samchain/econo-pairs-v1 huggingface dataset:
Additionally, with this arrangement, we aim to reduce the sensitivity of the costs of holding Turkish lira required reserves against the CBRT’s policy rates and thus strengthen the automatic stabilization feature of the Reserve Option Mechanism. Distinguished Guests, As for the loans, we see that the macroprudential measures and our tight monetary stance have helped to keep the pace of loan growth at reasonable levels. The annual rate of total loan growth is 16 percent, below the 2007-2013 average of 23 percent, as of October 2014. In terms of loan trends, the annualized growth rate of consumer loans continues to hover at low levels while commercial loans remain relatively more robust (Charts 7 and 8). I would like to emphasize that this loan outlook will both restrain medium-term inflationary pressures and support the improvement of the current account balance. 4  BIS central bankers’ speeches  2. Macroeconomic developments and assumptions  Distinguished Guests, Now, I will talk about the macroeconomic outlook and our assumptions on which our forecasts are based. First, I will summarize the recent inflation developments, and then continue with the domestic and foreign demand outlook. Annual consumer inflation fell by 0.3 points quarter-on-quarter to 8.86 percent in the third quarter of 2014, while inflation excluding unprocessed food and tobacco at 8.37 percent was mostly consistent with our July Inflation Report forecasts (Charts 9 and 10). Due to adverse weather conditions and cumulative effects of exchange rate changes, food prices remained the subcategory making the greatest contribution to inflation.

Prasarn Trairatvorakul: Living with capital flows – an emerging market perspective Speech by Dr Prasarn Trairatvorakul, Governor of the Bank of Thailand, at the School of International and Public Affairs, Columbia University and School of Management, Yale University, New Haven, USA, 13–14 April 2015. *  *  *  Ladies and gentlemen, Being amongst and having the opportunity to interact with young scholars such as you is refreshing. These days I spend much of my time in meetings with senior policymakers discussing problems and challenges facing Thailand and the world economy. Many of these challenges are structural, having been accumulated over a long time. They are legacies of past steps and missteps of the generation before us. So it is fitting to be able to speak to you today, as some of you will certainly inherit and have to deal with problems that are being created now, largely inadvertently. I am reminded here of a marketing line by the Swiss watchmaker, Patek Phillipe, which goes something like “You never really own a Patek Philippe. You merely look after it for the next generation.” Let me then take this opportunity on behalf of policymakers the world over to tell you that we mean well and sorry for any troubles that we may pass onto you. The fact is that real-time policymaking is hard. Apart from serious data limitations, the world keeps changing rapidly and our knowledge often does not keep up. Today I will talk about an area where these challenges apply forcefully.
Foreign demand continued to provide a positive contribution to the aggregate demand. Nevertheless, as expected, its positive impact was lower than a year earlier. During the first five months of the year, Albanian exports increased by 23.3% y-o-y, which is lower compared with 2010. On the other hand, deterioration of trade terms and internal demand performance triggered the increase of imports in the first half of the year. Value of imports increased 14.1% y-o-y during January–May, thus, leading to higher trade deficit. Following its narrowing in 2010, this deficit expanded by approximately 8.8% y-o-y during this period. Trade deficit expansion, negative foreign currency flows in the services account and lower remittances are reflected in the expansion of the current account deficit in the first quarter, at the end of which, this deficit was at 11.8% of the GDP, illustrating the fragile position of the external sector of the economy. The performance of the four demand components led to positive, but below potential, economic growth during 2011 H1. Unutilised capacities in the economy controlled production costs and generated controlled inflation pressures. Monetary indicator analysis confirms our assessments for contained inflation pressures suggesting that money supply growth rates are moderate and in line with the economy’s demand for real money. In average terms, M3 annual growth was 11.3% in January–May triggered by a steady growth of deposits in the banking system. Demand for money is dominated by public sector demand for funding, while the private sector’s demand was more moderate.

No amount of computer capability will enable you to access the computers of the money centers of other countries, and of the off-shore center of the world. These are vast sum that we are talking about, directed at an opportune moment on markets which are not yet sophisticated, deep or varied and for political or financial reasons are at the time vulnerable somehow. In Thailand, for instance in 1997, the amount of non-resident baht moved in that year was 900 billion dollars when our total GNP was only 140 billion dollars. When that kind of money moves against a nation, there is really no way a reasonable defence could be made. Of course, the important powers of the world say that the country should behave itself better, but one has to ask a question why important powers of the world try to make sure that each country behaves itself, yet allows the international monetary system to behave totally as it wishes without due regard to responsibility or the misery and famine that such events could cost. The obvious answer is that all the major important money centers and funds are in the advanced countries and the major countries systems being much more diverse is less liable to collapse when there are large movements of funds in any particular sector. Banking in Thailand for instance provides 77% of all credit available in the country at this moment while in the US it is only 26%.
Supervisors can make several different types of mistakes, but one they cannot afford is complacency. Thank you very much for your time and patience. 4  BIS central bankers’ speeches

With limited exposure to international financial markets, Algeria has not been directly affected by the global financial turmoil. However, the sharp decline in oil prices over the second half of 2008 significantly impacted export and budget revenues. Despite this external shock, macroeconomic performance remained robust in 2009 with: –  strong external financial position with comfortable international reserves $ billion146, end September 2009 ) equivalent to 3 years imports of goods and services, and low external debt;  –  the real effective exchange rate around its equilibrium level;  –  continued high growth in the non-oil sector, expected to exceed 9% in 2009 against 6.1% in 2008;  –  sizeable savings in the stabilization fund despite the expected first budget deficit for several years;  –  contained inflation, notably on account of continued absorption by the Bank of Algeria of the excess liquidity. The strong economic performance in 2009, in line with the performance of the past several years, reflects continued prudent financial policies, sustained efforts to anchor monetary stability, and progress in strengthening the resilience of the banking sector, which have supported macroeconomic stability since 2000. 2. Savings and investment financing structure  Following a period of external financial imbalances and related adjustment programs during the nineties, Algeria has entered, since 2000, a period of sustained increase in savings, leading to a situation of excess savings over investment.
The fact that an apparently national problem has global effects to the extent that we have seen is due in this case very much to the fact that the loans have been "repackaged" into fairly technically complicated securities and sold on to investors around the world. And the unrest that has arisen has largely been concerned with the fact that it is difficult to see who is bearing the credit risks, and to what extent. These events have had several effects. There has been a more general reassessment of risk in the financial markets. The general uncertainty has led to an increase in demand for liquid and safe assets such as government securities. The interest rate on government securities has fallen, while the unwillingness to take on risk has contributed to rising interest rates on  6  BIS Review 132/2007  loans and investments between banks; interbank rates (slide 11). But all in all, it nevertheless appears as though the financial turbulence has so far not had as large repercussions on the financial markets as, for instance, the Asia crisis in 1997 and the IT crash in 2000. What effects can we expect on the Swedish economy? Perhaps the most important effect will arise in that growth in the United States will slow down when housing investments there fall and households consume less. The lower demand in the United States to some extent slows down international economic activity and there will be a slightly slower increase in Swedish exports.

And in 2006 both the number of hours worked and the number of persons employed rose quite substantially. This was partly because the number of people in employment measures increased considerably during the fourth quarter of last year. But despite the fact that fewer people are in labour market programmes this year, the number of employed has continued to increase. This indicates considerable strength in the labour market. We also assess that employment will continue to increase during the forecast period, but at a slower rate. The fact that the pace slows down is due to the economic upturn slackening. It is also due to higher wage increases contributing to a lower demand for labour. The supply of labour has also increased, but not as much as employment. Open unemployment has thus fallen (slide 7). According to our forecast, the labour supply will continue to increase, albeit at a slower rate, during the forecast period. This development is mainly due to the economic cycle, but also to some of the Government’s measures. The fact that the rate of increase is slowing down is due to the economic upturn slackening, and also to factors such as the number of persons in the age groups with high participation in the labour force declining. All in all, this will lead to the number of open unemployed persons continuing to fall, but at an ever slower rate. Compared with what we were expecting in June, the conditions in the labour market have become tighter.
Documented studies have shown how simply introducing an affordable, safe and accessible avenue for savings resulted in increased spending towards healthcare, education and nutrition. It has empowered women with more decision-making power and enabled children to spend more on school supplies that ultimately led to better test scores. Insurance has also been shown to play an important role in encouraging micro enterprises and low income households to make productive investments without the fear of natural disasters or medical emergencies wiping away their hard-earned assets and savings. By providing opportunities and the foundational knowledge to low income individuals and entrepreneurs to gain access to credit, increase savings and manage their exposures, this would greatly improve the probability of success in business and enhance socioeconomic mobility. This in turn will bring many important benefits to society. These benefits might be difficult to quantify but are obvious and far reaching. This is illustrated in the story of a Malaysian micro-entrepreneur who spent 10 years selling raisins and dates from street corners in and around Kuala Lumpur. He travelled daily to and from night markets and mosques on his motorcycle; his fortunes often at the mercy of unpredictable weather. But opportunity beckoned when a micro loan was obtained in 2011, which enabled him to rent a permanent physical space and invest in a basic logistics system to stock and deliver goods to customers. With the continued support of his bank, business grew, three more stores were opened and sales increased fivefold.

The Chilean economy was closed to international trade and capital flows, interest rates were regulated, credit was restricted, and banking activity was largely controlled by the State. In the second half of the 1970s the banking sector was privatized and liberalized. However, this was not accompanied by adequate regulation and supervision; and a relatively small financial system built major vulnerabilities. When macro policy missteps and external shocks hit in 1982, the banking sector was not just a weak link, but amplified them into the deepest economic and financial crisis in a generation. The Chilean financial crisis of the 1980s and the origins of the subordinated debt Financial crises are abrupt, costly and protracted affairs, and the Chilean financial crisis of the early eighties was no exception. This crisis is often quoted as one of the top 25 most severe financial crises in modern history. In 1981, annual output growth went from positive 9% in the first quarter,   I thank the comments and suggestions in preparing this speech to Solange Berstein and Mauricio Calani. Page 1 of 5  Central Bank of Chile March 2019  to 0% in the fourth quarter, and to minus 14% in 1982. That same year, unemployment reached a record of 25%, and businesses all over the country were seriously hampered, ultimately affecting their payment compliance. Banking profitability went quickly to negative territory and the delinquency rate quadrupled to 15% of the total portfolio, putting several banks solvency and operations at risk.
The results also indicate that a low equity ratio in the banking sector can be an early warning of future instability. While indicators and empirical models can provide support in the assessment of financial imbalances, they can of course only go so far. Their ability to produce a precise estimate of systemic risk is limited. No two financial crises are alike, and the financial system is constantly evolving. In addition, the assessment of systemic risk must include an analysis of the consequence of a crisis. Assessments of systemic risk are therefore always based on judgement. The primary aim of the countercyclical capital buffer is to make banks more robust. The buffer may to some extent also dampen the build-up of financial imbalances. However, its impact on markets will depend on how banks increase capital ratios. Roughly speaking, banks have two options at their disposal: they can 1) increase equity capital or 2) reduce risk-weighted assets. Chart: Increased capital requirements in Norway Over the past few years, in order to meet the new requirements, the six largest Norwegian banks taken together have almost doubled their capital adequacy ratio, measured by Common Equity Tier 1 capital. This is primarily the result of a significant increase in capital. 4 Retained earnings contributed the most, and banks widened their lending spreads in 2013. Equity issues have been of minor importance. The second option I mentioned involves improving capital ratios by reducing risk-weighted assets.

Current accounting and tax frameworks hamper the widespread adoption of dynamic provisioning by requiring that risks on specific loans be identified prior to provisioning. Discussions among accounting standard-setters, tax authorities and regulators are essential to encourage such a reform. •  Globalisation and the development of financial markets have created a real need for reliable information and harmonised accounting practices. We fully support such trends towards increased transparency. But, it is nonetheless vital to ensure that, when applied to banks, some of the new widespread accounting practices neither distort the presentation of banks' individual situations, nor disrupt their management practices. A “full fair value” approach assumes that a “fair value” can be determined for all financial instruments; but this does not necessarily apply to banking activities, since loans and deposits are essentially neither liquid nor tradable. Using the full fair value approach for the banking book might result in sharp swings in banks' earnings and prompt banks to curtail their lending activity. This approach might further amplify the credit cycle and could potentially affect financial stability. This is the reason why an increasing number of bank regulators are not in favour of this approach as regards banking book. Let us now focus on asset prices moves. Financial authorities might reflect on some ways to foster behavioural diversity in financial markets. As we have seen before, a series of factors, such as short-termism, mimetic behaviour or index management, have tended to make “contrarians” less pro-active on financial markets.
This Law is a fundamental step for ensuring that all credit institutions are managed independently and professionally so that the governance problems which contributed to destabilising part of our financial system are diffused once and for all. In practical terms, this year should see the completion of the transformation of virtually all of the savings banks – those still existing as such – into ordinary foundations or bank foundations. For this purpose, and as it is legally conferred to do, the Banco de España is drafting a Circular. This Circular will regulate the core aspects of the functioning of bank foundations in order to safeguard the healthy and prudent exercise of the dividend and voting rights corresponding to them as the shareholders of credit institutions, thereby ensuring the professional management of such credit institutions. The Circular will specify aspects such as: (i) the content of the protocol governing bank foundations’ management of their ownership interest in the credit institution; (ii) the financial plan, which will envisage how they must meet the possible capital needs of the institution in which they have an ownership interest; and (iii) the requirements which the reserve fund must fulfil as regards its funding, target volume and possible uses; all the foregoing in cases where, given the percentage of ownership they hold in the credit institutions, these requirements must be met.

Similarly, the Circular will determine the circumstances in which bank foundations will be compelled to diversify their investments and, if appropriate, to relinquish control of the credit institutions which they own through the corresponding divestment. I trust that the period for public consultation of the Circular will open shortly. Second, the new European framework of resolution is already prompting, in most national jurisdictions, reflection on the institutional architecture of bank resolution. In the past, resolution agreements have required close collaboration between the various authorities involved in the process; namely, the supervisor, the resolution authority, if any, and the governments concerned insofar as the resolution has habitually required the use of substantial public funds. The experience in our country has been no exception. The current distribution of functions between the Banco de España and the FROB – whose Governing Committee includes representatives of the Ministry of Economic Affairs and Competitiveness, the Ministry of Financial Affairs and Public Administration, and the Banco de España – has required that the two institutions were intensely involved in the resolution processes. Thus, while the supervisor is responsible for initiating the resolution process of an institution and approving the resolution plans, the FROB must prepare these plans, put them into practice and, in sum, manage the State’s ownership interest in those institutions that received financial aid, including any future divestment. Consequently, the coordination between the Banco de España and the FROB has been pivotal in ensuring effective management of the crisis.
History demonstrates that shifts in the quantity of money have often been driven – or at least accompanied – by shifts in the demand for deposits (i.e. what the private sector would like to hold for a given level of spending). Following the financial liberalisation earlier that decade, banks began during the 1980s to pay interest on standard deposit accounts. This increased their attractiveness, relative to other “stores of wealth” – they were not the precursor to higher spending and inflation – and broad growth remained stubbornly high even as inflation declined sharply (at least until the boom at the end of the decade). For similar reasons broad money growth was extremely strong throughout the first fifteen years of inflation targeting (1992-2007). Nor is there a tight correspondence between “narrow” and “broad” money. QE involves the creation of central bank reserves to buy financial assets (usually government debt). So in the decade or so that passed between the first use of the policy in 2009 and the onset of the pandemic, reserves grew extremely rapidly. Yet broad money growth was significantly slower than it had been before the crisis (Chart 1). And, in both periods, average inflation was close to 2% (Chart 2). Page 4  Chart 1: Reserve creation neither necessary nor sufficient for strong growth of broad money  Sources: ONS, Bank of England and Bank calculations. Unless stated otherwise “broad money” refers to M4 excluding intermediate other financial corporations (M4ex).

The Federal Reserve is also standing up programs to support the flow of credit to households, businesses, and state and local governments, so that they can weather this storm and continue to do their work, both now and when normal life resumes.7 Last week, we announced more details on these programs, which altogether provide additional funding of up to $ trillion.8 These programs are executed with the full support of the Treasury. We are also deeply committed to providing transparency around matters such as usage, eligibility, governance, vendor selection, and fees for these programs. The actions by the Federal Reserve, while sharing some similarities with those undertaken during the financial crisis, are specifically designed to deal with the unique economic challenges posed by the coronavirus. Our efforts supporting the provision of credit include a number of programs aimed at different 2/4  BIS central bankers' speeches  parts of the economy and work through different channels. One set of programs supports the availability of credit to businesses—importantly, including small and medium-sized businesses— through loans, commercial paper, and corporate bonds. The second set of programs targets the availability of credit to states and municipalities. But we cannot act alone: fiscal policy is also playing a critically important role. In particular, it can do what monetary policy cannot: provide for the public health response and transfer income to those most affected by the outbreak.