of the Monetary Union. Both in terms of the fiscal rules and in terms of the sort of level of structural change that we have seen in the past few years. Do you think it was a mistake for the ECB to become involved in the Troika? It was in a way unavoidable in view of the acuteness of the crisis we had, and good that it happened. Everyone wanted us to be there and we could not of course refuse what was then the expectation of everyone that we would help out with our expertise. To what degree do you think austerity and the crisis have influenced the current political mood? I think it plays a big role.

I was just reading a paper written by three German economists on extreme politics, in a very good economic journal, about the political consequences of big recessions in 20 countries from 1870 to the present day.2 And indeed they show a correlation between extreme severe downturns and the political polarisation. Only in the case of financial crises during the ensuing five years, far-right parties increased on average their voting share by 30%. Far-left parties never benefited much from financial crises. And so I’m not saying that the increase in populism, liberal democracy is some authoritarian drive, it’s only the result of the economic crisis; there are other factors, but it’s certainly a big one. Let’s talk more about the crisis. Can you remember the first moment when you became concerned? I became concerned at the beginning of 2010, when, back in February, the budget deficits of several countries for 2009 were known and were higher than anyone expected. Particularly, of course in Greece, which recorded a deficit of 15% instead of an expected 5.6%, but also other countries. We started to feel the pressure in the bond market after that, so those were the first signs of something really becoming serious. Then it intensified. We had a meeting of the Governing Council in Lisbon on 5 May, just a few weeks before I came here to the ECB. That was the day of the flash crash in Wall Street, with 4/8  BIS central bankers' speeches  huge repercussions in bond markets everywhere.
Inside the nudge unit: How small changes can make a big difference. Random House. Hanson, S. G., Kashyap, A. K., & Stein, J. C. (2011). A macroprudential approach to financial regulation. The Journal of Economic Perspectives, 25(1), 3-28. Harris, Q., Mercieca, A., Soane, E. & Tanaka, M. (forthcoming). How do bonus cap and clawback affect risk and effort choice? Insight from a lab experiment. Bank of England Staff Working Paper. He, D. (2013). Hong Kong’s approach to financial stability. International Journal of Central Banking, 9(1), 299-313. Herring, R. (1998). Banking Disasters: Causes and Preventative Measures, Lessons Derived from the U.S. Experience. In Preventing Bank Crises – Lessons from Recent Global Bank Failures, edited by G. Jr. Caprio, W. C. Hunter, G. G. Kaufman, and D. M. Leipziger, Proceedings of a conference cosponsored by the Federal Reserve Bank of Chicago and the Economic Development Institute of the World Bank, The World Bank, Washington D.C., September, pp. 209-236. Heil, M. (2017). Finance and Productivity: A Literature Review. OECD Economics Department Working Paper No. 1374. Hoggarth, G., Reis, R., & Saporta, V. (2001). Costs of banking system instability: some empirical evidence. Bank of England working paper. Homar, T., & van Wijnbergen, S. J. (2016). Bank recapitalization and economic recovery after financial crises. Journal of Financial Intermediation. Huang, R. & Ratnovski, L. (2009). Why Are Canadian Banks More Resilient? IMF Working Paper No. 09/152 IMF (2014). Global Financial Stability Report. Risk Taking, Liquidity, and Shadow Banking: Curbing Excess While Promoting Growth. October 2014. Independent Commission on Banking (2011).

Ardo Hansson: Working together for the good of the EU and Estonia Opening speech by Mr Ardo Hansson, Governor of the Bank of Estonia (Eesti Pank), to the Ragnar Nurkse Lecture for the 95th Anniversary of Eesti Pank, Tallinn, 4 November 2014. *  *  *  Professor Balcerowicz, President of the Riigikogu, Chair of the Supervisory Board of Eesti Pank, Excellencies, Ladies and Gentlemen, Thank you for being here today to mark the 95th anniversary of Eesti Pank and to honour Ragnar Nurkse, the world's best-known economist from Estonia to date. Eesti Pank was founded when the Republic of Estonia was only a year old and Ragnar Nurkse was a model eleven-year-old pupil at the Tallinn Cathedral School. In the words of Juhan Kukk, the Minister of Finance of the time, founding Eesti Pank as the issuer of the national currency and tying the currency to gold showed the same great “bravery and belief in national and economic independence” as engaging in the War of Independence did. Ragnar Nurkse started his studies in the University of Tartu, but he soon moved to continue them in the School of Economics of the University of Edinburgh and later in Vienna. He was recognised in his home country for his work, as is shown by the worried letter that Jüri Jaakson, Governor of Eesti Pank at the time, sent him in spring 1938. Nurkse was working in Geneva at the time for the League of Nations, the forerunner of the United Nations.
Let me end these remarks by underlying some of these remaining challenges on the economic front. The monetary union is one of the milestones of the European project: a single currency, the euro; and a single monetary policy, with its own institution, the European Central Bank. This is the epitome of cooperation among countries: a supranational agency that takes into account the well-being of the whole area instead of nations exercising their powers in a disorderly fashion. As a reward, the contribution of monetary policy to the economic stability of the union has been decisive, particularly during the sovereign debt crisis and, crucially, in the current health crisis. In addition to monetary policy, during this crisis, there has also been a genuine, common fiscal European response to the pandemic, notably including the creation of the Next Generation EU (NGEU) recovery fund. This fund adds key elements to ensure the burden of the economic recovery effort is shared. Some are unprecedented, such as the large-scale issue of supranational European public debt to finance reforms and investment in those Member States most affected by the pandemic. However, NGEU cannot and should not be seen as the cyclical stabilisation mechanism the euro area needs to complement our single monetary policy. A true macroeconomic stabilisation mechanism should be a multilateral institution in itself, of a permanent nature and with sufficient size, taxation power and borrowing ability.

As such, the global recovery will be based on trust and solidarity between nations. Is such cooperation possible? Europe is a case in point. Let´s take again the example of vaccines. When the prospect of a common vaccination pool and 2/4  BIS central bankers' speeches  the purchase of vaccines on an uncoordinated basis was aired, European institutions took the decision to cooperate. That has allowed vaccines to be provided at the same time for countries with very different production or vaccine-purchase capabilities. It is an example of cooperation worth exporting to global vaccination programmes. Another example is the case of the policies needed to tackle climate change. The European Union has pioneered a system of cross-country carbon emission rights. This mechanism, according to recent studies, has led to a reduction of more than 10% in the emissions of regulated companies.3This coordinated effort has seen the EU commit to a binding target of a net domestic reduction of at least 55% in greenhouse gas emissions by 2030 compared to 1990. It far exceeds the commitment to cut emissions by at least 40% under the Paris Agreement. Again let us view the European Union as a laboratory for what the multilateral effort can – ideally – achieve. European economic institutions: unfinished work However, in order for Europe to play this role properly, Europe should deepen its own integration project. Only by addressing the remaining challenges of our political and economic integration process, we – European – can aim to contribute decisively to global objectives.
And it will continue like this in the years to come, encompassing several areas related to macro-prudential regulation, financial markets infrastructures and payment systems. While some developments need legal changes, it is in the interest of the Central Bank to keep working on promoting greater and safer financial integration and more secure short8  term funds availability, improving both financial infrastructure and large value and retail payments, and exploring new macro-prudential tools. (i)  A greater and safer financial integration of our financial system  In general terms, financial integration can contribute to economic development through a reduction of financial costs for investment, increased competitiveness, the development of capital markets and portfolio diversification. The recent FSAP acknowledges that the Chilean financial market is well integrated into the global financial system: Chilean firms invest in foreign financial assets, and foreigners participate in the local market. However, it is still possible to advance in two main dimensions: a) Promoting the use of the Chilean Peso in cross-border transactions, and b) Increasing robustness of the processes of trading, clearing and settlement of foreign exchange transactions in the local and foreign market. a) Promoting the use of the Chilean Peso in cross-border transactions The internationalization of the Chilean peso can enhance financial stability, by alleviating liquidity concerns during stress episodes and reducing counterparty risks, among other effects, which are quite relevant in the current scenario.

In this regard, I wish to make special mention of the Stock Exchange Technical Committee (SETC) First Initiative, the Commonwealth Secretariat, the West African Institute for Financial and Economic Management, the Team of local Lawyers headed by Mr Eke Halloway, as well as market practitioners in neighbouring countries who have been unrelenting in sharing their experiences and expertise with us. Naming people in these situations can be invidious, but let me crave your indulgence to mention Mr Maroof Matin, the Resident Consultant provided by First Initiative, Mr Jacob Kanu of First Discount House, Mr Melvin Tucker, former Deputy Governor and other members of the Stock Exchange Technical Committee. To all of these, I say thank you very much and please let us continue to work together for a more prosperous Sierra Leone. Thank you for your attention. 2  BIS Review 107/2007
There is therefore a strong need for China’s banks to gear up and gird themselves for the challenges that will be posed by their sophisticated foreign competitors. For foreign banks, the opportunities brought by financial liberalisation on the mainland, in the context of WTO, are immense. In two years’ time, foreign banks will be able to conduct RMB business with Chinese enterprises in Shanghai, Shenzhen, Tianjin and Dalian. Within five years, they will be able to deal with all Chinese enterprises without any geographical restriction. The obvious advantages for Hong Kong’s banks in this process are the same advantages that have taken Hong Kong’s other industries into the mainland. Hong Kong’s banks were among the first to open branches on the mainland, especially in the southern cities: they know China well, speak the language, have extensive branch networks, and maintain strong relationships, some of which have grown up over more than a generation. There are niches in which Hong Kong’s banks should maintain and extend their competitive advantage. For example, they should be able to continue to derive substantial business from the extensive involvement of Hong Kong companies in the manufacturing and retail sectors in China, in the form of private or joint venture enterprises. Given also that about 40% of the mainland’s trade is routed through Hong Kong, Hong Kong’s banks will have an unrivalled advantage over other banks in capturing the increased demand for trade and related financing services.

Rodrigo Vergara: Chile’s latest Monetary Policy Report Presentation by Mr Rodrigo Vergara, Governor of the Central Bank of Chile, of the Monetary Policy Report before the Honorable Senate of the Republic, Santiago de Chile, 4 September 2013. *  *  *  The Monetary Policy Report of September 2013 can be found at http://www.bcentral.cl. Accompanying figures and tables can be found at the end of the speech. Mister President of the Senate, Senator Jorge Pizarro, honorable senators, ladies, gentlemen, Thank you for inviting the Board of the Central Bank of Chile to present our Monetary Policy Report. Each September, this presentation coincides with the annual report of the Central Bank to the Senate, where we share our vision on the recent macroeconomic and financial developments in Chile and the world, together with the economic-financial outlook and its implications on monetary policy. When I presented our Monetary Policy Report to the Senate’s Finance Committee in early July, I said that the world economy had begun to move towards a more normal configuration, with a more balanced growth outlook between developed and emerging countries, and where the terms of trade and financial conditions would not be as favorable to Chile as they had been for some years.
There are many indications that international economic activity will continue to strengthen in the period ahead and that resource utilisation will gradually pick up. High productivity growth and weak resource utilisation have kept down cost developments in a number of industrialised countries. Coupled with the increased integration of low-cost countries into world trade this has contributed to low global inflationary pressures. In the period ahead, price pressures are expected to remain modest even though they will increase as economic conditions improve and there is a reduction in spare production capacity. That means that market interest rates are also anticipated to rise from today’s unusually low levels. There are positive signals emanating from the US economy while the euro area, and notably Germany, has seen somewhat weaker growth than expected. (Figure 6.) Overall, growth in Sweden’s export markets is forecast to be largely the same as in the previous Inflation Report. The Swedish economic recovery began in 2003 and it is predicted to continue during the forecast period. In 2004 robust international demand for Swedish exports contributed to the high economic growth. Manufacturing activity now appears to be entering a slightly slower phase. Indicators and data point to a continuation of firm, healthy growth, albeit at a somewhat lower rate than in early 2004. Growth in domestic demand is assumed to increase while the contribution to aggregate demand from net exports will diminish. (Table 1). In 2005 business investment and private consumption are anticipated to account for the majority of the pick-up in demand.

Compared with the December Inflation Report the forecast for GDP growth in 2005 has been revised up marginally to 3.2 per cent, mainly due to higher investment and increased services trade. Towards the end of last year investment in the economy grew more than expected and there is much to suggest that the fast increase will continue in early 2005. Despite last year’s robust productivity growth the number of employed fell for the second consecutive year. The fact that firms were able to boost output so sharply without hiring new staff was due to a rise in both productivity and average working time. It is reasonable to believe, though, that a continuation of strong GDP growth will result in higher employment during the forecast period. Different indicators from the labour market also suggest that a turnaround is on the way. For example, the number of temporary employees has risen since summer 2004 and the number of new job vacancies reported to Swedish employment offices rose in annual terms in the period November-January after having dropped for almost two years in a row. There is reason to expect average productivity growth in the economy to decrease somewhat as the economic upswing continues. Nevertheless, the Riksbank’s assessment remains that there has been a lasting increase in the rate of productivity growth, and the Bank’s forecasts for the coming years are therefore relatively high in a longer historical perspective.