samchain/econo-pairs-v1 huggingface dataset:
We have seen continuing tensions in world financial markets, doubts over the future behavior of the global economy, together with risks appearing, disappearing and reappearing again. As time has passed, with no evident signs of improvement in these economies’ outlook, problems have been exacerbated. Weak growth and the need for households, firms, banks and governments to reduce their debts, have created a vicious circle that hampers the solution to the macroeconomic and financial problems facing the advanced economies. Certainly, the case of the United States is different from the case of the Eurozone, because their institutions and the way they solve their internal imbalances are different. In the Eurozone, the situation of some economies is hardly sustainable. However, there are differences. While the economic block as a whole has a practically balanced current account, it varies from one country to the next. Germany has kept excess savings for several years, which has resulted in a current account surplus, while many peripheral countries post a deficit (figure i). Exchange rate and wage rigidities do not help resolve the imbalances within the region. Overall, in the past few quarters part of the necessary adjustments have been taking place. Germany has increased imports from peripheral Europe, and has cut down its exports to the same countries. Solving the imbalances of the Eurozone will take time and it will not be easy. Any solution will be costly, without a doubt.

The Board monitors closely the evolution of the external and internal macroeconomic scenario and its consequences on inflation, and it reaffirms its commitment to conduct monetary policy in a way such that projected inflation stands at 3 percent in the policy horizon. Allow me some final remarks. Concluding remarks As has happened often in the past several years, our presentation of these Reports coincides with increased global financial stress and poses important challenges. The short-term inflationary risks we identified in March have lessened, although for the medium term they are still present. Our immediate challenge, however, is dealing in the best way possible with any effects from the external crisis on our economy. The Board of the Central Bank is willing to adopt whatever measure it deems necessary if more adverse scenarios occur. Events abroad are being monitored with special attention. For the moment, however, we estimate that worst-case scenarios are possible but not the most likely, although they are more likely now than before. In our projections we use as a working assumption that, in the short term, the monetary policy rate will remain stable. A change in scenery will certainly lead to a change in decisions. As I said before, the Board – present in  6  BIS central bankers’ speeches  this session – monitors macroeconomic conditions closely and will act promptly whenever said changes warrant reorienting our monetary policy or using other tools at our disposal. There is the room and the will to do so.
But once public debt reaches levels at which its sustainability comes into question, for some financial investors at least, there is the risk of self-fulfilling crisis. This uncertainty can weigh heavily on investment and growth. III. Monetary policy response to policy-induced uncertainty  How should central banks respond to this policy-induced uncertainty? I would like to return to the three C’s I mentioned earlier: credibility, consistency and clarity. Page 5 sur 5 To protect our credibility, we need to stick to our mandate of price stability. And in this regard I would say that we are more certain about the path of inflation than we are for growth. A protectionist shock would be undoubtedly bad for growth but the effect on inflation is more ambiguous, at least in the short run. A persistently high oil price would as well be negative for growth but contribute to inflation. Sticking to our mandate also means no fiscal dominance. The relationship between monetary and fiscal policy ultimately depends on who determines the price level. The risk with fiscal dominant regimes is that inflation rises in line with public debt because people expect it to be eventually monetized by the central bank. Modern central banking is unambiguous on this point – we cannot have fiscal dominance and the path of inflation is set by the central bank. Not only are central banks forbidden from monetary financing, the timing of monetary policy decisions is not determined by the fiscal problems of member states. The second C is consistency.

The main credit needs among people in low growth areas and with low incomes, in particular, women are: •  access to small, unsecured, fixed term loans in cash;  •  quick access to credit without lengthy or intrusive application procedures;  •  affordable weekly payments with no hidden or extra charges;  •  automatic repayment arrangements, such as deduction from benefit or home visits by a collector; and  •  opportunities for making late payments or rescheduling loans without incurring charges when temporary financial problems occur. If anyone of these or a combination of these factors tend to deny access to financial institutions or to products, that is known as financial exclusion, which is often reflected as a symptom of poverty as well as a cause. As much as we are interested in financial inclusion, it is also necessary to reduce financial exclusion to a minimum, which is also a policy challenge. These are two sides of the same coin.
The exchange rate channel plays a more prominent role than the interest rate channel in the monetary transmission mechanism, to an extent which depends on the relative size of a country and the degree of financial market integration. This result is fully consistent with basic economic theory. Thus, the ability of central banks to control price developments over the medium term by influencing aggregate demand is not undermined, although the role and relative importance of different transmission channels might be affected by increasing global financial integration. What is the empirical evidence about the potential impact of globalisation on this channel of the monetary transmission mechanism? It is theoretically plausible that globalisation can influence to a certain extent key determinants of long-term interest rates, such as the global riskless real interest rate and the real risk premium. 2 Moreover, inflation expectations and the inflation risk premium may also have been influenced to some degree by the forces of globalisation, though monetary policy across the globe has certainly been the main factor. There is some empirical evidence that in the euro area, as well as in a broader sample of OECD countries, long-term rates are reacting less to changes in short-term rates than they used to. 3 Global factors seem to be increasingly important in determining national real bond yields. 4 Furthermore, the co-movement of US, German and Japanese bond yields has been exceptionally high over the past few years.

In addition, the distribution of net saving flows across the globe, with large excess saving (relative to domestic investment opportunities) in some emerging market economies searching for higher global investment returns also contributed to the fast pace of financial globalisation and development in recent years. When examining and assessing the effects of  BIS Review 9/2008  5  globalisation on the financial system – its efficiency and stability – it is important to keep in mind the role of the other factors, e.g. financial innovation, new business models, risk management practices, which have simultaneously exerted a significant impact on the functioning of financial markets and institutions. The securitisation of bank loans and the development of credit risk transfer (CRT) instruments and complex structured finance products have fundamentally changed the functioning of the financial system and the distribution of risk across sectors and borders. Since the mid-1980s, an unprecedented growth in the development and issuance of new financial market instruments has allowed the transfer of risks across market participants also in connection with previously relatively illiquid assets like bank loans and mortgages. While initially the focus was on transferring market risk, credit risk transfer instruments have increasingly gained in importance since the 1990s. 13 With respect to securitisation, this development can best be described by pointing out that the outstanding value of US agency mortgage-backed securities grew from about 100 billion US dollars in 1980 to about 4 trillion dollars in 2006 [Chart 9].
Let’s take a look at the UK’s experience in developing the Eurodollar market. Despite the sheer size of the Eurodollar market in the UK, it has not undermined the role of the British Pound in serving the domestic economy. Likewise, in the eyes of local investors in Hong Kong, RMB mainly represents an attractive investment choice in addition to other foreign currencies, and does not create any problems at all to the Hong Kong dollar’s role as a locally-used currency. 34. What about the idea of pegging the Hong Kong dollar to the RMB instead of the US dollar? In thinking about this question, it is important to recognise that the RMB can only be an anchor currency when it meets a number of important fundamental conditions. 35. First, there should be a high degree of synchronisation between the economic cycles in Hong Kong and the Mainland. At present, Hong Kong’s economic cycle is more affected by the flows of trade between the Mainland and the advanced economies, rather than domestic demand of the Mainland. And the business cycle synchronisation between Hong Kong and the US continues to be higher than that between Hong Kong and the Mainland. Secondly, to make it technically feasible for the RMB to be a reserve currency, the RMB must be freely convertible, the capital account control on the Mainland removed and all currencies allowed to flow freely.

The significant share of Hong Kong in Mainland0’s FDI and ODI underscores the unique role of Hong Kong as a gateway for foreign enterprises to access the Mainland market, while at the same time being a springboard for Mainland institutions to gain exposure to international markets. 7. With respect to portfolio investment flows, Mainland China has made important progress after joining the WTO in 2001. Portfolio inflows were allowed through the introduction of the Qualified Foreign Institutional Investor (QFII) scheme in 2002. A few years  BIS Review 153/2010  1  later, portfolio outflows were liberalised by introducing the Qualified Domestic Institutional Investor (QDII) scheme in 2006: this allows certain qualified banks, insurers and fund management companies to invest overseas. 8. At present, market attention has been focusing on portfolio flows from advanced economies towards Mainland China. In my view, portfolio flows in the opposite direction – i.e. portfolio outflows from Mainland China – will also present huge opportunities to the asset management industry, especially given the fact that the Mainland economy is the single largest provider of savings in the world. 9. Currently, outward portfolio investment (OPI) from the Mainland is only around 5% of its GDP, still far below 57% for East Asia, 42% for the US and over 100% for the UK. Our in-house research findings show that an economy’s portfolio investment outflows as a percentage of GDP tend to grow along with the level of economic development measured by per capita GDP.
Zeti Akhtar Aziz: Remaking Malaysia - investing in the New Malaysia Opening address by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the Euromoney Conference - “Remaking Malaysia: Investing in the New Malaysia”, Kuala Lumpur, 3 August 2004. *  *  *  Yang Amat Berhormat Dato' Seri Abdullah Ahmad Badawi, Prime Minister and Minister of Finance Distinguished Guests, Ladies and Gentlemen, Bismillahirrahmanirrahim and good morning, It gives me great pleasure to welcome you to this conference on 'Remaking Malaysia and Investing in the New Malaysia'. We are most honoured today by the presence of Yang Amat Berhormat Dato' Seri Abdullah Ahmad Badawi, Prime Minister and Finance Minister of Malaysia who has graciously accepted our invitation to deliver the Keynote Address of the Conference. This conference takes place at a time of strengthening economic conditions in the global and domestic economy. At the forefront of investors' minds is the sustainability of these trends. There is also much interest on the policy strategies being adopted and how Malaysia will reposition itself in this more competitive environment. This Conference has brought together key policy makers, investors, fund managers as well as leading corporate and government officials to discuss these issues. Building on the economic success that has been achieved for more than three decades, Malaysia is now taking the opportunity to reposition its strategies to ensure the sustainability of this strong growth performance.

On the financial sector, beyond the European Union’s borders, and with all our partners, we have to strive to maintain the collective rules of the game that we have put in place since the G20 summit of London in 2009. Nine years later, some actors may be tempted to have short memories and forget the lessons of the crisis. But diluting financial regulation would pave the way for the next financial crisis. So we must now be firmly committed to the “full, timely and consistent implementation” of Basel III, as successfully agreed last December and stated in the last G20’s Buenos Aires communiqué. Neither the United States today, nor the United Kingdom tomorrow, should take the path of unilateral deregulation, and we welcome their commitment. Evaluation and simplifications are obviously possible, under the common FSB umbrella: but regulatory competition would be nothing less than a lose-lose scenario with disastrous consequences. However, we are not done with financial regulation yet. We still have to finalise ongoing initiatives, especially on shadow banking. Indeed, the regulatory priority is no longer the solvency of banks, but the liquidity of non-banks: we stressed these financial stability risks in our Washington meetings last week. Tomorrow, we at the Banque de France will publish the 2018 Financial Stability Review that is focused on fast-growing market-based finance. I stress that we have to better monitor it, test it – through liquidity stress-tests –, and regulate it when necessary.
Hence, you need to raise the profile of the career in the insurance industry collectively, to attract the best and the brightest. With the right human capital, the industry will be better placed to capitalise on Asia's growth prospects. There is also a dearth of underwriting capacity in the region for some specialised risks, for example aviation, energy, political and terrorism risks, to name a few. MAS will explore ideas to enhance our competitiveness to encourage such risks to be underwritten in Singapore. We welcome feedback and suggestions. Specialisation and new techniques We recognise the importance of ancillary service providers within the insurance ecosystem, and believe that increased usage of specialised service providers can make our insurers more competitive. Singapore's existing infrastructure, political and economic environment is conducive for such service providers to thrive in, and we will enhance the business case with initiatives to help reduce the cost of operating in Singapore. Examples of specialised service providers include run-off management and related services, claims management and processing services, loss adjusting services and policy administration services, amongst others. 2  BIS Review 103/2006  Another new technique that can enhance insurers' competitiveness is insurance-linked securitisation, or ILS. ILS enables insurers to transfer risks to the capital market to strengthen their balance sheets. These securities also contribute to a more diverse and vibrant capital market. The global ILS market saw a record level of issuance in 2005, and 2006 looks set to exceed 2005.

We would not charge negative interest if we did not regard this as being absolutely crucial for us in fulfilling our mandate. It is of great importance to us for the Swiss people to understand why our current monetary policy is appropriate in its full context, and what impact it has for Switzerland as a whole. Page 2/8  Protracted decline in global interest rates To explain to you why the negative interest rate is necessary, I need to take a broader perspective and look back at the past quarter of a century. The level of interest rates has fallen markedly worldwide over this period. Chart 1 shows that the nominal yields on 10-year government bonds in Switzerland, Germany and the US have been declining since the 1990s. There are various factors behind this downward movement. The first of these is the success central banks have had in their efforts to combat inflation. After the negative experiences with high inflation rates in the 1970s and 1980s, at the beginning of the 1990s many central banks started striving to achieve price stability. Inflation subsequently fell, and so too did the rates of interest on savings accounts and financial market yields. After all, if the money on a savings account retains its value thanks to inflation being lower, the interest no longer needs to compensate for any erosion in value. Lower inflation and the attendant decline in the level of nominal interest rates are essentially a positive development for households and companies alike.
Participant or member discipline should complement the work of payments system overseers, in a role analogous to the market discipline applied by counterparties to financial institutions. Clearing and settlement arrangements for OTC derivatives As we look at the evolution of the global payments system, one critical area that deserves further attention by market participants and central banks is the clearing and settlement arrangements for the over-the-counter derivatives market. This is an area where the innovation that has driven rapid growth has not been matched by a comparable investment in the infrastructure for post-trade processing. Because of the relatively slow development of clearing and settlement services for the OTC derivatives market, dealers and their counterparties have been forced to assume and manage risks that are largely avoidable. Unexecuted confirmations create unnecessary legal risk for counterparties and can add to replacement cost risk. Delays and errors in settlement add cost and liquidity risk. There are a number of important efforts by the private and official sectors that offer the promise of progress. The effort underway by the industry to standardize documentation, automate confirmation  BIS Review 59/2004  3  procedures, and match and reconcile payment flows is very important. The Fed has played a role in shaping recommendations for close-out netting on a cross-product basis, and has been strongly supportive of efforts to put these provisions into U. S. law.

We believe that the launch of the bulletin will help to raise product awareness and improve price transparency, thereby helping to promote the development of the retail bond market in Hong Kong. The bulletin is developed by the Central Moneymarkets Unit of the HKMA. We are delighted to have eight major banks, which are present here today, to be the price providers. Thanks to their support, indicative bid/offer prices of over 200 bonds of different currencies issued by both public and private sector entities will be available on bulletin. Investors may access the bulletin later today for bond information. The website address is https://www.cmu.org.hk. The bulletin also provides direct hyperlinks to the price providers’ websites to facilitate investors to approach the price providers for trading. Relevant transaction charges imposed by individual price providers are also posted on the bulletin. Retail investors can easily gain access to, and conclude trades with, the price providers in a convenient, secure and efficient manner. We are thankful to banks and potential users for their valuable comments during the development of the bulletin. We will monitor the usage and feedback to gauge whether there is scope for future expansion. We would welcome feedback from users and would endeavour to improve the bulletin on a continuous basis. Other banks interested to join as price providers are welcome to approach the HKMA for further information.
Timothy F Geithner: Overview of the US financial system Remarks by Mr Timothy F Geithner, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Bond Market Association’s annual meeting, New York, 20 April 2005. *  *  *  Thanks for giving me the opportunity to join you today. The U.S. and the world economy now confront the conjunction of several different transitions, which will have important implications for the U.S. financial system. Among the most important of these transitions are: -  The approaching demographic pressures on fiscal resources, which will hit most major economies at a time when underlying fiscal positions are still likely to be in substantial deficit. -  The disposition of the global imbalances reflected most conspicuously in the U.S. current account deficit. -  The inevitable evolution in the exchange rate regimes of those countries that have been actively targeting their nominal exchange rate against the dollar to a system where there is more variability in their bilateral and real effective exchange rates. -  The transition from a long period of exceptionally low short-term nominal and real interest rates to levels more appropriate to the present circumstances. The slope and shape of this path toward equilibrium is necessarily subject to considerable uncertainty, and will depend on how the outlook unfolds. These are all types of disequilibria. They can be sustained for a time, but not indefinitely. The imbalances in our fiscal and external positions could be diffused gradually and smoothly.

On that note, I look forward to the engaging sessions ahead. Thank you. 5/5  BIS central bankers' speeches