samchain/econo-pairs-v1 huggingface dataset:
Without losing sight of the interest this seminar has in the challenge the new technologies pose, I would like to focus today on another major challenge that is not exclusive to the banking industry but applicable to everybody: financial education. Allow me first to set out, non-exhaustively, some of the results drawn from the Survey of Financial Competences presented by the Banco de España and the CNMV last month. I shall then refer to how important it is to continue dedicating efforts to financial education, especially in the current context of financial innovation. The Survey of Financial Competences The Survey of Financial Competences, which is included in the National Statistics Plan, adapts for Spain a questionnaire devised by the International Network for Financial Education, coordinated by the OECD. The aim is to measure, in an internationally comparable way, the financial competences of the population aged 18 to 79. The Survey measures these competences from different perspectives, and obtains information on: (i) financial literacy; and (ii) knowledge, holding, acquisition and use of financial products. To measure financial literacy, the Survey poses questions on three basic financial concepts: i) inflation; ii) compound interest rates; and iii) risk diversification.

Among cryptoassets are what are generally known as cryptocurrencies, conceived for use as a means of payment, and those known as digital tokens, conceived for obtaining financing and which confer on the purchaser the right to receive remuneration, or to exercise certain rights. The Bitcoin is an example of the former. The so-called ICOs (Initial Coin Offerings) are an application of the latter. Both have been the subject of growing interest, and there are at present numerous and highly heterogeneous initiatives. While their impact so far on global financial stability is considered to be limited, they pose a series of risks, in areas such as consumer protection and the prevention of moneylaundering and the financing of terrorism, which the authorities monitor closely and on which they have issued warnings and statements. In this connection, it should be stressed that these are assets of a marked speculative nature, without the backing of supervisors and susceptible to fraud or price manipulation. They cannot be considered as money or as deposits, and they do not enjoy the protection of the regulations governing banking and investment products. It is worrying that, in a setting in which less than half the population understands the concept of compound interest rates, there is such demand for complex assets with these characteristics. Lastly, I wish to refer to the risk of authorising – owing to a lack of knowledge or of due care – access to personal information that would preferably have been kept private.
But whereas measures of credit and leverage may together serve as useful portmanteau guides to latent risks in the financial system, a considerable degree of discretion is likely to be called for. So a rigid linkage of macroprudential instruments to such indicator variables seems inappropriate. In the monetary policy sphere, we have the luxury of precisely defined measure of inflation against which the rationale for policy choices can be made. Unfortunately, we presently lack a similarly precise characterisation of the financial stability objective, so effective communication will be even more important than in the monetary sphere. Tonight I have offered you six lessons that I have taken from the crisis, though they are certainly not intended to comprise an exhaustive list. Moreover, some of us had more to learn than others. Here in Australia you have had a relatively “good” crisis – if that is not an oxymoron – in part because robust prudential supervision, coupled with enlightened monetary policy, helped to ensure that the banking system was in a better position to withstand the crisis than back in my own country. There the government has initiated reforms that seek to embed some of the lessons into the institutional framework. These include returning prudential supervision to the central bank and the creation of a Financial Policy Committee charged with protecting and enhancing the resilience of the UK financial system. We had our first meeting last month, issuing half a dozen recommendations to our banking supervisor and to our banks.

Bearing all this in mind, it is probably surprising how modest a deviation was actually shown from the forecasts for inflation and the current account deficit. So far, house prices have been the main driver of inflation above the target. If house prices alone are excluded, Iceland’s rate of inflation is low – and also in comparison with other European countries, for example. House price inflation was widely expected to stop sooner than it actually did. Monetary Bulletin, which was published yesterday, describes how the financial position of households has tightened due to a rise in short-term interest rates and in the lowest rates for new mortgages, compounded by the depreciation of the króna and higher inflation. For a number of familiar reasons, however, these monetary effects are not felt strongly yet, which is dampening efforts to slow down the economy. The increase in mortgage interest rates following yesterday’s rise in the Central Bank’s policy rate, however, represents an important contribution now. Private consumption grew by almost 12% last year. Growth at such a pace is rare and can only be short-lived. Disposable income has been driven up by wage rises, a higher employment rate and tax cuts. Household wealth has also grown as real estate and equity prices rose substantially. Most indications are that asset prices are the main driver of private consumption growth. Housing prices in the Greater Reykjavík Area went up by 45% over the past year and a half, and equity prices by almost 96% over the same period.
At the same time, the value of the Norwegian krone against the German mark was almost halved, which contributed to high imported inflation. During this period, monetary policy was not oriented towards stabilising inflation. In order to achieve price stability, monetary policy must provide the economy with a nominal anchor. From the mid-1980s, it was recognised that a substantial revision of economic policy was necessary and that the problems created by inflation had to be taken seriously. From 1986 to 1992, Norway operated a fixed exchange rate regime. At that time, the fixed exchange rate was the anchor for inflation in Norway. The difference between inflation in Norway and Germany narrowed substantially. Deteriorating competitiveness as a result of high wage growth would no longer be remedied by means of devaluations. Instead, imbalances in the labour market would be addressed by means of countercyclical policy. Substantial emphasis was placed on the importance of wage formation for employment. Only when wage growth dropped below the level of our trading partners did unemployment begin to fall and the manufacturing sector began to pick up. The fixed exchange rate policy was not introduced in order to strengthen the internationally exposed business sector. On the contrary, it was a departure from the approach where monetary policy and frequent devaluations had been used to shelter these sectors. The fixed exchange rate was an intermediate target for achieving low and stable inflation.

Exchange rate adjustments in the face of large capital inflows, however, are not without costs. An excessively rapid appreciation of the currency could be disruptive to the real economy, since there often are constraints in the adjustments of the real economy, from labor market frictions to pricing behaviors. Here we have a challenge and need to balance well. In general, we would allow the currency to appreciate to the extent that the movements are broadly consistent with the economic fundamentals and that they would not cause undue disruptions in the real sector. Let me note here that I think the Thai economy, over the years, has become more capable in coping with exchange rate movements. We see more risk protection via financial market instruments on the part of the private sector. Exporters, in particular, have been able to diversify in terms of product lines and market destinations. Nevertheless, from time to time there is still a need to dampen the pressures on the exchange rate, and central banks often resort to exchange rate intervention. While such intervention could help contain excess exchange rate volatility, its focus is at the end of the process. In other word, FX intervention is a “passive” mechanism in dealing with capital inflows. By the time of intervention, capital would have already flowed into the economy. Imbalances could have already built up.
Michael Bonello: The challenge of the Euro Speech by Mr Michael C Bonello, Governor of the Central Bank of Malta, at the Second International Summit organised by The Economist/Caja Madrid, Madrid, 8 July 2002. *  *  *  It is a pleasure and an honour to be in Madrid today to participate in this discussion on challenges related to the adoption of the euro and to share a platform with such distinguished speakers. Since I have been invited to present the perspective of a small candidate country, I propose to start by briefly recalling some key facts about Malta and its economy. Malta is a micro-state, with a population of nearly 400,000 living in an area of just over 300 km2. In 2001 nominal GDP amounted to € billion, or less than 0.1% of that of the euro area. This translates into a level of income per capita estimated at around half the European Union (EU) average. Market services, including tourism and finance, account for nearly two-fifths of GDP, while manufacturing contributes almost a quarter. Given its size and lack of natural resources, it is not surprising that Malta has one of the most open economies in the world, with imports and exports combined amounting to nearly double GDP. The EU is Malta’s main trading partner, accounting for two-fifths of its exports and nearly two-thirds of its imports during 2001. It is an even more important market for the tourist industry and is a major source of capital inflows.

The Central Bank is aware that it will have to maintain the peg and manage a smooth transition to membership of the ERM and the single currency area in a rapidly changing economic environment. This will not be easy, but we should be able to rely on the well-established institutional and policy framework of the acquis and anchor our strategy to a clear end-point, the adoption of the euro. We, therefore, believe this to be a credible approach to euro area membership. In conducting monetary policy during this period, we recognize that international capital movements may present a growing challenge. For a long time, Malta’s exchange rate peg was backed by controls on inward and outward capital flows but these are now being gradually phased out. In theory, full capital account liberalisation may lead to large and volatile capital flows which, in turn, may put pressure on the peg. In practice, econometric evidence suggests that, because of its openness, the Maltese economy has already been exposed to significant capital flows. This, together with recent experience with a partially liberalised capital account, suggests that the impact of full liberalisation may turn out to be less than might have otherwise been the case. It is clear, nevertheless, that the Central Bank will have to adjust short-term interest rates – its key policy tool – to neutralise any pressures on the exchange rate. In other words, interest rates will not be able to respond to domestic economic developments, but will have to move in line with those abroad.
A value above (below) 50 denotes optimism (pessimism). . (2) Business Perceptions Survey (EPN). (3) Monthly Business Confidence Index (IMCE) Sources: Central Bank of Chile and UAI/ICARE. Figure 10  Current account (percent)  Percent of GDP of last 12 months  Percent of quarterly GDP  2 0 -2 -4 -6 -8 -10 -12 -14 18  19  20  21  Source: Central Bank of Chile. 13  22  23  Figure 11  World inflation  (annual change, percent)  United States Headline 12 9 6 3 0 -3 10 12 14 16  Eurozone 12 9 6 3 0 -3 10 12  Core  18  20  22  United Kingdom  10  12  14  14  16  Core  18  20  22  Latin America (*)  Headline  12 9 6 3 0 -3  Headline  16  Core  18  20  Headline  12 9 6 3 0 -3  22  10  12  14  16  Core  18  20  22  (*) Simple average of inflations in Brazil, Colombia, Mexico and Peru. Source: Bloomberg. Figure 12  Monetary policy rates in developed economies (*) (percent)  6  Eurozone  United States  5 4 3 2 1 0 -1 19  20  21  22  23  (*) Diamonds represent monetary policy rates implicit in financial asset prices at the end of 2023 in respective economies.

Normalized 7  consumption, lower inflation and restored real household income will enable us to make progress in their recovery, over and above other efforts that may be made to strengthen them. This is another good reason why we must continue firmly in the process of inflationary convergence. It is vital not only for improving the welfare of households, but also to give them the tools to face the difficult times that the future might bring. There are many other challenges, of course, about which this Congress has constantly shown its concern. On one side, that of fostering greater investment and growth, which are also vehicles for improving well-being through employment and household income. On our side, we reiterate that monetary policy has done and will continue to do everything in its power: by reducing the volatility of the cycle and fostering a macroeconomic environment conducive to economic development. At the same time, the country must also address some very pressing issues. How to improve our productivity, how to face the challenges of a world in constant change and, particularly, how to overcome the impact that the pandemic had on such significant aspects as education. Dear Senators, the Central Bank has maintained a monetary policy that has played an important role in the process of resolving macroeconomic imbalances, helping inflation to decrease and move towards the 3% target. If this path is maintained, we will soon begin to reduce the Monetary Policy Rate. However, this task is not over.
It means, the foreign savings is necessary, and part of it will pour through the foreign direct investments, while part through debiting. Of course, speaking from the viewpoint of the monetary policy, we would like to see the state to borrow also from abroad, not only on the domestic market, because it gives additional security and stabilization to the Macedonian economy. The level of debt is still moderate and causes no other unfavorable implications. So, whether like it or not, we must borrow, better abroad, in order to, if not else, cover also the current expenditures? Well, the state budget is structured in such a manner that it has a deficit, meaning a need of funding, but whether that funding is used for current or capital needs, it is hard to say, because it is one account of the Government from which all those needs are covered. If a problem regarding the repayment emerges, hypothetically, does it mean that the monetary policy can feel the consequences as well? The fiscal and the monetary policy are, of course, interleaving and the monetary policy is always adjusted in order to maintain the balance in the Macedonian economy. If we come to a situation when this balance is disturbed, the monetary policy will adequately react in order to restore the balance. The foreign reserves for a month "melted" by approximately Euro 80 million. Has these reserves been spent for maintaining the stability of the Denar, or for other purposes?

This one does not need to end – not because we are due Basel IV, or another raft of reforms, but because we will continually adjust as the industry itself innovates. Adjustments will be based on improved engagement with the industry about what’s necessary and conversations with a much wider range of people. Buried in your iPads, under the financial regulation section, is a list of all the current work streams of the FPC, FSB, BCBS, EC, CMU, et cetera – it’s all in there. Of course, there are very few people who know what all those acronyms are and what they mean – and shame on them if they do! This reinforces the point about comprehension, one of the most important takeaways from today. As Jon Cunliffe noted just a short while ago, rather than burying people in acronyms, the responsibility of the official sector is to explain what’s going on, why certain things are being done, and what else is necessary. In other words, as a senior banker once told me early on in my career in the private sector, “If it doesn’t make sense, it doesn’t make sense”. I asked him to repeat it because it didn’t make sense to me at first. If someone in finance explains something and it doesn’t make sense, and if when they repeat it still doesn’t make sense, it’s very likely that they don’t understand it themselves, which is quite often the case, or that, actually, it doesn’t add up.
And yet, if you ask ten economists what precisely macroprudential policy is, you’re likely to get ten different answers. 1  So the time has come to take stock. I want to lay out what I believe to be five guiding principles for macroprudential policy. My aim in doing so is twofold: first, to help to build a common understanding of what it is and how it works; and second, to engage the finest minds – you – in partnership to push the frontiers of knowledge in ways that can make it better. 1) “It’s the real economy, stupid”  2  The first of my five principles is the one that motivates the whole exercise of macroprudential policy. For all that macroprudential policy may seem to be about regulating finance and the financial system, its ultimate objective – borrowing from James Carville’s famous election campaign advice – is: the real economy, stupid. 3  It is captured more precisely by Eric Rosengren (President of the Federal Reserve Bank of Boston) as avoiding circumstances in which “problems (or concerns about potential problems) within institutions, markets, payments systems, or the financial system in general …substantially impact the expected path of real economic activity.”  4  2  All speeches are available online at www.bankofengland.co.uk/speeches  2  These problems typically arise when the financial system is overwhelmed by events in the economy; when it doesn’t have the resilience to absorb them and so amplifies them as:  Credit dries up. Lenders are not matched with borrowers.

Zeti Akhtar Aziz: Corporate governance and aspects of the regulatory framework instituted in Malaysia Special address by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the 2nd Seminar for Central Banks and Monetary Agencies on AAOIFI’s Accounting Standards, Kuala Lumpur, 29 May 2002. *  *  *  Assalamu`alaikum Warahmatullahi Wabarakatuh and Good Morning Malaysia is indeed honoured to host this annual Seminar organised by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) for Central Banks and Monetary Agencies on AAOIFI’s Accounting Standards for Islamic financial institutions. Since its establishment in 1990, AAOIFI has made a significant contribution in formulating and issuing accounting and auditing standards for Islamic financial institutions. The standards issued by AAOIFI have contributed towards the improved quality of financial statements and reporting methodology of Islamic financial institutions. AAOIFI has also issued standards on the role of Syariah committees as well as the code of ethics that should govern the accountants and auditors of Islamic financial institutions. Undoubtedly, efforts by AAOIFI have accelerated the pace of transparency and corporate governance of Islamic financial institutions globally. Ladies and Gentlemen, A well functioning and efficient banking system is vital for achieving robust economic performance. Within the context of the economy, the banking institutions perform the important function of mobilising funds that are channelled to productive investments thereby generating economic activity.
Krzysztof Rybiński: Global labour market and its limitations – reasons and effects of the emergence of homo sapiens globalus Address by Mr Krzysztof Rybiński, Deputy President of the National Bank of Poland, at the debate: “WORKERS 2020 – a vision of the labour market and the labour environment in the forthcoming decades”, Gdańsk, 10 June 2006. *  *  *  Ladies and Gentlemen, The question about the symbol of the global labour market would most probably be answered by a majority of the Europeans with the words: “the Polish plumber”. In France, the Polish plumber has become the key culprit of the rejection of the European Constitution, with the French media showing the Polish plumber on his quest for depriving the hard-working French plumbers of their work. At the same time, the data of the French society of plumbers show that there were 140 Polish plumbers working in France at that time, with 6000 plumber jobs still remaining vacant in the country. 1 This example demonstrates how many false preconceptions concerning globalization are embedded in the media and in the public opinion. In the recent years, the process of globalization has been broadly based across all the markets: the financial market, the capital market, the market of products, services, knowledge, and the labour market. In many countries, the opportunities and threats related to the process of globalization have been observed early and their economic policy has been adjusted accordingly.

In the past, in response to increasing fuel prices or costs of living, trade unions demanded wage increases. It would result in the so–called second–round effects, and central banks had to increase their interest rates to mitigate inflation. Now, trade unions must take into consideration the fact that if wage increases exceed the growth in productivity, manufacturing may be off-shored to countries with lower manufacturing costs. In view of the research results presented at the recent conference organized by the Financial Times, dedicated to outsourcing and off-shoring 12 , an increasing number of companies is planning on the globalization of their manufacturing and services. This decision is underpinned with the wish to optimise costs, improve the quality, deliver new products, provide better customer service (e.g. use of various time zones to provide 24/7 customer service), mitigate risk, and drive innovation. The public sector holds the second position in the ranking of business sources for companies offering outsourcing and off-shoring services. The majority of the speakers stressed that the cost factor dominated in the first phase of off-shoring; now these are quality, innovation, and the use of talent bank in other countries that gain on significance. More and more often, aside from the supportive activity, companies outsource and off-shore their core business, as part of their elaborated strategy. They do so, because they obtain both lower costs, and better quality and innovation improvement. For instance, a call centre in Manila on the Philippines initially dealt with simple complaints.