samchain/econo-pairs-v1 huggingface dataset:
However, Hong Kong does enjoy the first mover advantage over the others in a number of ways. Over the years, the HKMA has built up a very good working relationship with the Mainland authorities. We have accumulated a wealth of operational and regulatory experience in RMB business. We have also developed the most advanced financial infrastructure for RMB transactions with cross-border links with the Mainland. These are some of our unique strengths, and it is not easy for others to replicate them, at least in the short term. 28. With all these developments, where should we go next? At the policy level, I believe it would be important to build an effective two-way channel to increase interaction between the RMB onshore and offshore markets. A potential area that can be explored is to allow such real economic activities as FDI and ODI to be possibly settled in RMB in a gradual and controllable manner. If this can be done, offshore RMB liquidity can be channelled back to the Mainland in the form of FDI to support Mainland’s economic activities, while in the opposite direction, Mainland enterprises can make use of RMB for the settlement of ODI to eliminate foreign exchange risk. Given the significant share of Hong Kong in Mainland’s FDI and ODI, building such a two-way channel will also be conducive to the sustainable development of the offshore RMB market in Hong Kong. 29. In addition to FDI and ODI, we have been in close communication with the Mainland authorities to explore other possible channels.

Moreover, there is a second reason for stressing the difference between the three types of response, which is that both the measures seeking to prevent the recurrence of a similar crisis, and those seeking to increase the future resilience of the financial system are usually of little use in resolving the problems that affect economies and financial systems in the short term, that is to say now. The authorities naturally wish to “sell” the decisions they are adopting. But nobody should think that the immediate application of the measures aimed at preventing future crises or mitigating their intensity will suffice to resolve our short-term problems. If we analyse the matters addressed on the FSB or European Commission’s agendas, we will see that, until relatively recently, most progress has been centred on preventing the repetition of a crisis such as the current one, which has affected the entire financial system. And in the case of a fresh crisis arising, the aim has been for the financial system – for banks and for the authorities – to have resolution mechanisms that mitigate its adverse effects. With sole regard to the management of future crises, although major efforts have been made to move towards more effective crisis-resolution arrangements, most of the prescriptions admittedly require time to be effectively set in place, meaning that they cannot be used to manage the current crisis. Returning to the management of the euro area sovereign debt crisis, much progress has clearly been made in the reform of European governance.
Regarding monetary policy, the Board estimates that the monetary stimulus will remain as it is and will begin to be reduced as macroeconomic conditions continue to drive the convergence of inflation to 3%. As a working assumption for the monetary policy rate, for the short term we assume a trajectory similar to that shown in the Financial Brokers Survey available at the close of this Report. For the medium term, the Board continues to estimate that the monetary policy rate stand around its neutral level towards 2020, which it believes to be between 4% and 4.5% (Figure 13). As usual, there are internal and external elements that could modify these projections. The same as in March, from the point of view of its impact on domestic activity, the balance of risks in the external scenario is biased to the downside. The main risk on this front continues to be an abrupt deterioration of external financial conditions, especially in a context in which markets seem to be more reactive to negative news. Developments in the United States economy are important in this area, particularly because a more marked increase in inflationary pressures may require a faster rise in the federal funds rate. Nor is it possible to rule out that in an environment of lower appetite for risk, news of different signs may result in increased volatility. Risks also persist coming from trade policy measures promoted by the United States, considering the renewed tensions with its main trading partners.

According to the academic literature, when interest rates are close to zero, non-conventional monetary policy may come in three different forms: first, management of agents expectations through a commitment by central banks to keep interest rates low for a long period of time; second, increasing the balance sheet of the central bank; and, third, changing the composition of assets in the balance sheet of the central bank. The FED, the Bank of Japan and the Bank of Canada, have made use of the first kind of instruments aimed at managing expectations. Therefore, they have made announcements about the future path of interest rates to affect the agents’ expectations about long-term rates. However, the non-conventional monetary policies more widely used since 2008 have been of the second and third kind, that is, the ones affecting the size and composition of the central bank’s balance sheet. In the euro area, the ECB changed its liquidity tenders to a fixed-rate system, with unlimited amount. In order to remove uncertainty, it increased their maturity up to three years. It also set up a program to purchase covered bonds and introduced the Securities Market Program and the Outright Market Transactions Program to ensure proper transmission of monetary policy during the shocks of the sovereign debt crisis. The Securities Market Program was not a quantitative easing instrument, since purchases were later sterilized.
In the final analysis, it only works if the bank liabilities are flowing into a central bank that has the duty, willingness, and capacity to recycle them against collateral and expand its balance sheet as needed. The question therefore arises whether national deposit insurance systems should cover domestic deposits only and the payout should likewise be in domestic currency only, even for foreigndenominated deposits. In closing, let me note that the saga of the financial crisis in Iceland and its interaction with the European and global financial system is a complex one. My remarks today have only given you glimpses here and there. But as with other sagas, Icelanders will be writing about this for decades, if not centuries, and I think we can be confident that they will be better at writing about it than at running and supervising cross-border banks. Thank you very much. BIS central bankers’ speeches  5

With this requirement, my wish is that it will provide an impetus to the attainment of the chartered banker qualification. Second is Character. If competence represents the ‘head’ of a professional banker, then character must surely be the ‘heart’. Over the last decade, the ethical scorecard of the financial sector was blemished by irresponsible risk-taking and opaque practices of bankers in the lead up to the global financial crisis. Ethical lapses and conduct failures in more recent years have compounded matters. Far too often, we witness the rise of bankers who are highly competent but ethically deficient. Worse, we allow and tolerate such practices. This is unsustainable. It also tarnishes the reputation of the many who spent their lifelong careers in the industry, and who hold the profession with great dignity and regard. Another principle worth attention in the Hippocratic Oath is the adage, “Do no harm”. There is a lot of richness in this ethos. It is worth emulating. Considering that consumers come into contact with banking personnel far more frequently than they visit their doctors, one may even argue a higher expectation ought to be applied for the banking industry. The Bank has actively worked towards reinforcing this objective over the years. The Bank believes that when the right set of fundamental principles is followed, it can positively shape the 2/4  BIS central bankers' speeches  actions and behaviour of people. Therefore, the Bank, in consultation with the industry, is due to publish five universal ‘Principles for a Fair and Effective Financial Market'.
Second, the first tightening move might itself provoke another taper tantrum characterized by higher bond yields and tighter financial market conditions that could be sufficiently strong to impede the economic recovery. My judgment was that these risks were manageable. First, downside forecast errors are certainly possible, but the U.S. economy appears to be on sufficiently sound footing to withstand downside shocks better than was the case a few years ago. Second, I felt that the likelihood of a substantial tightening in financial market conditions due to lift-off was relatively low, in part, because the rate hike was widely anticipated. Market conditions had adjusted quite smoothly – except for some strains observed in the high-yield debt market – as market participants placed higher odds of tightening in the weeks preceding the December FOMC meeting. This reinforced that conclusion. A large market reaction would have been a surprise given that this was one of the most anticipated monetary policy events in history. Also, the policy action needs to be viewed in context. While this decision was the first upward adjustment BIS central bankers’ speeches  3  to short-term rates in nearly 10 years, the actual move was small – only 25 basis points – which, by itself, should have only a very mild impact on the overall trajectory of the economy. As we noted in the FOMC statement and as Chair Yellen pointed out in her December press conference, even after this rate hike, the stance of monetary policy remains accommodative.

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To create greater international awareness on these new initiatives, financial ambassadors are being appointed to meet with potential players and investors and road shows will be conducted as part of the promotional plan. In addition, the MIFC Executive Committee is formulating the supporting immigration policies with the Immigration Department where long-term employment pass, multiple entry permits, dependent pass and professional visit pass would be offered to expatriates identified as professionals and experts in Islamic finance. To attract specialist and high level expertise, a Permanent Resident status may also be offered based on the recommendation of the relevant financial regulators. A mechanism is also being put in place to ensure the efficient processing of these measures. This is aimed at addressing the acute current shortage of such talent and expertise in the global financial system. While the education infrastructure has already been put in place to address this shortage, Malaysia also needs to be competitive in attracting and retaining the talent. The Executive Committee will therefore look into customised incentives to attract best talents to Malaysia in addition to the entry of international legal firms that are able to provide services for the international currency business in Islamic finance. Role to be played by financial institutions One of the key success factors for a vibrant financial hub is having the critical mass of reputable and diversified range of financial institutions. With extensive incentives and measures in place, it is a priority for those already based in Malaysia to be encouraged to be the players in the MIFC.

Zeti Akhtar Aziz: Malaysia as an international Islamic financial centre Keynote address by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the dialogue with industry participants on MIFC (Malaysia International Islamic Financial Centre), Kuala Lumpur, 1 November 2006. *  *  *  The MIFC initiative was launched on 14 August 2006 amidst strong foundation and steady performance of the Islamic financial industry. It marks the beginning of a new era for the future landscape of the Islamic financial system in Malaysia. Several landmark measures were announced to initiate the MIFC agenda. It is to set the stage for Malaysia to position itself as a centre for the offering of Islamic financial products and services in international currencies to the global and domestic financial community. This presents new prospects and business considerations for financial institutions to realise the potential of evolving a vibrant Islamic financial hub. Today's dialogue, the first of its kind among key stakeholders, is aimed at promoting greater awareness on the initiative, to discuss implementation issues and to foster greater collaborative effort for the MIFC's overall success. We have with us here today the members of the MIFC Executive Committee, the country's high level coordinating body that has been set up to advance forward this national agenda. Objectives of MIFC This national agenda aims to achieve several major objectives.
R Jayamaha: Basel II and operational risk Keynote address by Dr R Jayamaha, Deputy Governor of the Central Bank of Sri Lanka, at the 10th SEACEN-FSI Regional Seminar for Bank Supervisors and Regulators, Colombo, 12 December 2005. *  *  *  It is indeed an honour to have been invited to deliver the keynote address at this SEACEN - FSI Regional Seminar for Bank Supervisors and Regulators on the implementation of Basel II and Operational Risk. I would like to take this opportunity to share some thoughts on this important subject, which is currently engaging the attention of the Bank regulators, not just in our region, but worldwide. I will first deal with why Basel II requires a separate capital allocation for operational risk and what it intends to accomplish. Next, I will discuss how Basel II deals with operational risks and how it contributes to financial system stability. Finally, I wish to mention a few steps regulators can take in preparation for adopting Basel II and mitigating operational risk. 2. Deregulation and globalization of financial services, together with the growing sophistication of financial technology are making the activities of banks and their risk profiles more complex. In this context, not only well known credit, interest rate and market risks, but also other risks can be substantial and threaten the stability of a financial system. A growing number of high-profile operational losses worldwide have led banks and supervisors to increasingly view operational risk as an integral part of risk management policy.

According to the Basel Committee on Banking Supervision, operational risk is the “risk of loss resulting from inadequate or failed internal processes, people and systems or from external events”. This definition is based on the underlying causes of operational risk at the broadest level and includes legal risk, but it excludes strategic and reputational risks. The Basel Committee has also asserted, “the most important types of operational risk involve breakdowns in internal controls and corporate governance.” That’s why Basel II aligns with a variety of other regulations and supporting frameworks for enhancing corporate governance. 'Management of operational risk is thus taken to mean the 'identification, assessment and / or measurement, monitoring and control of mitigation of this risk. While many of these risks are inherent and visible in day to day operations of banks, some components are applicable to supervisors and regulators. 4. The banking industry’s awareness of operational risk and efforts to manage it have accelerated in recent years, driven in part by an increasing desire to improve operating efficiency, reduce earnings volatility, rationalize the allocation of capital between competing businesses. It is not easy to get banks to identify and assess the operational risk inherent in all material products, activities, processes and systems and in particular to follow such practices when new products are introduced.
Second, that the Committee has been not open enough. Let me start with the first criticism. From its first meeting in June 1997 to the end of that year, the Committee was unanimous on all six occasions. Output appeared to be above trend, the labour market was continuing to tighten, and there was a need to slow the growth of domestic demand in order to reduce pressure on supply capacity. Interest rates were raised at each meeting between June and August, and again in November. At that point the Committee was accused of acting like a “politburo”. But in January 1998 the first disagreement occurred. The Committee voted by five votes to three (the ninth member, John Vickers, did not join the MPC until June of last year) to hold interest rates constant. In February and March the Committee was evenly divided, and the Governor used his casting vote in favour of an unchanged level of interest rates. Disagreements continued and in June the Committee voted 8 to 1 to raise interest rates for, as it turned out, the last time in that interest rate cycle. By now, many commentators were disillusioned with the evidence of disagreements within the Committee. If I single out Philip Stephens from the Financial Times it is only because his description, written in July 1998, of unhappiness with the Committee was more vivid and articulate than most. He wrote:  5  BIS Review 63/1999  “The Committee has thus far lacked both leadership and predictability.

But we cannot rest on our laurels. There is still much to learn and to change. Economic theory moves forward and economic behaviour is never constant. The practice of monetary policy must keep up. But what we will not change is our commitment to monetary stability and to the achievement of the Government’s inflation target. It is that commitment which can deliver economic stability to this country. BIS Review 63/1999  10
While regulation must not front-run innovation, regulators must run alongside innovation •  We must know what’s going on and be ready: either to promote or to restrain. There are three ways in which MAS does this. One, we actively engage FinTech firms to better understand emerging innovations and help them design their solutions for financial services. Take for example cloud computing. •  •  Our traditional approach was to deal only with regulated FIs, not their service providers –  But with cloud solutions proliferating, we changed tack  –  Many of these solutions offered strong efficiencies and cost savings but not all models met our regulatory requirements for data integrity and protection. So we engaged in dialogue directly with cloud service providers to explain our concerns and at the same time understand the technology –  The service providers then came up with solutions that met our concerns  –  And we modified our requirements to take account of new business models and technological capabilities. Two, we allow our FIs to experiment with new technologies in a safe environment. FIs do not have to seek MAS’ permission to try new things. •  Responsibility lies with boards and management to assess the risks and put in place adequate safeguards  •  But with many innovations, it is not always possible to anticipate every vulnerability or whether there is a risk of breaching regulation. •  Sometimes, as Nike puts it, you have to “just do it”.

The sum of the economies of all the new member states does not presently amount to more than the GDP of the Netherlands. Furthermore, historically high inflation rates in the acceding countries have been reduced through reinforced macroeconomic discipline (which in turn owes much to the enlargement process). A simple calculation shows that even if growth in the acceding countries averages some 4 per cent more than the euro area, and this catch-up, according to most estimates, generates Balassa-Samuelson price convergence with 2-3 percentage points higher inflation than euro economies, their inclusion in the euro area would still only add some 0.2 percentage points to area-wide inflation. Instead, it is the perspective of the acceding countries themselves that is crucial. Risks with ERM II The one risk with ERM II that has been discussed at length in recent years is the potential conflict between a pegged exchange rate and an inflation target. Both exchange rate stability and low inflation are necessary to fulfil the conversion criteria, but in some cases it may be difficult for monetary policy alone to meet two targets at the same time. One possible situation is that the central parity has been set too low and that real appreciation pressures, due to catching up, are so strong that the upper band comes into question. This can result  BIS Review 53/2003  1  in large-scale speculative currency flows and unnecessary turbulence, as demonstrated by the attack on the forint at the beginning of this year.