samchain/econo-pairs-v1 huggingface dataset:
Moreover, new players can have better access to the market, which can improve market quality and strengthen competition. 7 So what is the situation in Sweden? American credit derivatives have not had Swedish owners to any considerable extent. Neither is there a Swedish credit derivatives market of any size. This is mainly because the Swedish market for corporate bonds is small and without corporate bonds it is hard to trade in credit derivatives. So the problem with American credit derivatives that are traded over-the-counter does not exist in Sweden. That does not dissuade us from reviewing the Swedish securities market in the light of the problems that have been identified in the American market. 4  Securities trading can be arranged on an established market or over-the-counter; in the latter case, the parties to the transaction settle it on their own. 5  Netting involves offsetting transactions against each other with a view to making the transactions cancel out as far as possible. 6  The Riksbank and Finansinspektion (the Swedish Financial Supervisory Authority) evaluate NASDAQ OMX Derivatives Markets in accordance with the international standards in Recommendations for Central Counterparties, published by CPSS and IOSCO. 7  For more information about electronic trading, see The implications of electronic trading in financial markets, Report by a working group established by the Committee on the Global Financial System of the central banks of the Group of Ten countries, Bank for International Settlements, 2001.

Given the famous  Page 10  ‘long and variable lags’ in monetary policy transmission, it is the persistent component of inflation – that component of inflation that will still be there once the lags in monetary policy transmission unwind – that is the relevant object for the MPC’s attention. But judging inflation persistence in real time is difficult. By its nature, a persistent series does not change much from one MPC meeting to the next. Such relatively high frequency month-to-month fluctuations cannot be the main driver of a series whose evolution must be dominated by lower frequency dynamics, if it is indeed to be persistent. In coming to an assessment of inflation persistence, the MPC has emphasised the importance of domestic price and wage setting behaviour, since this has historically proved to be more persistent that external drivers such as commodity price shocks. This has naturally led to a focus on wage developments, on services price inflation and – as new data sources, such as the Bank’s Decision Maker Panel, have become available – on corporate pricing behaviour as key indicators of inflation persistence, and thus in turn of the prospects for monetary policy. This focus is evident in the analysis present in the MPC’s recent Monetary Policy Reports, and in the indicators highlighted in the MPC’s published minutes and policy summary. But there is no single indicator that can adequately summarise the ‘instantaneous persistence’ of inflation.
Ardian Fullani: How the financial crisis has impacted central bank cooperation and EU economic, financial and regulatory developments Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the high-level conference “On international central bank cooperation before, during and after the crisis”, hosted by the European Central Bank, Frankfurt am Main, 9 December 2013. *  *  *  Dear Participants, It is an honor for me to participate in this important conference and I want to thank the organizers for inviting me. In my speech I will focus on how the recent financial crisis has changed the central bank work with respect to the adoption of macro-prudential policy and its relationship with monetary policy. Then I will share some thoughts on the experience of SEE countries during the crisis, and highlight some of the challenges they face given the recent economic, financial and regulatory developments in the EU. The crisis we are going through, being so profound and lasting, will leave its mark on economics in general, and central banking in particular. Up until the Great Recession, monetary policy was living in a world that we may call “the inflation targeting era”. In many ways inflation targeting made the central bank’s job relatively simple, as long as it followed the policy correctly. The Central Bank, seen by the public as an independent institution, had to credibly commit to an explicit inflation target, in order to anchor mid-term inflation expectations.

Let me conclude my speech with the words of Ivy Baker Priest, former Treasurer of the United States between January 1953 and January 1961. "The world is round and the place which may seem like the end may also be only the beginning", Ms. Priest said. The idea of this quotation may appear as a truism but it is relevant for today's state of the financial system. It may prove to be the key lesson to learn from "today's" crisis unless it may have been the lesson that mankind thought it had already learned every time a crisis occurred. BIS Review 56/2009  5  References: 1. The High-Level Group on Financial Supervision in the EU report, chaired by Jacques de Larosière, Brussels, 25 February 2009. 2. London Summit – Leaders' Statement, 2 April 2009. 3. Jean-Claude Trichet, President of the ECB, Introductory remarks, Brussels, 30 March 2009 (Hearing before the Economic and Monetary Affairs Committee of the European Parliament). 4. Mugur Isărescu, Criza financiară internaţională şi provocări pentru politica monetară din România, Cluj-Napoca, 26 February 2009. 5. Mugur Isărescu, Criza financiar-bancară şi economică: strategii, programe şi măsuri anticriză. Implicaţiile şi perspectivele unei agende naţionale, Braşov, 6 March 2009. 6  BIS Review 56/2009
In large part, and according to the analysis of the ratings agencies, these downgrades are due to the fact that as a country we have not yet taken the fiscal consolidation measures that our government and our parliament agreed were necessary to implement last year. It is a very costly delay as it raises the cost of financing of our public debt, it raises the cost of financing by private business, and it reduces employment and growth opportunities. There are things that can be done in order to reverse this. The policies that could reverse this deteriorating situation are well known, and they involve shoring up the long-term public finances of the Republic. So I repeat, all authorities must live up to their responsibilities. Q. Would you give me specific examples on how you believe the structural problems in the Cypriot economy can be addressed? We hear a lot about fiscal consolidation but what exactly should be done? I could mention a couple of the things that were already agreed by our parliament and government last year which unfortunately have not been implemented as of yet, with the associated damages from the delay. The most obvious I believe, because it has been repeatedly mentioned, is the sustainability of our pension system.

Since the CDFIs have the relationships with the small businesses, partnerships between banks and CDFIs that increase the lending capacity of the CDFIs could be helpful. Possible avenues to achieving this include partnerships between CDFIs and banks, as well as assisting CDFIs to better access funding from the Federal Home Loan Bank (FHLB) system. I would like to touch on three additional issues that I think would assist small businesses to be successful: financial education, certification of community organizations that assist small businesses and greater transparency for small business lending. Establishing a thriving small business takes more than a good idea and hard work. While both of these are essential, there are many other factors that come into play. It is important that people starting businesses have access to financial information that will assist them in navigating the difficult way forward. This assistance can include how to develop a sound business plan, how to enhance their credit profile, how to avoid early pitfalls such as obtaining financing with punitive interest rates and how to cultivate a banking relationship. These will all increase the likelihood that the small business will have access to the credit it needs over time to grow and thrive. CDFIs have been an important source of this financial education to small businesses, and these efforts should be supported and expanded. It is critical that small businesses also know that the organizations they work with are reputable and knowledgeable.
This has been confirmed in an ECB assessment of Malta’s monetary and exchange rate policy in connection with the Pre-Accession Economic Programme Report for 2002, where it is noted that the current regime has served Malta well in promoting real and nominal convergence. In view of these considerations, and given the importance which exchange rate stability has for trade and investment, the current regime remains the preferred arrangement for Malta. Taken together, therefore, the institutional arrangements governing ERM II and the successful experience with the current fixed exchange rate regime suggest that the way forward will consist of a gradual reduction in the weight of the US dollar and sterling in the currency basket, such that by the time Malta will be ready to join ERM II the euro will be the sole reference currency. If the United Kingdom were to join EMU in the meantime, this would automatically raise the proportion of the euro in the currency basket, making the approach to ERM II that much easier. Consistently with this objective, the weight of the euro in the basket was increased from 56.8% to 70% last August. BIS Review 70/2002  3  Given that Malta’s optimal exchange rate strategy in the run-up to ERM II has been identified, the next question concerns the choice of the central exchange rate and the fluctuation bands. The choice of the central exchange rate and fluctuation bands Some might argue that the choice of the central rate is not vitally important.

BIS Review 65/2010  1  After the foundations for a potential turnaround became discernible, the policy debate turned to the appropriate exit strategies from these expansionary policies. In the case of monetary policy, the central banks of the main developed countries have already announced – and begun to implement in some cases – plans to withdraw their unconventional liquidity-support measures. In the case of fiscal policy the challenge is successfully to apply fiscal consolidation. That will require a significant effort if public finances are to be set on a sustainable path. However, it is also time to shift our focus from the short to the medium and long run and start to address the structural problems of our economies. There are several arguments justifying this need for a shift in policy perspective. First, the historical evidence suggests that output may remain well below pre-crisis trends in the medium run. The associated losses in capital, employment and total factor productivity during the crisis could be long-lasting, leaving an enduring imprint on productive capacity. And medium-term output dynamics may also be affected. In particular, investment has fallen dramatically in the crisis, resulting in a slowdown in the rate of accumulation of productive capital. This, when combined with higher rates of capital obsolescence, is lowering potential growth in the short to medium run. In addition, these adverse effects could persist in the long run if there is a permanent step-up in the cost of capital due to changes in attitudes towards risk among investors.
Ripple  This PoC explored the synchronisation of two different fiat currencies between two simulated RTGS systems built on the cloud. We wanted to understand the impacts on settlement risk, speed and the efficiency of cross-border payments. Completed  Experimentus ORB  We applied the firm’s tool to historic projects to visualise how they had performed against a range of standard key performance indicators. Completed  Distributed ledger technology  Data analysis Distributed ledger technology  Cohort 4  Company  Chain  Data analysis  Reportix and NTT Data  Machine learning  Digital Reasoning  This PoC is intended to explore how distributed ledgers can be configured to enable privacy amongst participants whilst keeping data shared across a network. This partnership of firms will investigate innovative storage solutions for regulatory reporting data. In particular, the processing and storage of XBRL based data to facilitate analysis and visualisation. In this PoC we want to understand the sentiment in a sample of publically available unstructured text data and how this might support the work of our supervisors. Completed Completed  In progress In progress In progress  Machine learning  Mindbridge Analytics Inc  This second phase PoC will examine the ability of the tool to analyse larger data sets and a broader range of classification schemes and learning algorithms. In progress

On the demand side, economic activity relied mostly on foreign demand and public spending, while private sector contribution was low. Indirect data support the assessment for a weak private consumption performance during 2011 H1. In spite of increased available income and improved bank lending – as indicated by higher employment, real wage and consumer and house-purchase loans – consumer confidence was low. The Albanian consumer continues to be cautious in spending, displaying added saving preference over a number of quarters. Naturally, this behaviour is a structural correction of the consumption model shown over the past years, but the slow performance of consumer spending reflects, also, added uncertainty about the future. While the first component is welcomed, in the context of preserving macro- and micro balances, the second component may and should be corrected: households consumption has the potential to grow and be stimulated in the short and medium run. Taking into account the significant impact of consumption on the GDP, its performance will substantially condition economic growth during this time span. 2  BIS central bankers’ speeches  Private investments increased at moderate pace during 2011 H1 as illustrated by higher loans for investment and imports of capital goods. Although financial terms – availability, liquidity and bank interest rates – are significantly improved, the existence of spare capacities in the economy limits the demand of businesses for investment. In the short run, the position of economic activity operating below its potential conditions a slow performance of investments.
Because of this, the monetary policy transmission mechanism has been somewhat disturbed, as Iceland is more susceptible to contagion from low global interest rates at a time when financial conditions and the banks’ liquidity are changing. Some might say that these represent challenges rather than a crossroads. I prefer crossroads as a metaphor, however, because in all of these instances the economy is moving from one state to another. This certainly poses challenges for monetary policy and for all economic policy. But they are compounded by the fact that the economy is travelling through all of these crossroads at roughly the same time, and the challenges often interact in a manner that makes monetary policy formulation and conduct more problematic than usual. This will become clearer after I have described each of the crossroads more fully. The first one is growing demand pressures in the domestic economy. According to the Bank’s forecast, published yesterday, GDP growth in 2015 and 2016, measuring 4.6% and 3.2%, respectively, will exceed growth in potential output. The sizeable slack that developed during the economic contraction ending in 2010 was gradually absorbed between 2011 and 2013. Measured productivity growth has been negligible or non-existent and GDP growth therefore labour-intensive. As a result, unemployment has declined rapidly and demand pressures have developed in the labour market. According to the forecast published yesterday, the positive output gap is expected to peak next year at 1½% of GDP. Domestic demand will grow well in excess of GDP during the forecast horizon, which extends into 2018.

It should be borne in mind that this forecast entails an endogenous tightening of the  BIS central bankers’ speeches  3  monetary stance as the positive output gap widens and inflation rises. The Monetary Policy Committee’s decision to raise Central Bank interest rates by 0.25% must be viewed in this light. The final crossroads is the most important: the resolution of the balance of payments problem and the liberalisation of the capital controls. It has long been clear that taking this step would entail numerous challenges for monetary policy. Two in particular have been focused on. The first is that the banks’ liquidity position could deteriorate as a result of the liberalisation of the capital controls. The Central Bank has mapped out the potential scope of these effects, as was presented when the settlement of the estates on the basis of stability conditions was announced recently. The result is that the change in liquidity will be within manageable limits. This does not change the fact that the banks must proceed with caution in coming months and protect their liquidity position throughout the process. In support of this, the Central Bank recently increased minimum reserve requirements. The intention is to reverse the change in reserve requirements when the strain on liquidity is at its peak. The latter is that before capital controls on residents are finally lifted, we must implement a monetary policy framework different from that pursued before the crisis.
In some advanced IT countries, the correlation of changes in domestic long-term interest rates with US rates was very strong (over 90%), at the same time as the correlation of domestic short-term rates with long rates was weak – and even non-existent, if lags were taken into account. The GFC reversed this process somewhat, as risk premia skyrocketed, cross-border banking retreated back to home base, and restrictions on capital movements were in some cases reintroduced. But it has come back to a significant degree. There is an important caveat here, which is that the observed patterns could have other explanations. Thus co-movements in asset returns could be due to common shocks and the low level of correlation between short and long rates due to monetary policy credibility. Looking at the totality of the evidence and case studies, however, it seems difficult to escape the conclusion that global financial integration was a big underlying driver, although there were also other factors at play. New Zealand appears to be a relevant example here. During significant parts of the 2000s – before the GFC – the policy rate in New Zealand was raised to counteract demand pressures at the same time as the US maintained an easy stance. New Zealand’s long rates were flat or falling for most of this period. I could tell a similar but slightly more complicated story from my own country.

Figure 4 Price of electricity (annual change, percent) 60  60  50  50  40  40  30  30  20  20  10  10  0  0  -10  -10  -20  -20  -30  -30 05  06  07  08  09  10  11  Source: National Statistics Institute (INE). 8  BIS central bankers’ speeches  Figure 5 Output growth (quarterly change, percent) Chile (*)  World  8  8  6  6  4  4  2  2  0  0  -2  -2  -4  -4  -6  -6 05  07  09  11  2  2  1  1  0  0  -1  -1  -2  -2 05  07  09  11  GDP Domestic demand Domestic demand w/o inventory change  Figure 6 Growth forecasts for the year 2009 (1) (annual change, percent) 8  8  5.9  6  6  4  4  2  2  0  0  -2  -1.7  -4  -2  -1.7  -4  -4.7  -6 Chile  Dev. economies (2)  Latin  America  Emerging Asia  Emerging  -5.2  -6  Europe  (1) Consensus forecasts from January 2008 to December 2009. For emerging Asia, forecasts are available as from March 2008. Black bars show actual growth in 2009.
The FPC has also noted declines in the liquidity of key dealer-intermediated markets, and the Bank is contributing to an international review of repo market functioning by the Bank for International Settlements’ Committee on the Global Financial System, see Bank of England (2016). The FPC has also asked the Bank to complete an in-depth assessment of financial stability risks associated with derivative markets. This will examine progress towards implementation of the post-crisis reforms to these markets and consider implications for the resilience of the financial system. 41 International Monetary Fund (2011) discusses the risk that macroprudential policy would be subject to biases toward inaction or insufficiently timely action, given that the benefits of policy interventions can appear uncertain while the costs are often felt more immediately. 42 The policies introduced by the FPC in 2014 to guard against risks from the mortgage market do not apply to re-mortgages with no change to the principal amount outstanding. 43 In July 2016, the FPC became the first macroprudential authority in an advanced economy to cut the so-called countercyclical capital buffer for banks. That was consistent with the FPC’s intention to release the countercyclical capital buffer in situations where risks materialise, and to act pre-emptively before losses crystallise. This cut sent a clear signal that, if losses were to materialise, banks would be able to draw on their buffers, reducing any perceived need for banks’ to preserve capital and restrict lending, with consequent negative impacts on the real economy.

The valuations offered for redemptions were increasingly uncertain and – in some cases – lagging behind investors’ perceptions of falling property values. You’d be hard pressed to create greater incentives for your investors to cash in. Faced with overwhelming redemption pressure, many funds were forced to suspend. Even so, at least 18 per cent of the suspended funds’ assets under management – £ – had a for sale sign put up outside. Notwithstanding the recent signs that the market has stabilised, I welcome the Financial Conduct Authority’s action to open up a public discussion of the challenges associated with funds that invest in illiquid assets and offer short notice redemption. 27  The impact of firesales depends crucially on whether there are others out there willing to buy. The firesale feedback loop can be made more pernicious as ‘liquidity providers’ – the market-makers and active investors – step back at the same time as others are selling into the market. In recent years, market-making dealers have been less willing to see their inventory of securities rise – a preference likely to become more pronounced in times of higher volatility. 28  And insurance companies and  pension funds can face incentives to step back as the value of their assets falls towards their liabilities. 29  7  All speeches are available online at www.bankofengland.co.uk/speeches  7  Such behaviour is very understandable from the perspective of the individual company.