samchain/econo-pairs-v1 huggingface dataset:
With more risk traded in and through markets, the potential knock-on effects from an erosion of liquidity in some segments or for some institutions have multiplied, and we are currently experiencing how unexpected this process can be. Risks have become “mobile”, if I may put it like that, so mobile that we lose sight of their true location. The third and final set of issues relates to global imbalances. The facilitation of crossborder capital flows may have relaxed financing constraints for borrowers, making it possible to finance ever larger current account deficits. In one sense, the contribution of financial globalisation to disconnecting national savings and national investment is a welcome development, to the extent that it allows for a more efficient global allocation of savings. However the differences in the development of financial markets around the world may also have created, or at least facilitated, global imbalances. The ability of countries to produce sound and liquid financial assets is largely disconnected from their level of economic growth : rising revenues in the emerging world need to “find a home” in sound and liquid financial markets. Finally, in any case, the question of sustainability – the resilience of capital flows to the accumulation of imbalances – remains a pressing one. While capital flows tend to move freely across borders, exchange rate regimes remain very diverse in their degrees of flexibility. This leads to asymmetric adjustments depending on the exchange rate regime, not only between currency areas, but also inside the same region, such as in Asia.

With the rapid changes in society, technology and economy, we need to remain flexible, constantly iterating financial education approaches to adapt to what works best in the given context. This is where fresh ideas are welcomed, like those being featured and celebrated today. On this, I would specifically acknowledge and congratulate the three winners of the Best Paper Awards today. I understand that the winners and other shortlisted papers will be given the opportunity to publish their research in a renowned academic journal or an edited publication. I trust that their exemplary work will inspire many others to contribute to this area of research. In closing, I am hopeful that all of us here today can be increasingly effective in our shared aim to promote financial literacy in Malaysia. Today's event is a step in that direction. Let us take this opportunity to learn from one another and reimagine new paths forward – helping Malaysians regain financial resilience and improve their financial well-being. Thank you. 3/3  BIS - Central bankers' speeches
The most obvious example of the separation is precisely the one which occurred on 9 August 2007, when amid market tensions, it was decided both to maintain the rates unchanged and to intervene on a substantial scale to satisfy the banks’ demand for liquidity, with a € billion operation. And the same separation has been continued in all the months since then. That the decision to reduce interest rates in March to 1.5% was justified is, I believe, evident from the growth and inflation estimates published at that time. I remember the ECB staff projections were pointing to euro area GDP growth for 2009 and 2010 being equal to -2.7% and 0.0% and inflation of 0.5% and 1.1% respectively. Also taking into account the relevant horizon for monetary policy, between one and two years ahead, an interest rate of 2%  2  “Three questions on monetary policy easing”, University of Ancona, 6 March 2009 (available at www.ecb.europa.eu). BIS Review 82/2009  3  seemed excessive, also considering the downside risks to growth that the ECB’s Governing Council had signalled and that they duly manifested themselves. Indeed, the projections were again revised in early June, and the cut in the official interest rate to 1% decided in May is consistent with that revision. The objective of the decisions to supply liquidity to the banking system was not to “rescue the banks” but to ensure the continued functioning of the financial market, starting with its base, i.e. the money market.

It is a natural consequence of the Riksbank being in earnest about its task of ensuring a rate of price and wage increases that is in line with the inflation target in a situation where economic activity in Sweden is become gradually stronger. Here I am prompted to refer to what Knut Wicksell, the well-known political economist, pointed out in his day; it is a matter of looking for the “natural” rate of interest at which the economy can expand without prices and wages rising too quickly. 4  BIS Review 19/2002
Prior to the outbreak of the crisis at the end of 2006, the balance sheet total was just over CHF 100 billion. Today, it amounts to nearly CHF 500 billion. In the area of financial stability, the SNB, too, was entrusted with some new tasks, especially with regard to macroprudential measures. The countercyclical capital buffer as well as the designation of systemically important banks and their functions are probably the most well-known of these measures. On the whole, central banks around the world have thus far been successful in their role as firefighters. They managed to prevent the global economy from falling into a depression and to ensure price stability. In addition, in many countries, they worked side by side with their governments to shore up the banking system. This has bought some time – time that in numerous places should be used to solve the underlying problems. In many countries,  BIS central bankers’ speeches  1  measures that should be undertaken to achieve this include well-designed structural reforms of the economy and comprehensive restructuring of government finances. The downside of the central banks’ success is that it could give the impression that treating the root of the structural problems is not necessary at all.

Yet the concerns which used to be expressed about preventive approaches are not entirely without foundation. It is not usually possible for central banks to fully measure the build-up of excesses on financial and asset markets in real time, to intervene at exactly the right time and thus put a stop to dangerous bubble formations at precisely the right moment. However, the current macroprudential toolkit neither claims nor intends to do this. Just as monetary policy is unsuited to fine-tuning the economy, macroprudential measures are also little suited  6  BIS central bankers’ speeches  to fine-tuning asset and credit markets. Instead, what is involved are relatively limited interventions in order to prevent foreseeable larger imbalances that might possibly endanger financial stability at a later stage. While there is broad international consensus that the new instruments make sense, there is a wide difference of opinion about how the institutions that use them should be organised. In some cases, new bodies have been created to examine the use of these instruments, while in other cases responsibility has been placed fully in the hands of the central bank. A number of countries have gone even further by handing over the traditional area of individual banking supervision to central banks as well. Similarly, it is equally impossible to use a one-size-fitsall approach for all the measures and instruments introduced in different countries.
This Exchange Rate Mechanism (ERM) functioned well for a decade or so but it ultimately fell apart due to the divergences in the economic and fiscal policies of the participating countries. Speculative attacks ensued and ultimately triggered a crisis that forced two large countries – the United Kingdom and Italy – to leave the ERM in 1992. 2  BIS central bankers’ speeches  Parliament), and judiciary (the EU Court of Justice). The creation of the single currency is an act of further political integration. Under the Maastricht Treaty the European Economic Community became the European Union, a proper reflection of the fact that the ultimate aim – the finalité, as we say in French – of the European project is more than just economic. The EU is a real, albeit limited, political union. 2. The Maastricht framework and its shortcomings  Let me now review briefly what I consider to be the three most important shortcomings of the Maastricht framework – the ones on which we need to achieve progress urgently: i) stronger fiscal institutions; ii) real convergence across the euro area; and iii) the establishment of a financial market union. The Maastricht Treaty created the European Central Bank (ECB), which took up its monetary operations on 1 January 1999. The monetary dimension of the Maastricht Treaty has worked very well. Since the start of EMU, the ECB has kept annual inflation rates on average very close to 2%. As regards economic policies however, no new institutions or competences were created.

Importantly, the ECB has also decided to resort to outright purchases of bonds on secondary markets. Following the so-called Securities Market Programme, which has now been terminated, the Governing Council of the ECB agreed at its meeting on 6 September on the  4  BIS central bankers’ speeches  modalities for undertaking Outright Monetary Transactions (OMTs) in secondary markets for sovereign bonds in the euro area. The OMTs will enable the ECB to address severe distortions in government bond markets which originate from, in particular, fears on the part of investors of the reversibility of the euro. Monetary union is sometimes misunderstood as an exchange rate system which the participating countries can enter and leave, as was the case with the ERM. Such a perception of reversibility would imply that, ultimately, one euro would not be worth the same in different euro area countries. In other words, the single currency would no longer be single. This perception is fundamentally flawed. Let me be very clear: the Maastricht Treaty refers to the “irrevocable fixing of exchange rates” when a country enters monetary union. The euro is irrevocable. With the OMTs, under appropriate conditions, EMU will now have a fully effective backstop to avoid destructive scenarios with potentially severe consequences for price stability in the euro area. A necessary condition for the OMTs is that the country concerned adheres to strict and effective conditionality attached to an appropriate programme under the European Financial Stability Facility (EFSF) and the European Stability Mechanism (ESM).
With increased globalisation of the world  4  BIS central bankers’ speeches  economy, there is no doubt that Zambia stands to benefit from the rating assigned on condition that the country adopts appropriate policies that are supportive to sustainable economic growth environment. RECENT DEVELOPMENTS IN MINING AND MANUFACTURING (MFEZ) A. Mining    Growth in the Zambian mining and quarrying sector has continued to be strong since privatisation. In 2010, the growth in the sector was 15.2% (20.2% in 2009), thus contributing strongly to the 7.6% real GDP growth in 2010.   Growth in metal mining was 16.0% with copper and cobalt output increasing by 17.4% and 49.4% to 819,159.19 mt and 8,781 mt, respectively.   During the first half of 2011, total copper output at 414,984.5 mt, was 4.0% higher than 399,062.0 mt produced during the corresponding period of 2010. Similarly, cobalt output was 4,352.7 mt, 8.5% higher than 4,012.8 mt produced in the first half of 2010.   This outturn was largely explained by the increase in the scale of production by the mines coupled with the rebound in copper prices, following the relative recovery in the global economy. B. Manufacturing    Performance of the manufacturing sector in 2010 and the first half of 2011 have been favourable with a 4.1% growth in 2010 (2.2% in 2009). Growth has largely been driven by agro-processing (food & beverages), including production of nonmetallic mineral and fabricated metal goods, chemicals, explosives and construction materials (such as cement).

Prasarn Trairatvorakul: Policy Forum marking the Bank of Thailand’s 70th anniversary Welcome remarks by Dr Prasarn Trairatvorakul, Governor of the Bank of Thailand, to the Bank of Thailand’s 70th Anniversary and 3rd Policy Forum, Bangkok, 12 December 2012. *  *  *  Governor Glenn Stevens, Distinguished Guests, Ladies and Gentlemen, 1. It gives me great pleasure to extend a warm welcome to all of you, our distinguished guests, to the Bank of Thailand’s Policy Forum. Today’s gathering marks the third such event organized by the Bank of Thailand. The policy forum serves as a platform for prominent academics, policy-makers and market participants to learn from the visions and insights of outstanding international leaders. More importantly, the discussion and knowledge-sharing arisen from this forum will further equip the Bank of Thailand with a broader and deeper pool of knowledge to pursue its mandate. On that note, let me add that this year marks the 70th anniversary of the Bank of Thailand, an institution that has always been committed to preserving economic and financial stability. This commitment would not be possible without continual upgrading of our knowledge base through forums such as the one today. 2. Today, the Bank of Thailand is truly honored to have Governor Glenn Stevens of the Reserve Bank of Australia with us to share his thoughts on “Challenges for Central Banking”. This talk is especially timely because the effects of the global crisis are spreading to our region.
In general, and certainly if someone’s performance can be easily verified, it helps to offer incentives of this sort1. But if over-simplified targets sufficiently distort an employee’s incentives, because they ignore the less verifiable aspects of a job, it can be better simply to pay a flat wage2. The same analysis can also be used to think about how multiple tasks should be allocated in the first place. In some cases the various aspects of a job are inextricably linked – they can only be done by one person. Those broader parts of a child’s education have to be provided by the same institution – a school – that teaches what’s needed to pass exams. But in other cases the allocation may be a matter of choice. When it is, it turns out that it makes sense – all else equal – to group the more visible objectives together, in one job, and the less verifiable tasks in another. This limits the risk that one dominates the other. I think this insight has some bearing on how central banks, whose responsibilities have been expanded since the crisis, should be organised. Specifically, it’s relevant when deciding whether the newly created “macroprudential” policies should be conducted separately or jointly with monetary policy. Some have argued that, because there are significant interactions between the two, monetary and macroprudential policy should be housed not just in the same institution, but in the same policymaking committee within the central bank. The distinct MPC and FPC should become a single “FMPC”.

This probably reflects the strong competition that Norwegian producers of consumer goods encounter from international operators. At the same time, domestic demand is being stimulated by low interest rates, and in some industries capacity utilisation is providing a basis for higher margins. Service prices, which showed little rise last year, have increased again this year. In many industries, including the airline industry, where price competition is strong, low profitability has led to an increase in prices. High oil prices have also resulted in increased prices, for example for transport services. On the basis of the pay increases agreed upon in this year’s wage settlement, combined with the estimates for wage drift and wage carry-over, annual wage growth is projected at around 3½ per cent this year. This is somewhat lower than the average for the past ten years. The relatively low level of inflation implies, however, that real wage growth is in line with the average for the past ten years. Prices for imported consumer goods are still falling from the level prevailing one year earlier. Sharply rising production capacity in the world economy as a result of high investment levels in many low-cost countries has led to subdued price increases for many internationally traded goods. The dismantling of trade barriers has also boosted imports of consumer goods from countries with low cost levels. For example, clothing imports from these areas have increased markedly in the past few years. This has contributed to a significant fall in clothing prices.
An important question here is how well equipped the Swedish society is to take advantage of this type of development and to deal with the problems that arise from accelerated structural transformation. In order to reap the full benefits of the growth made possible by technology, we will probably need further deregulation and changes to institutional rules. Those aspects which have so far dominated the discussion are higher labour productivity as a result of the new technology and the attendant effects of this, in the form of sharper competition, which is expected to result in further improvements in productivity and in restrained price development. If these hopes were fulfilled, it would be a very positive development. A more rapid productivity development in a society is a crucial factor for creating a high standard of living. If we had had the same productivity development during the period 1974 to 1993 as during the past 5 years, our income level could have been approximately 10% higher. Expressed in a different way, the general discussion so far has been dominated by the possibility that the supply in the economy has increased. But, if households raise their expectations with regard to their lifetime incomes, consumption may in the short term be adjusted upwards more than domestic production allows. With regard to deregulation, the analyses are similar. They lead to a downward shift in price levels via increased competition. But here it is a question of nonrecurring effects and should not be interpreted as lasting lower inflation.

Unemployment has fallen and is continuing to fall to levels that few believed possible only a few years ago. Productivity in Sweden has developed strongly. Between 1974 and 1993, for instance, labour productivity increased by no more than 1.5% a year on average, while the corresponding figure from 1994 onwards lies at around 2%. This appears to be due to companies succeeding in utilising existing labour and equipment more efficiently. What we know and what we believe This is at any rate the picture presented by Statistics Sweden. Now, we perhaps should not take it as a matter of course. Reality is not always so easy to capture in quantitative terms. One particular problem related to information technology is that it probably affects service production just as much as purely  BIS Review 93/2000  2  industrial production. Service production is something of a black sheep in the economic statistics. There are often tremendous difficulties in distinguishing quality changes from price changes in this field, which leads to the statistics being less reliable. Although a lot of effort has been put into the work on calculating GDP and other measures of economic developments in Sweden, we should be aware of the uncertainty inherent in these estimates. This is also an important reason why a commission of enquiry was recently appointed to look into economic statistics in Sweden.
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.

Second, even if commodity price pressures were to prove persistent, they have a smaller impact in the United States than they do in many other countries. Relative to most other major economies, the U.S. inflation rate is lower, the amount of slack much greater and commodities represent a relatively small share of our consumption basket. This small share helps to explain why the “pass-through” of commodity prices into core measures of inflation has been very low in the United States for several decades. Third, the Federal Reserve’s success in anchoring inflation expectations has also been important in limiting pass-through. Since 1984, for example, when the Federal Reserve began to achieve success in driving down and then subsequently anchoring long-term inflation expectations, there has been very little evidence of commodity price pass-through into core inflation. In contrast, prior to 1984, when inflation expectations were much less wellanchored, pass-through did occur and, at times, played an important role in pushing underlying inflation higher. Thus, while rising commodity prices may be giving some of you a bad headache, they are not likely to lead to a sustained rise in inflation to levels inconsistent with our dual mandate. We will have to ensure, however, that these pressures do not cause inflation expectations to become unanchored.