samchain/econo-pairs-v1 huggingface dataset:
Next year we are expecting largely zero growth and after that a fairly weak increase. Domestic demand in particular is expected to be weak for a long time to come in the euro area. The weak domestic demand means that the euro area is dependent on a boost from abroad – in particular the United States and other important trading partners – to be able to make a recovery. Since the Monetary Policy Report was published statistics received from Eurostat have reinforced the picture of production in the euro area beginning to stabilise at a lower level following the heavy fall at the beginning of the year. GDP fell by only 0.1 per cent between the first and second quarters of the year, which was much better than we had estimated. In addition, it can be noted that the purchasing managers’ index for the euro area rose in July for the fifth month in a row (see Figure 9). Both the manufacturing and service sectors show an improvement in July. However, the index is still below 50, which is the level indicating growth. Employment is continuing to be weak and unemployment rose to 9.4 per cent in June. Inflation measured in terms of the EU harmonised index, the HICP, was -0.7 per cent in July. The HICP is not affected by interest rate cuts in the same way as the Swedish CPI, but it is affected by energy prices.

This is a slightly better outcome than in our July forecast, where we assumed that GDP would fall by 0.3 per cent in the second quarter and that the fall would not come to a halt until the third quarter. However, there was unusually great uncertainty regarding the preliminary national accounts figures on this occasion. In recent months various confidence indicators have also shown an improvement. The National Institute of Economic Research’s Economic Tendency Survey, which summarises companies’ and households’ views of the economic situation, increased by almost seven units in July, to 87.1. However, the level is still below 100 and indicates that the mood among companies and households is still much weaker than normal (see Figure 13). 6 The purchasing managers’ index for July was also more positive than market expectations had implied. It rose by almost four units to 54.3 and was thus above 50 for the second month in a row (see Figure 14). The purchasing managers’ index is usually a slightly quicker indicator of developments than the economic tendency survey and an index above 50 indicates growth. 7 Labour market continues to weaken Our assessment in the most recent Monetary Policy Report was that the labour market would continue to be weak. A deterioration in the labour market usually lags behind in an economic downturn, which was also the case this time.
In the Bank’s case, we will be engaging bilaterally with relevant counterparties over the coming months, asking questions and seeking greater clarity. I’d strongly encourage others users of FX markets to do something similar. Work together too. It is good to see the UK’s Investment Association, for example, pushing for the standardisation of reject codes. But given the amount at stake, the buyside ought to be exerting more concerted pressure for better disclosures across the board. The GFXC’s upcoming three-yearly review of the Code provides an ideal opportunity to look again at the scope for stronger 12  See Box 4 in https://www.bankofengland.co.uk/-/media/boe/files/report/2015/fair-and-effective-markets-review-final-report https://www.globalfxc.org/docs/fx_global.pdf https://www.globalfxc.org/docs/the_role_of_disclosure_and_transparency.pdf 15 https://www.risk.net/derivatives/6888556/how-the-top-50-liquidity-providers-tackle-forex-last-look 13 14  10  All speeches are available online at www.bankofengland.co.uk/news/speeches  10  market-wide standards, including on anonymous platforms. Please make sure your local FX Committee hears your views as this work progresses. A second response to the challenges of greater fragmentation comes from seeking more effective, robust and independent aggregation, analytical and execution tools – using technology to beat technology at its own game. This isn’t a free lunch: but putting liquidity providers into competition through robust aggregation and execution tools makes good business sense. Of course, you need to be alert to the potential for services offering lower spreads to claw back that gain through greater price slippage.

The firm has access to a pool of liquidity providers, and will compare pre-trade price quotes, perhaps making use of proprietary TCA tools from those providing liquidity. It might execute some trades electronically. But it has bigger costs to worry about than FX trade execution alone – including the broader bundle of services it needs across asset classes. And it is conscious that larger FX trades involve material risk, including as a result of market dynamics it doesn’t necessarily understand. So it will also work to maintain broader relationships with liquidity providers – and will tend to revert to voice trading with a trusted counterparty for larger orders, or at times of heightened volatility. It may not always have complete clarity on the basis on which such trades are executed (internalised vs externally traded, principal vs agent) or rejected. And it recognises that, in seeking quotes, it may be leaking information about its position. But broadly speaking it is content with the service it receives on FX, and feels it has bigger fish to fry elsewhere. In many ways, it is hard to label this case ‘bad’. The firm is trying to inform itself about market trends. But it recognises that FX is a professional market, whose complexities it needs assistance to navigate. It knows it may not always be getting the finest price, or the perfect service – but feels that the cost/benefit case for investing in a lot of extra data or understanding is not in its favour.
Since the onset of the crisis, monetary policy has been strongly accommodating, more so both in 2013 and in 2014 to date. On the conventional front, official interest rates have been cut on three occasions since January last year. As a result, the main refinancing operations rate has reached, for practical purposes, its lower bound (0.15%). And the remuneration banks receive for their deposits in the Eurosystem stands, following the recent decisions adopted on 5 June, in negative territory (–0.10%), which should promote a greater and lasting injection of liquidity into the markets. As regards liquidity, moreover, it was resolved at the Governing Council meeting on 5 June to extend the current policy of fixed rate full allotment tender procedures at least until  2  BIS central bankers’ speeches  December 2016. It was also decided to suspend the fine-tuning operation sterilising the purchases under the Securities Market Programme. The ECB thereby ensures the continuity and scope of the policy of generous provision of liquid funds adopted since what was practically the very onset of the crisis. Finally, regarding unconventional measures, and following the adoption last year of forward guidance, significant additional steps have been taken in June. Firstly, targeted long-term refinancing operations explicitly geared to promoting bank lending to households and firms were announced. Further, it was decided to step up the work under way to enable a framework to be designed for outright ABS purchases by the ECB.

Thirdly, there is no indication – from our perspective – that the risks entered into in the banking industry have risen: market and interest rate risk have only increased slightly on an aggregate level, and credit risk even seems to have fallen. Consequently, the banking sector is in good shape at the moment. As far as prospects for the near future are concerned, we believe that the macroeconomic environment and financial market conditions pose no major threat to the stability of the Swiss banking system. The outlook for 2005 indicates that economic growth in most regions will only slow down at a moderate pace. In addition, the available indicators suggest that there is currently little risk of contagion effects causing a crisis in the Swiss banking sector. Nevertheless, there are still potential sources of risk. They pertain to credit risks in particular. Firstly, an unexpectedly sharp economic downturn could have a serious impact on the quality of the loan portfolios and the stock market. Secondly, should we witness a swift economic recovery, however, a sharp rise in the still very low interest rates could also result in a deterioration of the loan portfolio. This  is because the growing interest burden would suddenly put considerable pressure on households and companies with mortgages to pay off. Banks would also be directly affected by the steep interest rate hike, as the interest rates on their assets tend to be fixed for a longer period than those on their liabilities.
The improved conditions in financial markets have indicated that not all our liquidity measures are needed to the same extent as in the past. Similarly, it is our intention to discontinue the 6-months refinancing operations after the last operation at the end of March next year. Liquidity developments in non-euro area EU countries Allow me to say a few words on the broader implications of our decisions on non-standard measures, with a particular focus on the EU Member States outside the euro area. Macroeconomic and financial conditions in these countries seem to have stabilised, although there are significant differences across the region. A general “sudden stop” in capital flows to  2  BIS Review 161/2009  central and eastern Europe has not materialised. The significant presence of foreign banks seems to have had a stabilising effect in this regard, as parent banks have to a large degree been able to maintain their exposures to the region. The ECB’s extensive liquidity provision to parent banks established in the euro area has contributed to this. In addition, the ECB has provided liquidity support to some non-euro area central banks in cases of market malfunctioning or to facilitate the functioning of the international financial system. Fiscal policies in the euro area Finally, I should like to add a few comments on fiscal exit strategies. Many euro area governments are faced with high and sharply rising fiscal imbalances, which are not sustainable over the longer term.

And the continuing efforts of the banking sector also represent challenges of their own: banks filed over 68,000 or 90% of the suspicious transaction reports (STRs) with the JFIU in a year. And that is just the STRs: we all know what that means in terms of the massive amount of data that banks are monitoring, screening and analysing on an ongoing basis. 5. The more difficult part of the answer to my question therefore means looking forward and requires vision and – dare I say it – aspiration – because we know that FATF evaluations represent a snap shot. There are always new and emerging risks, to which the HKMA and banks have stayed vigilant and agile; criminals are also exploiting new technology and innovations to create terrible harm to consumers and the integrity of the financial system. Banks that play a frontline role in combating that harm, not only by applying preventive measures when on-boarding customers, but increasingly through the value of information they are able to extract and feed into the AML/CFT eco-system and the close cooperation with the LEAs and the HKMA in converting STRs and intelligence into actions like arrests and asset recovery. 6. This is the challenge we face so we’ve taken a step back from the FATF evaluation report and asked ourselves some potent questions: is our system working as well as we would like it to be? Are the supervisory tools and techniques we have been using for years still fit-forpurpose? 7.
But we are not there yet. How shall we keep our balance in the future? In a financial crisis most of what is not built on stable foundations and does not have a robust structure is washed away. But when the situation has calmed, we have the chance to build up something new that will work better than that which failed the trials. We have this chance now. We must take part in the change work Keeping our balance once we have landed on our feet will require reforms with regard to legislation and supervision. Difficult and important challenges lie ahead of those of us who work with these issues – the central banks, the financial supervisory authorities and the legislators. Here Sweden must take on the challenge and play an active role in the international discussion. And it is necessary to act quickly. The reform work has already begun. Within the EU a new supervisory structure is being built up with regard to banks, insurance, securities and systemic risk. The new body, the European Systemic Risk Board, ESRB, will play an important role in this. Change is required in a number of different areas. The most recent crisis has demonstrated how a liquid market can very quickly dry up and become illiquid under certain conditions. Tougher rules are required regarding liquidity and the buffer that banks and credit institutions need to be able to withstand shocks. Further consideration is required here before we find a good solution.

While at first read this looks like a rare piece of good news, viewed through the lens of efforts to return inflation to target it is a mixed blessing. Indeed, the association with the mid1970s is not reassuring in that respect. Tight labour markets support wage growth, currently running at rates above those we typically deem as consistent with the inflation target. Crucially, the low unemployment rate reflects a fall in labour market participation to a significant extent. In other words, people are choosing to stop working or looking for work. The reasons for this rise in 'inactivity' are still being explored, but the after-effects of the pandemic on health are probably a key driver. Aside from the impact of long Covid, the backlog of operations and lengthening of waiting lists in the health service owing to the pandemic, the rise in mental health issues, and an increased need to provide at-home care for family members have all weighed on labour force participation. This is an area where we need further work, since the UK appears to be something of an outlier relative to its advanced economy peers. Another supply-side driver of labour market development is migration. Understanding the impact of Brexit and new government policies in the area are key. Demand issues are also now beginning to exert an influence. As the economy slowed through this year, vacancies have turned. Employment has stagnated and is now showing tentative signs of falling.
Speech  Embargo 28 April 2017, 10.00 am  Comments on the SNB’s monetary and investment policy 109th Ordinary General Meeting of Shareholders of the Swiss National Bank  Thomas J. Jordan Chairman of the Governing Board Swiss National Bank Berne, 28 April 2017  © Swiss National Bank (speech given in German)  Page 1/10  Mr President of the Bank Council Dear Shareholders Dear Guests I am delighted to be able to spend some time here with you today looking back over an eventful year and also casting a glance into the future. In the last 12 months, the international environment has been marked by two contrary developments – increasingly robust growth in the global economy on the one hand, and heightened political uncertainty on the other. In Switzerland, the moderate economic recovery continued over the course of the year, but inflation remains low and the Swiss franc is still under pressure. Overall, considerable challenges remain, both for our economy and for the Swiss National Bank. In the first part of my speech, I will outline our assessment of the current economic situation at international level and in Switzerland. I will also talk about our monetary policy and show you why our expansionary course with the negative interest rate and our willingness to intervene in the foreign exchange market remains essential in the current environment.

More than once, they brought on political tension, between those in the government who believed in it and those in the opposition, or even the military, who thought otherwise. In one incident, it even caused a change in the central bank governor. Finally, we had to float our currency in 1997. Since then, we have adopted Inflation Targeting as our monetary policy framework. A core inflation target was announced at between 0 and 3.5 % per annum. The central bank will regularly monitor economic changes and make forecasts. If we see that the rate of inflation has a tendency to exceed the range, we will adopt a tighter monetary policy stance by increasing the policy interest rate, and vice versa if we see it going under the range. The policy rate that we use is the 14 day repurchase rate. BIS Review 48/2002  1  This is completely different, of course, compared to the days of fixed currency regime when interest rates in Thailand would move mostly in tandem with the US rates. The change in the monetary policy framework therefore affects the financial environment and your businesses a great deal. Development of the bond market What other change also happened? One very important change that has occurred in Thailand is the rapid development of the bond market, which took off after the 1997 crisis. The bond market is an important tool for safety and soundness of the financial institution system.
I am therefore very glad that this session is devoted to the Facility, whose importance to Europe and especially to the euro area is much greater. 2  BIS central bankers’ speeches  I could list other problems, such as the delayed consolidation of the European banking system and the related recapitalisation of banks, and in particular the fact that the existence of the euro area has widened the long growing imbalance in the exchange of goods, capital and savings between euro area countries. The short-term rescue of the euro will not directly solve the long-term problem of imbalances, and in particular the gradually emerging path towards a fiscal pact with no significant redistribution of resources at European level will require the elimination of, or at least a considerable reduction in, the imbalances in the euro area. In the context of the three change drivers I mentioned earlier, I would like to say that the time that the ECB’s pre-Christmas actions gave the euro area, the European financial sector and many European states to solve their problems is useful but not infinite. I believe that the potential of the fiscal pact to become a true change driver is smaller than generally assumed, and I expect that the future formulation of the pact in the constitution of each country will contain (abusable) escape clauses. I base this view in particular on the fact that throughout its existence the euro area has had a tendency to soften or bend the criteria for its operation.

It is as if their judgements were expected to be consistently instinctive rather than objectively based upon their individual, open-minded, assessment - reached after careful analysis - of the most recent information available at the particular time. As a result serious economic commentary seems - perhaps temporarily - to have ceded some ground to ornithomancy - which, as of course you know, is the ancient practice of divining the future by observing the behaviour of birds - especially their flight patterns! This I suspect contributed to the surprise reaction to last week’s further rise in interest rates - which proved once again that “Hell hath no fury like a wrong-footed financial commentator”! It should not have been such a great shock. In the Inflation Report which we published a month ago we set out the analysis as I have described it to you this evening, and we drew attention to the fact that the outlook for monetary policy remained finely balanced - as it has clearly been for some months. We drew attention also to the major uncertainties surrounding the central inflation projection. These uncertainties included both the level of the exchange rate and developments in the labour market. It was - as we explained in our press notice last Thursday - the subsequent “news” essentially on these fronts, and particularly the sharp acceleration in private sector earnings growth, that caused the Committee to conclude that the necessary slowdown in domestic demand growth had become more pressing.
By remaining true to the revolution – while not wasting our time and energy in refighting it – we can all turn our attention to the challenges of the future. In this way we will reinforce the stability of the financial system, for the good of the people of the United Kingdom. The revolution is over. Long live the revolution! 6  Have big banks gotten safer? By Natasha Sarin and Lawrence H. Summers, September 2016, available here: https://www.brookings.edu/bpea-articles/have-big-banks-gotten-safer/ 9  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  9

According to a recent report by the World Economic Forum (WEF) on the future of jobs, 75 million jobs may be displaced by 2022, while 133 million new roles may emerge.15 Are we preparing our graduates for such a shift in the labor market? This is an equally pertinent question for the banking industry. According to the WEF study, 56% of bank employees will need to be re-skilled. Talent and resources in a number of functions will need to shift towards analytics, with fewer resources likely to be involved in manual work. New staff will need to be data scientists with expertise in AI, machine learning, etc. And business staff will be required to have the ability to translate such data insights into business actions. The WEF has reported that the largest barrier to embracing technology in banks, identified by 74% of financial institutions surveyed, was a lack of skill sets in the local labor market. If this is the case today, what will happen in the future? This is why the banking industry needs to build strong partnerships with educational institutions, to ensure that they are preparing the graduates the industry will require for its transformation. ii. Regulators The other key stakeholder in the banking industry’s transformative journey is the regulator. Regulatory authorities need to strike a balance between protecting consumers, establishing standards for sound regulatory and supervisory practices, safeguarding financial and monetary stability, and at the same time facilitating growth and innovation in the industry.