samchain/econo-pairs-v1 huggingface dataset:
I have on many occasions, at monetary policy meetings and in speeches, put forward the view that policy rate adjustments should normally be made gradually as a result of the uncertainty connected to forecasts and economic statistics. The well-known economists Orphanides and Williams say in an essay that this uncertainty indicates that one should not allow monetary policy to be influenced by contradictory information and statistics that are constantly revised. 10 Instead, one should normally allow monetary policy to change gradually. This limits the impact of contradictory information and statistics that are often revised. Former Federal Reserve Chairman, Alan Greenspan, said “Uncertainty is not just an important feature of the monetary landscape; it is the defining characteristic of that landscape.” I can only agree with him. 10  Orphanides, Athanasios and John C. Williams, “Robust Monetary Policy Rules with Unknown Natural Rates”, Brooking Papers on Economic Activity (2002), pp. 63–118. BIS central bankers’ speeches  9

About our external scenario, incoming data show improved performance of exports across sectors (figure 9). Still, examining numbers of the first half, we foresee that the export volumes will contract during the year. However, by 2018 they should recover thanks to improvements in the world economy, which coupled with better prices increase our estimated 5  trade balance for next year. The low comparison base due to the Escondida mine strike downtime early this year will also result in higher mining exports in 2018. Thus, in 2018, the current account deficit should be lower than we expected in September, close to 1% of GDP, similar to our 2017 projection. At trend prices, the current account deficit remains at 2.6% on average in 2017-2018 (table 1). Aside from the scenario I have just described for domestic activity and spending, the convergence of inflation to the target also considers a mild depreciation of the real exchange rate that will cause it to converge from where it was at the closing of this Report to its longterm equilibrium within the projection horizon. The baseline scenario also contemplates that the prices of foods, particularly fresh fruits and vegetables, will return to their normal patterns, so their annual inflation will be rising over the course of 2018. About monetary policy, the Board estimates that in the baseline scenario the surprises that have pulled inflation down below expectations do not compromise the convergence of inflation to the target.
I would like to draw your attention to the invitation extended by His Excellency the President to all of us in his Policy Manifesto; “Mahinda Chintana: Vision for the Future”, I quote “Together, let us embark on this new journey to lead our beloved motherland to a brighter future”. I believe we all are with it. Distinguished guests, I need your permission to extend my special thanks on behalf of our team at the Consolidation Unit to major contributors who are our partners in the success story of the consolidation programme. Firstly, I wish to thank the Governor for his exceptional leadership and guidance given to us in planning the programme and its smooth execution from the beginning. Secondly, I extend my sincere thanks to the members of the Monetary Board, Secretary to Ministry of Finance and Planning; Dr. P B Jayasundera and the Deputy Governors of the Central Bank for their continuous support and guidance, and in granting necessary approvals expeditiously. Thirdly, I must thank all the members of the financial institutions including the board of directors, senior officials, all employees, members of trade unions, shareholders, borrowers, depositors and all other related parties for their positive contribution to the programme by understanding very wisely, the importance of this project to drive our future economy.

Banking sector Under the consolidation programme, the bigger banks in the sector are permitted to benefit largely from organic growth while the mid-tier banks are expected to strengthen their financial viability and grow through consolidation. As larger banks grow, it will be difficult for smaller banks to remain competitive, and therefore, small banks are encouraged to merge with strong partners. The outcome of the consolidation in the banking sector is expected to result in a sector where at least 5 Sri Lankan banks will have assets of over Rs. 1 trillion with a stronger regional presence by 2016, while domestic banks, which hold assets less than Rs.100 billion now will have to increase their asset base above Rs.100 billion through consolidation by 2016. Further, as the Sri Lankan economy’s investment ratio is expected to be maintained at over 30 per cent of GDP, there will be an increasing demand for investments within the country. However, the 2 banks with development banking focus in Sri Lanka, namely, the National Development Bank PLC and DFCC Bank with DFCC Vardana Bank Ltd., are still not as big as the economy requires them to be to cater to the current and future needs of the economy. Therefore, these 3 banks will be merged so that the resulting entity would be large enough to comfortably raise long-term capital from domestic as well as international markets and cater to the growing demand for investments by both the private and public sectors.
In this context, it should be borne in mind that in the long term, central banks can affect inflation and can have a corresponding impact on the nominal exchange rate, but they cannot affect the real exchange rate in the long run. If the real exchange rate rises because of an increase in the equilibrium real exchange rate and the Central Bank halts the rise in the nominal exchange rate, the real exchange rate will ultimately rise in any case, through larger wage increases and inflation. If the Bank had halted the rise in the exchange rate at all costs, inflation would probably be well above the target already, and it is very unlikely that inflation expectations would be at target. This would also have been inconsistent with the Bank’s legally mandated price stability objective. It would also have been quite costly, as the credibility of monetary policy would have been gone and interest rates in the future would need to be higher in order to restore that credibility. If there is the will to impede the rise in the real exchange rate and mitigate the crowding-out effect that tourism has on other sectors, which is certainly needed, but without sacrificing price stability, it must be done with policy instruments that can have a lasting impact on the real exchange rate, such as tighter fiscal policy.

For this year, it is forecast that GDP growth will remain well above long-term growth in potential output and demand pressures will still increase, but that inflation is projected to remain below target for most of the year. This is uncertain, however, and various changes have taken place and others may lie ahead, which could affect future developments. The tradable sector is now experiencing stronger crowding-out effects from tourism, after the rapid growth of the latter in recent years. Sizeable pay increases in the recent term and last year’s strong appreciation of the króna cut into profits, and companies now have less scope to absorb pay rises. The recent appreciation of the króna is a result of growth in tourism and other favourable developments, and it tends to shift demand outside the domestic economy, thereby reducing the positive output gap. Although forecasts based on given assumptions and available models indicate that the exchange rate will continue to rise, it should be noted that this is highly uncertain. Capital account liberalisation could contribute to either a higher exchange rate or a lower one in the short run, depending on how expectations develop. The special reserve requirements imposed last June on capital inflows to the bond market and high-interest deposits have contained the rise in the exchange rate and will reduce the likelihood of a steep carry trade-related appreciation in the near term. From 12 March, when capital account liberalisation was announced, through yesterday’s official listing, the exchange rate of the króna had fallen by 3.8%.
The functioning of the fixed-income market is important for us as a central bank. It makes it possible to implement monetary policy and thus to fulfil our task of controlling inflation. We aim to influence economic activity and thereby inflation via the price for credit – the interest rate. For this to be possible, the payment system and the credit markets must function so that the Riksbank’s interest rate decisions show up in other interest rates. What does this require of the fixed-interest market? A discussion of which characteristics the fixed-income market should have so that monetary policy can be as effective as possible must start from the answers to two questions: What is the objective of monetary policy? And, what instruments are at its disposal? The situation in both these respects – monetary policy’s objective and the toolbox – can differ somewhat between countries. My focus is, of course, on the Riksbank‘s monetary policy objective and instruments. Monetary policy’s objective and steering system We have specified the objective for the Riksbank’s monetary policy as an annual rate of inflation of 2 per cent plus or minus one percentage point. Our aim in setting the interest rate is that inflation will develop in such a way that the goal is fulfilled. When the Executive Board has decided the level of the repo rate, it is up to the monetary policy steering system to ensure that the decision shows up in market interest rates.

Some of those who stop trading when markets are unsettled would probably not do so if they had a known and safe counterparty with whom to trade in a properly transparent market. Conditions are then in place for arranging securities transactions in ways that are safe and efficient, so that financial stability can be more satisfactory. The fixed-income market I shall now say something about the fixed-income market. The fixed-income market in Sweden differs from its larger counterparts in Europe. There are considerably fewer participants and the market is shallower – less liquid. This presumably entails higher costs  8  4  This refers to the derivatives that are not traded on exchanges, for instance swaps, futures and options. BIS Review 153/2008  for transactions of a given size, as well as closer relationships between the players. These circumstances are liable to affect how the market functions, particularly in times of unrest. The risk propensity falls and with relatively few participants, market liquidity is easily eroded. Trading in the Swedish bond and money market is still done mainly by telephone, over-thecounter, though some electronic trading has existed since 2001. This electronic trading is in three benchmark bonds. To work properly, electronic trading needs products that are highly standardised, as well as relatively high liquidity. In Europe, electronic trading is used for roughly 75 per cent of all transactions but they account for only about 50 per cent of the volume. Large orders are still traded by telephone.
As I have mentioned before, due to increased confidence that the fall in inflation is  BIS Review 36/2005  5  permanent and the effective communications policy implemented in the last three years, the inflation target has become an increasingly reliable anchor for economic units and there have been significant breaks in the inflation inertia. Another change observed in inflation dynamics is that the decline in inflation also led to reducing its volatility. With less volatility in inflation, it can be seen that prices have resumed their signaling role in the economy. This development, which shows ease in uncertainty, has been instrumental in the decline of the risk premium and thus the nominal and real interest rates. It has also helped to reduce the borrowing cost for consumers and the opportunity cost of investment for producers. In fact, during this period not only real interest rates eased, but also the general level of interest rates and the extension of maturities. During the last three years, ex-ante real interest rates declined more than 20 points and nominal interest rates more than 50 points. The Turkish Treasury borrowed for the first time ever with a 5 year-maturity in the domestic market. Long-term housing credits, known as “mortgages” and widespread in developed countries for a long time, will start to be extended for the first time in the country’s history. This is the most striking evidence that enough confidence has been established in the economy.

I am also delighted that the new Pacte Bill, which was recently adopted at the first reading by the National Assembly, seeks to promote equity investment as well as long-term investment. Our discussions in the lead-up helped to shape this legislation, with the result that the bill includes measures to reform “eurogrowth” (Eurocroissance) life insurance products at long last, setting an ambitious target – with which you are all familiar – of EUR 20 billion in outstandings, compared with EUR 2 billion at present. Accordingly, France’s lawmakers have expanded the tools put in place to achieve this goal. Now it is time to deliver. We are entitled to expect a fresh start, with a reset for eurogrowth products and innovative and energetic sales and marketing efforts by your industry, once the framework 1/3  BIS central bankers' speeches  has been simplified. Retirement savings, meanwhile, have been the subject of a lively annuity versus lump sum debate. Like you, I am glad that the ability to receive annuity payments – and above all the principle of an annuity product – has been maintained across the board, not to defend one industry against another, but because a lifetime income is closer to a retirement product and because this timeframe should support more equity investment. Here again, though, it is up to you to take the steps to enable retirement savings to finally take off in France and ensure that your approach to asset/liability management better takes into account the longer durations of these products.
Consequently, rising oil prices have contributed towards augmenting revenues of these oil-producing nations, while on the other hand threatening the revenues of the other nations that only use but do not produce oil. In spite of the energy obtained largely from hydro and some geothermal and solar sources in Africa, the population continues to lag behind the rest of the developing world in terms of access to electricity. Approximately 77.5% of the sub-Saharan population has no access to electricity, with the majority of the population relying on biomass (dung and firewood) for domestic energy needs (OECD/ ADB, 2003). To a large extent, economic growth in Africa is still largely driven by production of raw materials that are hardly subjected to meaningful industrial processing. This source of economic growth has a direct dependence on the use of natural resources mainly in agriculture and mining. The lack of valueadding processing largely underpins the historical low levels of economic growth. 3. Effects of environmental growth on African economic growth  3.1  Environmental issues in African economic growth  Environmental issues ought to be an important area of concern for leaders and policy makers, when making policy decisions about human development and economic welfare, especially those in the developing world. Many growth sectors are in effect directly or indirectly related to the environment.

Just as important is how these rules are put into practice. In normal circumstances, such as those before the crisis, this is a rather easy task, since the public and politicians understand “conventional” monetary policy quite well. People have a clear picture of how central banks act and communicate. In such times, the requirements of accountability and transparency are satisfied without undue controversy through a number of measures, namely, the annual accountability report submitted to parliament, regular  4  Cf. the National Bank Act (NBA) and Message concerning the revision of the National Bank Act. Functional independence means, in particular, that the SNB fulfils its mandate without seeking or accepting instruction from any of these bodies. Financial independence includes both the budgetary autonomy of the SNB and the prohibition against granting loans to the Confederation, thereby barring the state from using the banknote press. The SNB’s independence in personnel issues, finally, is ensured by the fact that Governing Board members and their deputies can only be dismissed during their term of office if they no longer fulfil the requirements for exercising that office or if they have committed a grave offence. 5  Specifically, art. 99 of the Federal Constitution states that “as an independent central bank, the Swiss National Bank shall follow monetary policy which serves the general interest of the country; it shall be administered with the cooperation and under the supervision of the Confederation.” Art. 5 of the NBA sets out in detail the SNB’s constitutional mandate.
As in the case of sustainable bonds, Hong Kong is the largest hub for arranging green and sustainable loans in the region, capturing one-third of the market in 2022. And we expect to maintain this position in 2022 – our preliminary internal analysis shows that green and sustainable loan issuance would double from 2021 to exceed $ billion. 11. While this is impressive, we have launched a number of initiatives to encourage further growth of our sustainable loans market. One of these is our Green and Sustainable Finance Grant Scheme, which provides subsidies to support green debt issuance in Hong Kong. Since the Scheme was launched in 2021, we have provided grants to over 210 debt instruments, totaling around $ billion, many of which were loans aligned with APLMA's principles. And we are constantly enhancing the scheme to encourage usage, such as by halving the minimum borrowing amount threshold to $ million last year. 12. In addition, we are working to address some key challenges that the industry faces, particularly as regards data and talent, by working with the industry to build database and data analytical tools, and provide relevant training and work experience. We have also simplified the process for bringing sustainability-finance professionals to Hong Kong from overseas. 13. I would like to highlight the Capacity Building Support Scheme that the Government launched last December to offer subsidies of up to $ to students and practitioners that take up sustainable finance for trainings and qualifications.

5 Unfortunately experience, including the experience gained during the Swedish crisis of the 1990s, has shown that it can be difficult to reach practical decisions on measures to promote financial stability. 3  Another factor that we have highlighted in our inquiry into risks on the housing market and in our stability reports is the banks’ mortgage funding, which to an increasing extent comes from foreign investors. The banks are dependent on the confidence of these investors in the Swedish housing market for their funding. Historically, foreign investors have been “volatile” in times of market unease. A fall in housing prices in Sweden could therefore constitute a funding risk for the Swedish banks. 4  See “The economy will benefit from stricter requirements on banks”, Finansinspektionen press release, 26 November. 5  Finansinspektionen’s proposal on risk weights for mortgages has now been circulated to the authorities concerned for comment and the Riksbank will present its comments at a later date. 4  BIS central bankers’ speeches  A point that I have made in many different contexts is worth repeating: the less others do, the more monetary policy has to do. As you know, the Riksbank has two objectives for its operations: “a safe and efficient payment system”, which we usually interpret as financial stability, and “price stability”, which the Riksbank has formulated as an inflation target of two per cent. I believe that one of the most important lessons of the financial crisis is that these two objectives are interlinked.
Mr Lee examines some of the major themes for strengthening the global financial system against the background of the financial crisis in Asia  Opening address by Mr Lee Hsien Loong, Chairman of the Board of Directors of The Monetary Authority of Singapore and Deputy Prime Minister at the fifth meeting of Finance and Central Bank deputies on the Manila Framework at Shangri-La Hotel on 29 August 1999. *  *  *  Introduction I am happy to address the Manila Framework Group. Prospects for the region have brightened considerably since your inaugural gathering in November 1997, in the depths of the regional economic turmoil. The worst of the crisis is now well past. Most of the crisis-countries are seeing growth again. Investor sentiment, while edgy, is generally upbeat. Equity markets have surged, some beyond pre-crisis levels. Currencies have stabilised; indeed some governments have had to temper the appreciation of their currencies. But financial markets are notorious for their short-term memories. An upturn does not necessarily mean that basic problems have been solved. It remains important for financial regulators and policymakers to remain mindful of the lessons thrown up by the crisis and to tackle them before another storm blows up. No two Asian economies are the same. During the crisis, hardly any were spared the panic and contagion. But how each was struck, how external problems interacted with internal weaknesses and how each government responded, varied from country to country. These diverse experiences offer rich materials for study and contrast.

More likely and prudently, they will pursue incremental improvements to strengthen the structure and remedy the flaws which have been uncovered. We must find ways to make bubbles and crashes less likely and make countries less vulnerable to such mishaps when they occur. While we can strengthen the global financial system, we can never eliminate bubbles and crashes completely. Manias, panics and crashes are inherent to capitalism dating back to the tulip mania and South Sea Bubble of the 17th century and probably before. In theory, investors make independent decisions which collectively result in a stable and efficient market outcome. In reality, uncertainty due to incomplete information and a basic human instinct to herd can prove destabilising and disastrous. For small open economies, the best defence against an uncertain and sometimes dangerous environment is to pursue prudent macroeconomic policies, strengthen their financial systems and improve their governance framework. Sound domestic policies and institutions cannot eliminate panic and contagion. But they can cushion the adverse effects and make the economies more resilient to the financial shocks when they occur. Thank you. 7  BIS Review 93/1999