samchain/econo-pairs-v1 huggingface dataset:
In its conduct of monetary policy, Norges Bank places emphasis on satisfying the fundamental preconditions for exchange rate stability against the euro: instruments must be oriented with a view to reducing price and cost inflation to the level aimed at by the European Central Bank (ECB). At the BIS Review 105/2000  8  same time, monetary policy must not in itself contribute to deflationary recessions, as this could undermine confidence in the krone. According to the Maastricht Treaty, the main objective of the ECB is the maintenance of price stability. The ECB has defined price stability as inflation of less than 2%. Inflation in Norway cannot remain higher than inflation in the euro area year after year without this having consequences for the exchange rate of the Norwegian krone against the euro. If price and cost inflation remains higher than the rate of increase aimed at by the ECB over a long period, our experience indicates that the krone will depreciate against the euro sooner or later. Norges Bank must therefore counter such a development. There are institutional differences between the Norwegian monetary policy regime and monetary policy in countries with an inflation target. Norges Bank will inform the government authorities (via the Ministry of Finance) if measures other than those available to the central bank are required in the event that the krone exchange rate cannot be returned to its initial range without creating inflation or a deflationary recession.

I have provided evidence in the past that the unconventional monetary policy measures adopted by the ECB since 2014 have led to sizeable capital outflows from the euro area that have contributed to the inflows into the United States.2 With the ECB’s net asset purchases nearing their end – the Governing Council yesterday reaffirmed its anticipation that net purchases will end after December – concerns have been voiced that cross-border capital flows may once again rise to become a source of market volatility, with uncertain effects on global asset prices. In my remarks today I will argue that such fears are largely unfounded. I will present evidence that suggests that the stock effect of central bank asset purchase programmes, together with increased transparency around our reaction function, has helped mitigate abrupt changes in international asset allocation in recent years. And I will argue that recent changes to our forward guidance, together with sizeable future reinvestments from maturing securities under our Asset Purchase Programme (APP), will also in the future reduce the likelihood of sudden and adverse spillover and spillback effects. This will help to maintain the financial conditions necessary for us to achieve our price stability objective. Unconventional monetary policy and international capital flows Let me start by briefly recalling the empirical evidence on the impact of the ECB’s policies on cross-border capital flows. My first slide illustrates this impact quite clearly for the euro area.
To-date, the CCI has facilitated 239 cross-border financing deals worth over $ billion. In 2022 alone, 27 financing deals worth about $ billion were concluded. The second imperative – green and transition financing – is a new dimension in financial co-operation between China and Singapore as well as ASEAN. Many countries and corporates have made commitments to reach net-zero by 2050. Financing is critical to support these efforts and facilitate the progressive decarbonisation of our economies. McKinsey has estimated that $ trillion a year till 2050 is needed to achieve netzero. One-third of this amount is required in the Asia-Pacific. MAS and the People's Bank of China (PBC) have formed a China-Singapore Green Finance Taskforce. The Taskforce will: facilitate public-private sector exchanges to better mobilise private capital for sustainable development needs; and collaborate on standards, financing solutions, data collection, and technology enablers to enhance green investment opportunities in China and the ASEAN region. The first session of the Taskforce will be held tomorrow in Chongqing. Let me suggest four potential areas of co-operation between Chongqing and Singapore, leveraging on the work of the China-Singapore Green Finance Taskforce. First, we can work together to incubate pilots and test initiatives. 2/3  BIS - Central bankers' speeches  Chongqing has a green financial reform and innovation pilot zone. This could serve as a safe space for green finance initiatives to be piloted. As Taskforce discussions progress, we can work closely with Chongqing to assess suitable green projects for incubation.

Here, I must say, our fears proved not just to be unfounded, but the reality turned out to be much more favourable than we could have hoped for. The exchange rate between the Swiss franc and the euro ended up being much steadier than expected, in fact even steadier than it used to be against the German mark, not to mention the French franc and the Italian lira. Over the past six years, the real exchange rate has moved within a relatively narrow band little more than five percentage points wide. Except for the immediate after-September-11 period, when the Swiss franc appreciated significantly, the external value of the franc has largely reflected economic fundamentals. In fact, even the post 9/11 safe-haven effect was relatively mild compared to what we experienced in the past, during the seventies and the eighties, for instance. But vigilance is of the essence. Recent foreign exchange market developments show that in highly turbulent times the Swiss franc can come under upward speculative pressure. This may interfere with our domestic monetary strategy and can eventually trigger corrective policy actions. 4. A new international monetary order  I truly believe that one can make the case that the introduction of the euro has brought about a new international monetary order, that it has produced an element of stability that benefits many countries, not just Europe’s immediate neighbours, but nations around the globe.
Otherwise, a durable single currency would not be feasible. Yet given that political union in Europe over the short term is inconceivable, will a monetary union not be able to survive without political union? In my view, the most important lesson we’ve learned in this crisis is that it is possible to enjoy the benefits of a single currency without political union, but only if strong divergences between the member countries are avoided. This has been understood by the European Union and is what has prompted the changes to the Stability and Growth Pact and to economic governance, which are intended precisely to correct divergences before they become so great that they are difficult to redress. And it must be acknowledged that here a good deal of progress has been made over the past year. The unfolding of the crisis has shown that the governance model in place to date in the EU has been of no use in ensuring economic policy consistency or in managing crisis episodes flexibly and effectively. It’s now clear that public finances were not sufficiently restructured in the upturn, that macroeconomic divergences were excessive and that we need a well-designed financial aid mechanism to assist ailing countries swiftly and effectively. Mindful of this, European governments and institutions have taken major steps towards correcting deficiencies in three fundamental areas: the strengthening of fiscal discipline, closer surveillance of macroeconomic maladjustments and the creation of a permanent crisis-management framework.

Well, by the next day, the markets had figured it out; the projections are made by all FOMC participants, while the statement reflects the policy views agreed upon at the meeting by the voting members of the Committee. We all come into the meeting with our projections, but we then do have a real meeting: All of the participants exchange ideas and argue points of views, and then the voters on the Committee come to a consensus and make a collective policy decision. The information regarding the federal funds rate in the SEP does not substitute for this formal decision of the voting members of the FOMC. That said, the diversity of views is a fact of life. Policymakers may well have differing judgments on the appropriate stance of monetary policy in the particular economic circumstances of the moment. These communications initiatives cannot eliminate these differences of opinion. But they further discipline the parameters of our discussions, clarify the judgments that underlie our policy decisions and enhance transparency and the public’s ability to evaluate current monetary policy with alternative approaches. Forward guidance and policy commitment in an explicit state-contingent policy The macroeconomic environment The new policy tools can also complement the kinds of accommodative policies I have been advocating for some time. The U.S. is now more than two and a half years into its modest and uneven recovery from the Great Recession. Real gross domestic product growth has averaged just 2-1/2 percent.
The FSAP is also expected to include implications of international interlinkages but I admit that this part has become gradually more difficult as a result of the increased scale, scope and complexity of financial institutions and markets conducting cross-border activities. To be blunt: How do you assess the effects on the Swedish financial system from our internationally-active banks which practice centralised funding activities and even to some extent credit registration? How do you look at banks organised along product lines, while regulation and supervision mostly is national? This is the rationale for moving to regional FSAPs in order to catch issues we might miss if we focus on monitoring single country financial systems only. The FSAP has significant added value embedded in its integrated approach. The integrated approach implies that we assess, for instance, whether weaknesses in public institutions or in other preconditions undermine efficient regulation and supervision; or whether volatile macro economic conditions hinder the effective functioning of financial markets and institutions. We also assess whether there is an appropriate balance in the financial sector; as an example, some countries are excessively reliant on a dominating banking sector. Finally, stress tests are performed to identify possible causes for threats to financial sector stability and also to identify where the first signs of instability might emerge – such as in banks, other financial intermediaries or in the payments system. This approach links together the different parts and presents an integrated view of the overall situation.

BIS Review 165/2009  1  My own hypothesis is that instead of integration of jurisdictions, competition between them might sometimes be more beneficial to economic growth. Countries should compete for investors, capital and labour force by making their tax systems, legal frameworks and other conditions as efficient and friendly as possible. Competition is sometimes useful not only on the markets, but also among jurisdictions and states. Political integration can, at some point, become an obstacle to competition, sometimes even intentionally. I think that the EU is, unfortunately, right now at this stage. What a shame. And why is that? Well, when we choose the path of political integration, we have to watch out carefully for certain pitfalls – and I am not sure we have been careful enough in this respect. A major pitfall is the effect that we can observe whenever a group of people or institutions hires someone else to do a job for them. In economics, we call it the principal-agent model, or we say that a group of principals hires an agent. The idea is that the agent will follow the directions of the principals. A simple example: the shareholders of a company choose a manager to run their company. But sometimes it happens in this model that the agent tries to turn the power structure around and to switch from one who simply follows directions to one who deliberately sets the agenda.
Private sector external debt, which accounted for about 80 percent of foreign liabilities, increased by 5 percent to $ billion due to revaluation changes in non-us dollar denominated loans predominantly in the electricity, manufacturing, information and communication as well as real estate sectors. Esteemed invited guests, in terms of flows, overall net foreign liability outflows of $ million 1/3  BIS central bankers' speeches  were recorded in 2020 against net inflows of $ million in 2019. This was due to loan repayments to non-affiliates by the mining, manufacturing, electricity as well as wholesale and retail trade sectors, and the reduction in currency holdings by non-residents in domestic deposittaking corporations. However, FDI liability inflows amounted to $ million compared to $ million in 2019. Reduced re-invested earnings and debt repayments, largely by the mining and quarrying sector, accounted for the decline in FDI inflows. Canada continued to be the major source of private sector foreign liabilities. Ladies and gentlemen, the stock of private sector foreign liabilities declined further in the first half of 2021 to $ billion due to loan repayments mostly by the mining and quarrying sector as well as revaluation effects on equity. However, a net inflow of about $ million was recorded against net outflows of $ million a year ago. This was due to the upswing in FDI inflows on account of higher reinvested earnings by the mining, deposit-taking corporation, manufacturing, electricity, as well as information and communication sectors.

In most areas, inflation has fallen significantly and has been more stable than previously. The real economy also seemed to be developing with more stability, which was probably partly due to the fact that the policy was being conducted in a better reasoned manner than previously. There may be those who believed that most problems had been solved, and that the improved stability of the macroeconomy was here to stay. But the Great Moderation would turn out to be a deceptive calm. But an improved monetary policy was not enough The recent period has seen frequent discussion of the financial crisis and its causes, to put it mildly. Consequently, I do not intend to go into any detailed description of the development of the crisis, but will remain on a relatively intuitive level. The origin of the financial crisis lay in a number of interacting macroeconomic and microeconomic factors. However, the core of the crisis was that the banks and other participants took on too much debt in relation to the risks they were taking. Shortcomings in the regulatory framework, combined with a lack of understanding of new complex financial instruments, contributed towards the altogether too low pricing of risk by the market. Regulatory frameworks and supervision also failed to ensure that the banks had enough high-quality capital to maintain confidence when the economy took a downward turn and inflated asset values fell.
One is to assume that potential output evolves smoothly over time and that actual output fluctuates around this; potential output can then be proxied by a smooth trend line fitted through the more jagged path of actual output. A more structural approach takes measures of capital and the available labour force (after allowing for any labour market frictions) and then assumes something about the nature of the technology with which they are combined to produce output. A third approach eschews direct measurement of potential output altogether and instead uses survey-based measures of the margin of unused resources to draw inferences about the evolution of potential output. While judging the margin of spare capacity is always a problem for policy makers, it is particularly difficult at the current juncture because a banking crisis accompanied by a deep recession is likely to lead to some impairment of the economy’s supply capacity. Moreover, different approaches presently suggest very different degrees of supply impairment. Suppose we use the first of the approaches above, assuming both that the economy was operating around potential in the years leading up to the crisis and that potential output had continued to rise at broadly the same rate throughout the recession, reflecting continued growth in human knowledge. That approach would point to output being a little under 10% below potential at the current juncture, an enormous margin of unused resources. But we get a very different picture if we look at direct measures of the margin of unused resources.

The two exceptions are the Great Contraction of 2008–9 and the “phantom” slowdown after the 1997–8 Asia/LTCM crisis, when early vintages of the official data for output as well as business surveys pointed to a slowing in growth that was not subsequently borne out in mature vintages of the official data. And for both these episodes, 2 no forecaster came close to predicting the outcome. The generic point here – which holds true in fuller analyses over longer time periods – is that the big divergences, when they occur, are not between the central forecasts made by different bodies, but rather between those forecasts and the corresponding outturns. And that is as it should be: deviations of outturns from central (mean) forecasts should be unpredictable if those forecasters are using the information that is available to them efficiently. Why then, as the Queen famously asked at the London School of Economics in November 2008, did no-one see the Great Contraction coming? Some economic downturns are broadly predictable in nature. In particular, that is the case when they are deliberately policy-induced in order to squeeze inflation down, though even then it may still be difficult to get the magnitude and timing right, and there will always be other unexpected events that perturb the path of the economy. But downturns associated with financial or banking crises are rather different animals. Rapid growth in credit and asset prices can act as a warning sign of building vulnerabilities, but frequently appear to be validated by developments in underlying economic fundamentals.
And finally, there will be a common chair, the Governor, and overlapping membership. The members common to the two committees – four of us – will be in a minority on both to ensure that our perspective does not dominate either. How will the FPC operate and be accountable? Although separate, the FPC will in many respects operate in much the same way as our Monetary Policy Committee. There will be a schedule of regular policy meetings: four per year. A record of each will be published. And twice a year, the analysis underpinning our Committee’s deliberations and decisions will be set out in the Financial Stability Report. The role of the FSR will, therefore, become more like that of the Bank’s Inflation Report in monetary policy. Put crudely, warnings will carry greater weight under a regime where the  10  BIS central bankers’ speeches  FPC can actually take action. Consistent with that, the FSR will in future be launched via a press conference. We expect, and hope, to be called regularly to give evidence to the Treasury Committee of the House of Commons, and perhaps Committees of the House of Lords too. Public hearings will help to keep financial stability issues in the public eye, and us on our toes, even when stability once again prevails and is expected to last. The Select Committee process, and the debate it sparks, will be a vital bulwark against complacency.

Philipp M Hildebrand: Ten theories on the economic relationship Switzerland Europe Summary of a speech by Dr Philipp M Hildebrand, Member of the Governing Board of the Swiss National Bank, to the Arbeitgeberverband Basel, Basel, 8 September 2004. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch). *  *  *  The relationship between Switzerland and the EU is close in so many ways that it appears almost stronger than that among many member states themselves. The debate on a possible integration into the EU as a logical consequence should be as broad-based as possible. Economically speaking, the issue has become more pressing since the introduction of the euro, as Switzerland is now surrounded by a single-currency area. Switzerland’s weaker economic growth is also frequently quoted as an argument in favour of integration, since the necessary domestic structural reforms would then be easier to realise. However, one tends to overlook the fact that the national authorities would continue to be responsible for implementing reforms and that, moreover, the absorption potential of autonomous monetary and fiscal policies would be forfeited. Even with an independent policy, Switzerland is in a position to outperform if it again focuses on its strengths of flexibility and openness. The independent monetary policy has helped to keep inflation in Switzerland at a low level for decades. This and the diversification properties of the Swiss franc make capital cheaper in Switzerland by approximately 1.5 percentage points (interest premium).
Asian bond markets are growing healthily and Asian bonds are an essential component of any balanced and diversified portfolio. Over the last five years, Asian bond 4  issuances grew at a compound annual growth rate of more than 10%. Asian bonds now make up over 30% of the J.P. Morgan Emerging Markets Government Bond Index. Since last year, 2 Asian countries received rating upgrades, notably Indonesia to investment grade1. 5 . Asia is expected to remain the fastest-growing region in the world. The IMF places Emerging Asia at the top of the global growth league table, with average growth rates of 6.3% p.a. from now to 20222, outstripping expected outturns in the developed economies3 as well as all other developing regions. China and India, the two largest Asian markets, are expected to grow by 6% p.a. and 7–8% p.a. respectively, while activity in the ASEAN-5 economies is expected to expand at around 5% p.a.4. 6. The rosy outlook translates to two significant implications for capital markets:  a. On the demand side, relatively favourable demographics, the emergence of a rising middle class and rapid urbanisation will stimulate more savings and investments; b. On the supply side, there is much scope in Asia to improve infrastructure, technology and innovation, the success of which will go a long way toward raising productivity and incomes even further. To finance these important structural needs, Asia’s ability to raise long-term capital for sustainable growth would make cross-border capital market activities even more important.

In May, the National Highways Authority of India issued the largest offshore rupee denominated bond to date and listed the bond on the Singapore Exchange. The INR 30 billion (USD 465 million) bond will be used to finance road network development in India. There is a well-trodden path for issuing offshore rupee denominated bonds out of Singapore, including NTPC Ltd and Indiabulls etc., and follow the journey that we are on with the offshore RMB bond market. III. Channelling capital towards catalysing adoption of sustainability practices Alongside the greater push towards the mainstreaming of green financing, we are witnessing an unprecedented surge in green bond issuances, globally and in Asia. Over 12.  the last five years, global green bond issuances grew over 150% to reach USD 845 billion in 2016, with Asia contributing around 40% of that. The market continues to register strong growth in 1H2017, with over USD 606 billion in issuance. 13. Singapore is building a sustainability-focused financial sector. We have placed great emphasis on capacity building to ensure that our financial institutions understand the technicalities of sustainability standards. As an example, the Investment Management Association of Singapore (IMAS) in April 2017 issued a public statement endorsing its commitment to sustainability considerations and expressing support for global and local standards such as the United Nations Principles for Responsible Investment (PRI) and the Singapore Stewardship Principles for Responsible Investors (SSP) in April 2017.