samchain/econo-pairs-v1 huggingface dataset:
A central bank can appropriately be assigned the task of promoting sustainable economic growth, while maintaining long-term price stability and ensuring the health of the financial system. This way of articulating policy goals has the advantage of meeting the public’s need to understand the basis for monetary policy decisions, and may help, therefore, to enhance the democratic accountability of monetary policy. Once monetary policy is firmly committed to price stability, how can a central bank best reach that goal? Clearly, at an operational level, no single formula or implementation strategy can be expected to succeed in all countries and under all circumstances; possible approaches can take many different forms. The choices depend on a country’s history, economic conditions, traditions and institutions. But all successful approaches share two important features: first, they focus on a long-term time horizon and, second, they provide a clear and public standard for the assessment of policy. What is most significant is not the specific way a central bank chooses to seek price stability, but rather the underlying commitment to that goal. While monetary policy aimed at long-run price stability is critical to fostering sustainable economic growth, central banks’ role in promoting growth and, more generally, a healthy economy goes beyond the conduct of monetary policy. Through involvement in financial regulation and supervision, as well as in the oversight of payments system operations, central banks play a key role in preserving and enhancing the safety and soundness of the banking and financial system.

Because of the importance and the difficulties inherent in the balancing act, banking systems are generally subject to a higher degree of official oversight and regulation than are most other forms of private enterprise, and supported by some form of a broad safety net. While the specifics can differ appreciably across countries, these safety nets are usually constructed along similar lines. They generally include oversight of the affairs of banking institutions in the form of inspection and examination of the institutions for compliance with a broad set of safety and soundness standards; some type of protection against losses for BIS Review 17/1997  -5-  small depositors and investors; and some form of emergency liquidity facility for banking institutions and, occasionally, for other financial institutions as well. Finally, the payments system, a crucial link in any financial system, generally includes some form of official regulation of or participation in its operations. These important aspects of the safety net often feed into one or more of the functions performed by central banks. For this reason, the central bank usually plays a major role in the operation of one or more of these facets of the safety net. For example, the emergency liquidity facility is almost always the discount window of the central bank. In many countries -including Ireland and the United States -- the central bank also plays an important role in the supervision of banking institutions and in the oversight of payments system operations.
There is no such a thing as a “Fed put.” What we care about is the country’s growth and inflation prospects, and we take financial market developments into consideration only to the extent that they affect the economic outlook. Our focus on the global implications of our policies also has a broader dimension. Given the central place of U.S. markets in the global financial system and the dollar’s status as the leading global reserve currency, we in the United States have a special responsibility to be good stewards of the global economic commons. This makes it all the more important that we conduct policy transparently and according to clear principles. This highlights the importance of effective Fed communication. I noted earlier our attempts in the spring of 2013 to provide guidance about the potential timing and pace of tapering may have served to confuse market participants. Market participants seemed to conflate the prospective tapering of asset purchases with monetary policy tightening, and pulled forward their expectations about the likely timing of liftoff, thus raising their expected path for the federal funds rate. Since then, we have adjusted our approach with improved results. The actual tapering of the Fed’s asset purchase program went smoothly and liftoff of our policy rate from the zero lower bound was in line with widely held market expectations.

Under certain circumstances stock adjustments may trigger a more marked economic slowdown. This may happen, for instance, if effects of the adjustments either spread to private consumption or have a negative impact on the labour market and household confidence. The Riksbank was therefore alert to the risk of private consumption being weaker last spring and summer, which would have pointed to a further curb on inflation. In practice, however, private consumption went on rising in the summer and its growth became somewhat stronger in the autumn. Low inflation and interest rate reductions The rate of inflation decreased during 1996 and the rates that different economic agents expected in the future also moved down markedly (Diagram 2). This enabled the Riksbank to lower the repo rate from 8.91 to 4.10 per cent. As a result, the initial position for the ongoing growth phase in Sweden’s economy is more favourable than for many years. The drop in the rate of consumer price increases was appreciably accentuated by the Riksbank’s repo rate cuts in that these contributed to the reduction of mortgage interest costs. Under normal circumstances the tolerance interval around the price stability target should suffice BIS Review 56/1997  -4-  to absorb transitory effects on the price level. Last year, however, the fall in interest rates was very marked because many factors had a concerted effect that rapidly altered the picture of inflation. The magnitude of that interest rate fall is also largely responsible for the weak price trend to date in 1997.
1-17 Haldane, Andrew G. (2017) ‘Work, Wages and Monetary Policy’ speech given at the National Science and Media Museum, Bradford IMF (2013) ‘The dog that didn’t bark: has inflation been muzzled or was it just sleeping?’ April World Economic Outlook, Chapter 3 Mishkin, Frederic (2007) ‘Inflation Dynamics’ NBER working paper 13147 Nagel, S and Malmendier, U (2011) 'Depression Babies: Do Macroeconomic Experiences Affect Risk Taking?’ Quarterly Journal of Economics, Vol126(1), pp373-416 Phillips, A W (1958) ‘The relation between unemployment and the rate of change of money wage rates in the United Kingdom, 1861–1957’ Economica, Vol. 25, No. 100, p. 283–99 Pizzinelli, Carlo and Bradley Speigner (2017) ‘Matching Efficiency and Labour Market Heterogeneity in the United Kingdom’ Bank of England Working Paper No. 667 Saunders, Michael (2017) ‘The Labour Market’ speech given at the Resolution Foundation, London Stiglitz, Joseph (1997) 'Reflections on the natural rate hypothesis' Journal of Economic Perspectives, 11, 3–10 Yellen, Janet (2017) ‘Inflation, Uncertainty and Monetary Policy’ Speech at the "Prospects for Growth: Reassessing the Fundamentals" 59th Annual Meeting of the National Association for Business Economics, Cleveland, Ohio  18  All speeches are available online at www.bankofengland.co.uk/speeches  18

Dear participants The productivity and the quality of work are major determinants of life quality, affecting nutrition, health and education, social protection, and fair treatment. Jobs are particularly important for the poor, whose labour is often their only asset and a primary route to poverty eradication. It is for this reason, that we at the central bank recognise skills development as an economic imperative. This is because it increases productivity of economic agents. Chairperson In the aftermath of the recent global financial crisis of 2008, employment has re-emerged as a top priority area across the world. A large and growing young population can be a driver for economic growth and social progress provided they access quality education and health, and are engaged in decent employment, without which, many young people will not be able to escape negative social vices and poverty. In recognition, of the foregoing, the National Budget for 2013 whose theme is; “Delivering Inclusive Development and Social Justice” has for the first time put job creation at the centre of its development agenda by explicitly targeting the creation of 200,000 jobs in 2013. BIS central bankers’ speeches  1  Sectors targeted for these jobs are agriculture, tourism, manufacturing and construction (including infrastructure). Ladies and gentlemen Sustained efforts to bring in private investment coupled with supportive public policies and investment, would contribute to enhancing productive capacities and generating the much needed jobs in our country.
Both the central bank and the government may harbour a false view in them that allowing the exchange rate to depreciate is equivalent to publicly accepting the failure of their actions, it would further raise the cost of living and it would worsen the budgetary outcome by raising the interest cost on the government’s external debt. This false view may force the government to defend the exchange rate at the expense of the loss of foreign reserves of the central bank. At this stage, the auditors should notice a change in the composition of the assets of a central bank: a decline in the foreign assets and an increase in the domestic assets mainly in the form of lending to the government. The change in the asset structure of a central bank leads to a series of unfavourable outcomes that raises the risk of insolvency of a central bank. First, there will be a change in the composition of the income of a central bank. The foreign income will fall and the domestic interest income will rise. Second, the decline in the foreign assets will force a central bank to borrow abroad on a short term basis, raising its foreign liabilities and interest out-payments. Third, if the government is still bent on keeping the fixed exchange rate, even the borrowed funds would be used to defend the exchange rate, converting the net foreign assets of a central bank to a net foreign liability position.

Accordingly, in order to raise its expenditure levels (or alternatively, to provide more funding to the government), it may go back on its tight monetary policy and reflate the economy so as to extract real resources from the public. It, therefore, tries to fool the people by generating inflation without their knowledge. However, the public are also smart and aware that the central bank would reverse the course of its policy by inflating the economy after it has made small gains. This mistrust of the public about the policy actions of a central bank is well revealed by the exceedingly high inflation expectations they normally form about the future trends in inflation. Consequently, they also try to fool the central bank by asking for higher wages, if they are employees, or higher future contract prices, if they are producers, than the normal wage or contract price levels permissible under the now low inflation rate. This battle between the central bank and the people will trap the economy in a high inflation-high wage spiral making it a self-defeating enterprise for both the central bank and the public. The high inflation in the economy now exerts pressure on the exchange rate to depreciate.
The changing structural pattern of trade in the region reflects the growing intra-regional trade which now accounts for almost half of Asia's total trade from just a fifth a decade ago. Intra-regional trade has also been enhanced by the opening up of large regional markets such as China. The share of East Asian exports to China has doubled in the past decade to about 10%. While there has been significant attention on the  2  BIS Review 62/2002  competition that China will create for other countries in the region, the focus should also be on the complementarities that are already feeding the regional growth process. A third discernable trend in the region is the growing importance of domestic demand in the regional economies, supported by domestic-oriented policies in recent years, which would ensure that the gains in intra-regional trade could be sustained. In terms of financial flows, the development of regional markets is contributing towards strengthening the prospects for a deepening of Asian financial markets and promoting greater regional financial integration. The region is also studying the feasibility of establishing an Asian Bond Market to recycle part of the region's high level of savings to finance productive activity within the regional countries. To encourage the regional flows to be recycled into investments in the region, efforts have been taken to develop the capital market particularly in the area of securitisation, credit guarantee and market infrastructure.

The big questions now are about the extent of the slowdown and how long it will last. On an optimistic view we may be largely through the sharp downward stock adjustment, and with consumption so far holding up better than generally expected, and with the possibility that investment will recover as the spread of ICT through the economy resumes, US activity may pick up as we move, say, into next year. But the pessimist can point to the weakness of private sector saving, which could induce more cautious consumer behaviour; he can point to a possible overhang of past investment excesses; and he can point to the US external deficit which will need to be corrected at some point. BIS Review 56/2001  1  These adjustments might take place gradually over time, implying a more protracted period of relatively slow growth in the US Or, if you are really pessimistic, you might anticipate more abrupt adjustment, implying a period of negative US growth and global financial instability. The recent somewhat erratic recovery of US financial markets from their earlier gloom suggests that they may have begun to side somewhat tentatively with the optimists; but some of the survey evidence of consumer and business confidence, on the other hand, supports a more pessimistic view. The truth is that none of us knows with any great confidence just how the US situation will evolve. For what it is worth I remain modestly optimistic, but I am very conscious of the downside risks.
The greater use of RMB in international transactions will be closely related to China’s financial reforms and liberalisation, with new fund flow channels being opened up in RMB. For example, the RMB QFII scheme allows offshore institutions to use RMB funds to invest in Chinese capital markets, and it is a new channel in addition to the US dollar-based QFII scheme. And further to a recent relaxation, outflows under the QDII scheme can also be made in RMB. Such developments, in turn, will bolster the use of the RMB in trade, foreign direct investment and international transactions, thereby supporting the further development of the offshore RMB market. 13. While recent developments in RMB have been exciting, given the possible scope of future expansion, we are probably still only at the early stage of what could be more significant changes in the years to come. After all, RMB deposits and bonds outstanding in the offshore market only account for about one percent of onshore deposits and outstanding debt respectively. The possibility for expansion remains substantial. 14. One of the aims of the Hong Kong-London Forum is to assess what all this means to the financial institutions and to corporates — many of whose representatives are gathered here today. 15. For corporates, especially those already having business links with China, it is important to get prepared for the increasing use of RMB as a currency for transaction, financing and investments.

Until now, the channels for cross-border flows are only open to current account items such as trade, and to direct investments under the capital account. Portfolio investments under the capital account into and out of China are mainly confined to designated channels and are subject to quotas, for example, the Qualified Foreign Institutional Investor (QFII) scheme with quotas totalling $ billion, and the Qualified Domestic Institutional Investor (QDII) scheme with quotas of $ billion. It can be reasonably expected that a further opening of the capital account would entail liberalisation of these channels and the addition of new avenues. These would result in an increase in cross-border capital flows. BIS central bankers’ speeches  1  7. Although it may not be easy to provide a precise estimate of the magnitude of the flows, given that China’s economy is the second largest in the world, and taking into account the size of both its domestic savings and its capital markets, one can probably say that the size of capital flows resulting from China’s capital account liberalisation would likely be felt in the global financial system. 8. From the perspective of Chinese savers, given their high level of savings and the fact that their investment options are mostly limited to domestic markets at present, there would be a desire on their part for investment diversification into international markets. The resulting investment flows, as they are liberalised, could be substantial for individual markets where these funds flow into. 9.
This combination – a more robust and resilient LIBOR for transactions that require a reference rate with a bank credit risk component and the development of an alternative reference rate for transactions like interest rate derivatives that don’t – will strengthen our financial system and help undo some of the damage caused by earlier transgressions. But this is only a necessary and not a sufficient set of conditions. To achieve the outcome desired, financial institutions also need to have in place the appropriate incentives and controls. Thank you for your attention. I would be happy to take a few questions. BIS central bankers’ speeches  7

These include the summer school, which brings in leading academics to teach courses in relevant areas to participants, a large number of whom are central bankers. It also organises a highly-demanded summer internship programme for top undergraduate students. And it collaborates with the Banco de España in the training of bank supervisors, and in the organisation of research workshops and conferences. In terms of broader service to Spanish society, three faculty members participate in the Council on Economic Advisors that advises the Spanish Ministry of Economic Affairs; one is a member of the Multidisciplinary Group that advises the Ministry of Science and Innovation; another is a member of the Advisory Board of the Spanish Independent Agency for Fiscal Responsibility, and another is chair of the Scientific Committee of the Spanish State Research Agency. All in all, and from the perspective of the Banco de España, CEMFI is indeed very good value for money. Finally, I would like to take this opportunity to congratulate Mónica Martínez-Bravo for the recent award of the Banco Sabadell Prize for Economic Research, given to a Spanish researcher under the age of 40 for outstanding contributions to economics and social sciences. Congratulations, Mónica! To conclude, let me address the students of the class of 2021. You are now entering a very exciting period of your lives.
Last year, another report13 analysed how climate risk shocks could spread throughout the financial system, harming companies and banks alike. Transition risks stemming from, for instance, a surge in carbon prices may be magnified because of economic and financial linkages between and across financial institutions and companies. Interdependent natural hazards, such as water stress, heat stress and wildfires – which are painfully familiar to us in Spain – can amplify physical climate risk, as they can cluster together and exacerbate each other. Market dynamics can also magnify the financial impact of physical risks. Given the identification of potential systemic financial risk associated with climate change, it is necessary to study the development of appropriate macroprudential policy tools to tackle it in a manner consistent with prudential mandates to preserve financial stability. For the near term, the ESRB-ECB report suggests the adaptation of existing regulatory instruments, such as the systemic risk buffer or concentration thresholds, as a possible avenue to tackle climate risk in the banking sector. In any case, this is a task that demands joining efforts between macroprudential policy and microprudential supervision, and taking adequate stock of developments in other policy realms, such as fiscal and monetary initiatives. 12  Advancing macroprudential tools for cyber resilience, ESRB Report, February 2023. 13  The macroprudential challenge of climate change, July 2022, by ECB/ESRB Project Team on climate risk monitoring. Conclusion The ESRB’s general Warning that I referred to in the first part of my intervention called for heightened awareness of risks to financial stability.

9  See Letter to Members of the European Parliament on the AIFMD review, ESRB, 23 March 2022; Letter to the Council Working Party on the AIFMD review, ESRB, 23 March 2022; Letter to Members of the European Parliament on the Review of Solvency II, ESRB, 2 February 2022; Letter to the Council Working Party on the Review of Solvency II, ESRB, 2 February 2022; Letter to Members of the European Parliament on the Solvency II Review and Liquidity Risk Management, ESRB, 16 November 2022; Letter to the Council Working Party on the Solvency II Review and Liquidity Risk Management, ESRB, 16 November 2022; Letter to Members of the European Parliament on EMIR review, ESRB, 20 March 2023; Letter to the Council Working Party on EMIR review, ESRB, 20 March 2023. 10  See Making macroprudential policy fit for the next decade, Keynote speech by Pablo Hernández de Cos, Governor of the Banco de España and Chair of the Advisory Technical Committee of the European Systemic Risk Board, at the 6th DNB-Riksbank-Bundesbank Macroprudential Conference, June 2022. 11  Recommendation of the European Systemic Risk Board of 2 December 2021 on a pan-European systemic cyber incident coordination framework for relevant authorities (ESRB/2021/17). strengthen coordination between financial authorities in the EU as well as coordination between other authorities in the EU and at international level, including the Bank of England.