samchain/econo-pairs-v1 huggingface dataset:
Chart 3: Paths for policy rates implied by forward market interest rates UK EA  US Japan  Per 3.5  Chart 4: International policy rates over time Higher than 5% Between 1% and 3% Less than zero  Between 3% and 5% Between 0% and 1%  Proportion of regions  100%  3.0 2.5  80%  2.0 60%  1.5 1.0  40%  0.5 0.0  20%  -0.5 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 2000  Sources: Bloomberg and Bank Calculations. Notes: Instantaneous forward rates based on OIS contracts for the UK and euro area and government bonds for the US and Japan. 2005  2010  0% 2015  Sources: Thomson Reuters Datastream, CEIC and Bank calculations. Notes: Included regions are: Australia, Brazil, Canada, China, Euro area, Hong Kong, India, Indonesia, Malaysia, New Zealand, Norway, Philippines, Singapore, South Korea, Sweden, Switzerland, Taiwan, Thailand, UK and US. Together these countries account for approximately 70% of PPP-weighted world GDP. Of course, what goes down can also bounce back up. Recently, there has been some upwards movement in UK and US yield curves. But yields elsewhere, especially in Europe, have continued to fall. And the longer-term trend is clear: a persistent ratcheting-down in interest rates across all maturities and virtually all countries, to reach unprecedentedly low levels. As a recent example of that, Chart 5 plots the UK forward curve at monthly intervals over the past 9 months.

Chart 15: Actual and estimated UK wage growth Actual Estimated  Percent change on a year ealier 8  6  4  2  The first is simply that the lags from lower unemployment to wage growth 0 are a little longer than in the past. That might be the case because job-to-job -2 flows in the labour market have been 2004 2006 2008 2010 2012 2014 low by historical standards, only recently picking up towards pre- Sources: ONS and Bank calculations. Notes: Dashed line shows inrecession levels. If so, we might sample fitted values from an estimated wage equation. expect the recent undershoot in wages to course-correct in the period ahead, as labour market activity picks up. In essence, this is the judgement underpinning the MPC’s central view of wages in the February Inflation Report. Wage growth is projected to rise, reaching 3.4% by end-2015. In effect, wages error-correct. There is some tentative evidence of wage growth picking up over the past few months, although yesterday’s wage data were notably weaker. If this pick-up were to continue, the wage puzzle would have been benign. Indeed, with slack eroding, we might then be concerned that wage pressures could overshoot, posing upside risks to the inflation target.7 But there are other explanations of the wage puzzle which pose downside inflation risks. One is that the Phillips curve has become less steep than in the past. This would mean that a fall in unemployment might have a lower impact on wage pressures than in the past.
Today, we central bankers are responsible for trust: we “produce” it, and we stand accountable for it. Such a responsibility entails a strong personal component: our behaviour has to be flawless, and driven by real functional requirements and high ethical  Page 3 sur 10 standards. But let me today focus on the institutional and collective foundations of trust. II. The golden triangle of trust Trust relies on three key elements, which together form the golden triangle of trust: independence, mandate and accountability of central banks. They cover different notions but they closely intertwine. Some may take them for granted, but they are actually the result of a long historical progress, and each of them is being challenged today. Independence  Mandate  Accountability  1. The long quest for the independence of the issuer, and its current calling into question As early as in the 4th century B.C., Aristotle famously identified the three functions fulfilled by money: medium of exchange, unit of account, and store of value. He complemented this brilliant theoretical approach with ethical guidelines,i opposing “unnatural” chrematistics – or personal enrichment – and virtuous economics – oikonomia, literally household management, to the benefit of the entire community. Aristotle had a strong influence on the European Middle Ages, but his ethics of currency progressively faded into the background.

The context of the Russian war in Ukraine challenges us to reinvent the dialogue with political authorities, for at least three reasons: because geopolitics are today a major determinant of the economy; because the energy markets, their regulation and pricing are key for inflation; and lastly because fiscal choices regarding subsidies to households or even to firms are far from neutral for monetary authorities. Another challenge, and a much more tough one, is that the populist ideology creates an atmosphere of general mistrust of institutions – and still more of independent ones. In the name of popular sovereignty, we would return to a power of elected sovereign that would be absolute – and not relative anymore. At worst, this would call into question our democracy and its necessary checks and balances. At the very least, it is imperative for us to be efficient in our mandate, and to increase our accountability. 2. Efficiency of our mandate Price stability, which is a prerequisite for long-term growth, is the primary objective of most central banks. Broader mandates nevertheless apply to some, notably the Federal Reserve with its dual objective on employment and inflation. Other central banks have expressed sensitivity to inequalities, or to other issues, and have therefore contemplated a broadening of their mandate. Some observers questioned this alleged “mission creep”, and wondered whether central banks have lost sight of their primary responsibility.
Another highly relevant area of statistical work for central bankers concerns statistics and indicators for financial stability analysis. In the aftermath of the Asian crises, which brought to the fore the importance of financial stability analysis, the related conceptual framework was strengthened and progress in understanding the genesis and propagation of financial instability was made. Central banks have an interest in financial stability issues particularly, but not exclusively, because financial stability supports sustainable price stability in the medium and long run. This implies that financial stability indicators - whether in the form of key balance sheet ratios for monetary financial institutions or leverage indices for non-financial corporations - may acquire an important status in the data set on which the central bank bases its assessment of the risks to price stability over extended horizons. The forward-looking nature of the ECB’s monetary policy strategy allows an extension of the policy-relevant horizon sufficiently into the future to factor in the likely effects of financial imbalances that may be forming. At the same time, obtaining a comprehensive and timely statistical view of the financial system helps to identify the sources of such risks. This is the rationale for central banks’ keen interest in financial stability analysis. But financial stability analysis is complex and, hence, information-intensive. Data are needed not only on the financial situation of banks, but also on that of other financial corporations, such as insurance corporations. Moreover, the financial position of non-financial corporations and households has to be carefully assessed.

Elvira Nabiullina: Speech - OPORA RUS Governor SIA session Speech by Ms Elvira Nabiullina, Governor of the Bank of Russia, at the OPORA RUS Governor SIA session, 3 December 2020. * * * Good afternoon, I am happy to welcome you, whether you are now in the Kaliningrad Region or are video conferencing — this format is becoming quite common now. I hope that this meeting is attended by a large number of participants. Indeed, I was listening very attentively and I think that the approach the Kaliningrad Region is pursuing to develop small and medium-sized businesses is promising and comprehensive. However, we are all very well aware that a lot of projects depend on how accessible funding is — it would be impossible to implement a project when there is no access to funding. Today’s meeting is very important to me: although the Bank of Russia influences the economy through the financial sector, the ultimate goal of our work is to ensure that the financial sector helps the economy and people overcome hardships and develop. Of course, we have always been concerned about the issues related to the financing of small enterprises. We carry out regular meetings with OPORA RUSSIA President Alexander Kalinin several times a year to discuss the most topical problems and advance in both the regulation and other areas associated with the development of multiple projects.
Thomas Jordan: Why a strong education system must be an important concern for the Swiss National Bank Summary of a speech by Mr Thomas Jordan, Chairman of the Governing Board of the Swiss National Bank, at the opening ceremony of the Faculty of Economics and Management at the University of Lucerne, Lucerne, 6 September 2016. *  *  *  The complete speech can be found in German on the Swiss National Bank’s website (http://www.snb.ch/). A strong education system is a cornerstone for a country’s prosperity. Switzerland has a federally structured, flexible, high-quality education system. It stands out for its focus on the goal of employability, which is particularly reflected in the dual vocational training system that is closely aligned to the real needs of companies. The education system contributes to an innovative, flexible and robust Swiss economy which – given structural and technological changes – can continue to be successful in future. The labour market would not work nearly as well without solid education, and the culture of stability would be less well-anchored in society. These strengths allow the Swiss National Bank (SNB) to conduct a monetary policy geared toward long-term stability. Attractive universities are an important component of a good education system. The SNB maintains an intensive exchange of information and ideas with academia, with the focus on topics relevant to central bank policy. For it can only fulfil its mandate optimally if the relevant research results flow adequately into the decision-making process.

Importance of industry collaborative efforts Now I will touch on the third and last point. The payments industry in Malaysia has a history of collaboration in industry-wide infrastructure developments. A notable example is the migration from magnetic stripe to chip-based cards. The migration exercise, which was completed in 2005, successfully eradicated cases of counterfeit fraud and contributed to greater confidence in the use of payment cards in Malaysia. As a result, the investment cost of about RM200 million was recovered in just two and a half years, most of it arising from cost savings from fraud avoidance. Tourist spending via credit cards had also doubled from RM4.3 billion in 2006 to RM8.7 billion in 2014, signifying greater confidence and the ease of use of payment cards in Malaysia. This is a very good illustration on how industry collaboration in the area of payment systems has contributed to the country’s economic growth. A successful payment system is often dependent on the network of payment systems reaching an optimum size, thus enabling its participants to build critical mass and achieve economies of scale. However, building a payment system infrastructure and expanding the network can be costly to an individual market player. Hence, the industry should pool its resources to develop and share infrastructure costs. As a principle, basic payment infrastructure should not be used as a competitive tool but rather as a means to reduce cost, promote inter-operability and support an enlarged network.
All of these central bank functions are mutually dependent and, together, highlight the fact that the structure and workings of the banking system are integral to a country’s financial stability and economic growth. Clearly, monetary policy cannot succeed in its mission if the underlying financial system is unstable. The importance of an efficient, safe and sound banking and financial system for a country’s long-term economic prospects cannot be overstated. In any market economy, the banking and financial system plays a central role in mobilizing a society’s savings and in channeling these savings into investment and other productive uses. This intermediation process is one of the core determinants of the pace of a country’s economic development. Moreover, the banking and financial system must facilitate transactions in an economy by ensuring that they can be effected safely and swiftly on an ongoing basis. Both buyers and sellers of goods and services must have confidence that instruments used to make payments will be honored and accepted by all parties. These crucial functions of transforming savings into productive uses and making payments are often taken for granted. But, in fact, it can be difficult to ensure that the legal and institutional framework within which these functions are performed is consistent with the often conflicting goals of free choice, economic efficiency, safety and financial market stability. BIS Review 17/1997  -4-  Experience has proven that there is no easy way to shape financial institutions in a manner that appropriately balances these goals under changing economic conditions.

Moreover, while there is no long-run trade-off between unemployment, or output, and inflation, both formal evidence and common sense observation on wage and price rigidities attest to the existence of such a trade-off in the short run. In the long run, however, monetary policy’s impact is only on inflation; potential output primarily is determined by advances in technology, growth in human and physical capital and other real resources. Because of the uncertainty about the timing and significance of short-term monetary policy effects on economic activity, as well as all other uncertainties concerning the economy, there are always differences of view about the speed with which policy should be adjusted, and on the balance of risks in dealing with ongoing economic developments. These conflicts become more marked when an economy confronts supply shocks that drive up prices BIS Review 17/1997  -3-  sharply and suddenly -- such as the two oil shocks of the 1970s. In those circumstances, from my perspective, the appropriate course, consistent with maintaining longer term price stability, should be to bring inflation down somewhat gradually, as the economy adjusts to the shift in relative prices. As I see it, monetary policy must be formulated cautiously, and cannot ignore business cycle developments. In establishing price stability as the primary goal of monetary policy, therefore, it is best to recognize that monetary policy does affect output in the short run.
Ravi Menon: Singapore's financial sector agile and resilient amid Covid-19 Edited transcript of fireside chat by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at ACI Live Aid: Financial Markets Give Back, 29 May 2020. * * *  Operational Resilience The financial sector has been quite remarkably resilient in the face of Covid-19. All financial services have remained open, except those involving face-to-face interactions with customers outside of bank branches. During the circuit breaker1 period, 85% of workers in the financial industry have been able to work from home. MAS itself is close to 90% of staff working from home. I am sure there is some degradation of productivity but, by and large, the sector has been able to function. We are grateful for the strong investments that Singapore’s financial sector has made in digital transformation over the last five to six years. This has put the financial industry in a good place during the circuit breaker. If our financial sector had not made these investments - imagine if there was no retail electronic payment system, or if there were no infrastructure for digital banking or selling insurance online or trading from home - we would be in a much worse situation today. A good part of financial sector activities has moved on to virtual platforms. The current situation is of course not without its challenges. Many financial institutions have had to make significant adjustments to the new environment.

•  In financial firms, it is important that these policies and practices dispel the perception of good ethics as a constraint on profitability or hurdle to career advancement. We are beginning to see some progress. BIS central bankers’ speeches  5  •  Performance appraisals in some banks now take into account how an employee’s conduct is consistent with the banks’ avowed principles and values. •  Others have developed balanced scorecards for remuneration that go beyond traditional measures of financial performance to include indicators relating to culture and controls. •  Yet others take into account a business unit’s record on compliance, customer experience, internal audit findings and other relevant considerations to underscore the organisation’s behavioural expectations of staff. Conclusion Let me conclude. The global financial industry’s standing with the public is at an inflection point. It could continue a downward spiral of mistrust with yet more egregious misconduct, or it could seize this opportunity to restore high ethical standards. Thankfully, we are in a better place in Singapore. The financial industry here is generally well regarded and trusted. But we have not been immune to some of the egregious practices in global finance, for example, attempts to manipulate financial benchmarks and the mis-selling of financial products. We must be on our guard, and work to further strengthen ethical standards and a culture of trust in the industry. •  We must foster a culture in the industry that looks beyond the question “is this legal?” to the larger question “is this right?”.
Diana Sorensen’s dictum One of the most intriguing living thinkers, Diana Sorensen, the dean of arts and humanities at Harvard University, defines a knowledgeable graduate taking wing as follows: “He or she is competent in making discerning judgments with tools derived from science, engineering, social science, the arts and humanities. He or she should be a persuasive speaker who can articulate the reasons for his positions; who can write with clarity, elegance and conceptual power; an innovator who will take risks but first makes sure the limb they go out on is a sturdy one; a creative individual who has faced challenges posed by artistic production and experimentation; a global citizen who can speak, read, write in at least a second language; and who will learn what it takes to negotiate different world views emanating from different cultural traditions, a tolerant yet rigorous thinker whose moral compass is guided by ethical reasoning.”3 Class of 2014, I don’t want to put any pressure on you! But that pretty much summarizes the skill set we all hope you have started to acquire at Bryant and will now go on to hone in life. 2  If memory serves from my days at Oxford University, this observation was noted by Graham Chapman, one of the stalwarts of Monty Python’s Flying Circus. 3  Dean Sorensen’s comments are summarized in “Coming Back, Looking Forward”, Harvard Gazette, Sept. 26, 2012.

It is against this background that the measures adopted to soften the economic and social consequences of the war must be assessed. The National Plan to respond to the economic and social fallout of the war in Ukraine, approved by the Spanish Cabinet on 29 March,5 includes measures that will come at a direct cost of € billion in 2022, according to Government estimates.67 One area of fiscal policy where more resolute action would be desirable is the formulation of a credible commitment to budgetary stability over the medium term. This would help limit the risks of financial market tensions that could be fuelled by the current climate of high uncertainty. This commitment should take the form of a gradual fiscal consolidation programme, to be implemented once the recovery takes hold. A gradual adjustment process minimises the possibility of any abrupt changes in the budgetary policy stance that might hamper the recovery under way. Increasing the economy’s potential output would also help reduce the high level of government debt. This would require reforms that address the economy’s structural shortcomings. NGEU funds could also be particularly useful in implementing these reforms and the investments required to support the changes. 5  See Real Decreto-ley 6/2022 (available in Spanish only). 6  In addition to this amount, there is a contingent liability of € billion linked to the new ICO guarantee facility approved as part of the raft of measures to support business liquidity needs stemming from the temporary increase in energy and fuel costs.
This is especially the case if the collateral is lower quality and markets are already illiquid. Moreover, if creditors are left with the collateral instead of being repaid, fear of widespread collateral liquidation might further erode collateral values. If investors respond by seeking more collateral to ensure they will be secured – that is, that they will be made whole in a liquidation scenario – the firm may run out of high-quality collateral that the firm can borrow against. This is a significant risk when a financial firm is highly leveraged and equity is only a very small proportion of total assets.5 The risks of liquidity crises are also exacerbated by some structural sources of instability in the financial system. Some of these sources are endemic to the nature of the financial intermediation process and banking. Others are more specific to the idiosyncratic features of our particular system. Both types deserve attention because they tend to amplify the pressures that lead to liquidity runs. Turning first to the more inherent sources of instability, there are at least two that are worthy of mention. The first instability stems from the fact that most financial firms engage in maturity transformation – the maturity of their assets is longer than the maturity of their liabilities.

Ladies and Gentlemen, Let me take a moment to say a few words on Islamic banking. Today, Islamic banking in Malaysia has firmed its position as a viable and vibrant component of the banking system. Bank Negara Malaysia has been in the forefront in providing the necessary and required infrastructure for the sector to grow further. From a market share of virtually nil a decade ago, Islamic banking has captured more than 8% of the assets of the banking system and is poised to reach 20% by 2010. We capitalized on the dual banking system which we believed is the right approach, and we will continue to embark in this direction. There are currently two Islamic banks and 33 conventional banks with Islamic windows offering the full range of Islamic financial services, and the industry has recorded commendable growth at an annual rate of 48% in terms of assets. At the end of March 2002, the assets mobilised by the Islamic banking sector amounted to RM 59 billion. Deposits and financing mobilized during the same period amounted to RM 48 billion and RM 30.1 billion respectively. Islamic banking in Malaysia is now at the threshold of entering its next stage of development, to expand on a global basis, to gain greater acceptance as an effective and efficient means of intermediation and to contribute to the overall wealth creation.