samchain/econo-pairs-v1 huggingface dataset:
The key policy rate influences interest rates on interbank loans. Banks’ deposit and lending rates and bond yields depend on the current key policy rate and expectations as to future changes in this rate. Lending rates in state banks are also linked to the interest rate on interbank loans and bond yields. The aim of preventing inflation expectations from becoming entrenched below the operational target of 2.5 per cent was one of the main reasons the interest rate was lowered to a very low level in 2003 and 2004, when inflation receded and approached zero. Low interest rates have stimulated demand and output and gradually led to the prospect of higher inflation, which we are addressing by increasing the interest rate. The labour market is an important factor in how the interest rate functions. A rise in the interest rate curbs aggregate demand for goods, services and labour, and eases the pressure on wages and prices. These effects are amplified by the impact of the interest rate on the krone exchange rate. Higher interest rates contribute in isolation to krone appreciation and to lower profitability in the internationally exposed sector. This can result in lower employment and wage growth in this sector. Expectations with regard to price developments  2  BIS Review 139/2007  also influence wage demands and have an effect when companies adjust their prices. The inflation target can provide an anchor for these expectations.

But costs are increasing for all types of building and construction. Each million allocated over central and local government budgets now buys considerably fewer square metres of building and fewer metres of road. Strong economic growth has so far only to a limited extent fed through to a higher rise in prices for consumer goods and services. Lower electricity prices have contributed to a fall in total CPI inflation in 2007. Consumer prices adjusted for tax changes and excluding energy products were stable at between 1 and 1½ per cent for a long period. Underlying inflation has  1  See Elisabeth Fevang and Knut Røed (2006): “Veien til uføretrygd i Norge (The route to disability pensions in Norway)”, Report no. 10 2006, Ragnar Frisch Centre for Economic Research. Norwegian only. BIS Review 139/2007  3  edged up gradually since late summer 2006, and the most recent figures indicate that it now stands at approximately 1½ per cent. Developments in recent years have paved the way for strong growth in employment, even now that the cyclical upturn is in a mature phase. The labour market is tight. Unemployment has not been as low since the latter half of the 1980s, and employment has risen faster this year than in living memory. It is estimated that the number employed will increase by 3.5 per cent this year, which would be the strongest rise recorded in the post-war period. The number of vacancies per unemployed has never been higher.
Dimitar Radev: The Bulgarian banking sector in 2020 – how have we coped and what is forthcoming Publication by Mr Dimitar Radev, Governor of the Bulgarian National Bank, in the Bulletin of the Association of Banks in Bulgaria, issue 64, December 2020. * * * Dear Colleagues, We are approaching the Banker’s Day in a year of unprecedented challenges: first, in relation to the consequences of the COVID-19 pandemic; andsecond, with the completion of the strategic project of the entry of the Bulgarian Lev into the European Exchange Rate Mechanism (ERM II), simultaneously with the accession of our country to the European Banking Union, including to the Single Supervisory Mechanism and the Single Resolution Mechanism. From the banking sector’s perspective, there are two key questions: how we have coped to date, and what is forthcoming? Our goal, defined as early as the start of the crisis, was for the banking sector to generate solutions, rather than problems. As a result of our effort in the recent years, we were well positioned for the attainment of this goal. The banking sector ‘entered’ into the crisis with a Common Equity Tier 1 capital adequacy of over 19%, and with a liquidity coverage ratio of over 260%, i.e. times above the regulatory requirements. Regardless of the good starting position, we were aware that, because of the abrupt deterioration of the environment in which banks operated, there should be new measures for further strengthening of their capital and liquidity positions.

As a result of joining the Single Supervisory Mechanism, our country also joined the Single Resolution Mechanism. From 1 October 2020, the European Central Bank exercises direct supervision over five Bulgarian significant credit institutions, and the Single Resolution Board assumed the function of a resolution authority for these institutions and for all cross-border groups. Owing to the good preparation effort, the transition to the new supervisory regime was smooth, without any turbulence for the banks and their customers. 1/3  BIS central bankers' speeches  Therefore, the answer to the first question is that up to now we have been successfully performing both the emergency tasks caused by the pandemic and the strategic tasks facing the banking sector. The Banker’s Day is a good opportunity for us to mention the contribution and to commend on and give recognition to all our colleagues for having a banking sector that is just as strong and supportive of companies, households and the entire economy, with a preserved general financial stability in the country. The more important question for us now is what lies ahead? There is no easy answer to this question because of the development of the crisis which makes it much more uncertain in terms of parameters as compared with previous historical periods of economic and financial turmoil. The second wave of rapid spread of COVID-19 and the new phase of the restrictive measures are once again challenging a number of sectors.
As the Vice Chair of the Supervisory Board of the Single Supervisory Mechanism recently stressed, for example, “both banks and supervisors must prepare for any potential scenario”. 12  12  ‘Introductory statement to the press conference on the ECB Annual Report on supervisory activities 2016’, remarks by Sabine Lautenschläger, Vice Chair of the Supervisory Board of the Single Supervisory Mechanism, 27 March 2017. 9  All speeches are available online at www.bankofengland.co.uk/speeches  9  Under one scenario, negotiations could result in a new statutory and regulatory regime with a large number of firms – currently either physically based in the UK or providing services within the single market via passporting arrangements – coming directly under PRA authorisation and supervision. In that case, we would need to form our own judgments, rather than relying exclusively on those of others. As our continental colleagues have observed in the analogous case of UK firms operating in Europe, these judgements could affect whether the firm operates as a branch or a subsidiary, as well as the range of services it can supply. Consistent with our current approach, and the PRA’s stance towards non-EEA branches, any judgements would reflect:   the cooperative and information sharing arrangements in place;    our confidence in the standards to which others are adhering; and    any assurances we have on arrangements to address circumstances when things go wrong.

So what were the issues facing the MPC two weeks ago? Remember that the aim of the MPC is to hit an inflation target of 22. Sometimes inflation will be above the target, sometimes below. But over a run of years the outturn should be as close to 22 as possible. It is central to our remit that deviations of inflation from the target are regarded symmetrically. Inflation can be too low as well as too high. For over thirty years, central banks have not, until recently, had many opportunities to show that they understand this. I can assure you that the MPC does. When circumstances change, as they have over the past few months, then so will our policy. The recent turbulence in international financial markets brings a new set of problems and risks, over and above those that resulted from the Asian crisis which started in the second half of last year. It is important to distinguish between the crisis of the so-called “tiger” economies in Asia, which, although clearly impacting on world trade, was indeed largely restricted to Asia, and the  BIS Review 86/1998  -2-  more recent financial contagion which has afflicted almost all emerging markets and affected the financial system of the industrialised world. There are three aspects of the world economy which are relevant to our own position. First, private capital flows to emerging markets have in many cases come to an abrupt halt.
Caleb M Fundanga: Financial market progress in Zambia Opening remarks by Dr Caleb M Fundanga, Governor of the Bank of Zambia, at the official launch of the Equity Capital Resources Unit Trust, Lusaka, 21 April 2008. *  *  *  Chairperson Distinguished Ladies and Gentlemen, Let me at the onset express my gratitude to Equity Capital Resources Plc for inviting me to come and officially launch its collective investment scheme which I understand will be called “Equity Capital Resources Unit Trust” or ECRUT in short. This indeed is gratifying to everyone who is anxious to see our financial markets progress. As many of you gathered here already know, the Bank of Zambia in consultation with various stakeholders initiated and developed the Financial Sector Development Plan (FSDP) in 2004. The vision of this Plan is to have a stable, sound and market-based financial system that supports an efficient mobilisation and allocation of resources. It is therefore pleasing that the introduction of ECRUT takes us closer to fulfilling the vision of the FSDP. Ladies and Gentlemen, am sure you will agree with me that collective investment schemes are an indispensable part of market development with several benefits. One of the primary benefits of collective investment schemes is that small investors can have access to professional investment management. Many of our people are not conversant with financial investment matters, yet they are eager to enhance their wealth. Many simply do not have the capacity to identify and manage investments that are appropriate to their risk-return appetite.

•  The central government budget – growth in public expenditure – influences the krone and the size of the internationally exposed business sector in the medium term. Government expenditure and revenues must be in balance in the long term. •  Wage formation, the structure of the economy and incentives determine how well and how efficiently we utilise our labour resources and other economic resources. There is also an interaction: •  In its budget resolutions, the government authorities will attach importance to the effects of the budget on the Norwegian economy and will therefore take account of interest rate effects. In this way, they avoid a situation where growth in public expenditure and the interest rate push the economy in different directions. •  With a known monetary policy response pattern, the parties to the centralised income settlements can take interest rate effects into account when wage increases are negotiated. •  Moreover, the parties to public sector negotiations can take into account that the higher pay increases are, the fewer people that can be paid over government budgets. The interaction here became clear when public sector employment fell after the expensive wage settlement in 2002. The value of the Petroleum Fund, measured as a percentage of GDP, will rise in the years ahead. On the other hand, Norway, like many other countries, is facing substantial fiscal challenges. The expected dependency ratio, i.e.
Central banks were born with the inception of fiat money – banknotes – and they have been pivotal for the take-up of non-cash payment instruments. Among the latter, a growing trend in the last few years has been the preponderance of electronic payments versus traditional paperbased ones – such as cheques – even if this trend varies across regions. This physical dematerialisation is actually ongoing, with the slow move away from dedicated form factors – such as plastic cards – towards entirely digitalised ones, for example solutions embedded in smartphones or other consumer devices. So, regarding money issuance, we have to monitor closely the latest technological innovations. Several central banks, including the oldest one – the Riksbank in Sweden –, have started to study the possibility of a digitallyissued central bank currency which could allow not only commercial banks but also the general public to access central bank money. Second, financial stability: payments are a key vector for trust and confidence in the adequate functioning of the financial system. This requires both secure and efficient payments and financial infrastructures. Therefore regulators attach importance to supporting technological innovations, including via the potential development of more efficient regulation or “Regtechs”, as long as they go hand in hand with low operational risks and high transaction safety. Third, economic services: payments are the nexus where a new ecosystem based on technological innovation and entrepreneurship is blooming.

François Villeroy de Galhau: Technological innovations in payments and beyond Opening speech by Mr François Villeroy de Galhau, Governor of the Bank of France, at the Bank of France and CNPS (French Payments Committee) conference "Technological innovations in payments and beyond", Paris, 6 January 2017. * * * Ladies and gentlemen, I am very pleased to welcome you all to Paris, for this conference on technological innovations in payments and, more generally, in the financial system. Representatives from a wide range of stakeholders, from market to regulatory spheres, are here today and I have no doubt that this variety of backgrounds will make the discussions fruitful. Before leaving the floor to the speakers and panellists, I would like to share with you a few thoughts on three challenges raised by digitalisation, from the perspective of a central banker. 1. Technological innovations are opening up new opportunities for payments, which can provide benefits to the whole economy Payments are often viewed as a very technical and incidental activity, and sometimes even just as a matter of “plumbing”. And yet they are crucial for our economy and for central banks. For the Banque de France, payments are of the essence in all our three missions – what we call the “3 Ss”: monetary strategy, financial stability and economic services. First, monetary strategy: what is at stake with payments is the future of money.
Trading volumes in SORA derivatives have continued to rise, doubling in the last quarter, albeit from a low base. In the cash market, adoption of SORA has broadened significantly. We have seen several sizeable SORA-based commercial loans involving early pathfinders such as CapitaLand, Olam, Wilmar and Sembcorp Industries. [3] Our local banks have also launched several business and retail SORA property loan product oﬀerings. Given the strong interest in SORA products, and progress made in kickstarting SORA market liquidity, SC-STS also announced that usage of SOR in new cash products will cease by April 2021. To support this, our key retail banks will lead the way by oﬀering a broad suite of SORA products by end-February 2021. Other banks active in SGD retail and corporate loans will follow suit by April 2021. Another significant development last year, was the industry decision to discontinue SIBOR by end-2024 [4] , to reap the expected benefits of enhanced market eﬀiciency in a SORA-centered interest rate benchmark regime. Implications of Recent ICE Benchmark Administration (IBA) Announcement 6 Let me now touch on what many of you in the audience would consider the ‘elephant in the room’. In December 2020, the IBA – or ICE Benchmark Administration, consulted on LIBOR discontinuation timelines across various currency settings. What caught most of our attention, was the proposed 18-month extension till 30 June 2023 of the widely referenced USD LIBOR tenors (the overnight, 1M, 3M, 6M and 12M).

12 While we recognise that there could be further changes pending the finalisation of IBA’s proposal, there was broad consensus within the Committee that we should keep building on the strong momentum generated over the past year. Let me share with you four key takeaways of the SC-STS, arising from these latest developments. 13 First, the proposed extension of LIBOR discontinuation means that SOR will end when LIBOR ends in mid-2023. This has two benefits: One, it will allow about 70% of existing stock of legacy SOR cash products [6] or about $ of bilateral and syndicated loans to mature before the new deadline. This is a good development, as financial institutions will have a smaller stock of legacy transactions to manage. Two, the extension provides time to do more to actively transition legacy SOR contracts to SORA, and to deal with the most challenging legacy transition issues. We seek to complete this transition as an industry by no later than end-2022. Stopping new use early 14 Second, it must still be the case that we stop adding to legacy SOR exposures as soon as practicable. Hence: There was unanimous support within the SC-STS to cease the use of SOR in new cash market products by April 2021, as originally announced.
However, following the EU enlargement with ten new countries, migration accelerated also in our part of the world, as illustrated in Table 3 below. In some cases, a significant part of national workforce took up employment in foreign countries. It is estimated, for instance, that ca. 5% of Lithuanians took employment in the countries that opened their labour markets to the new EU member states following 1 May 2004. 7  A thorough analysis that shows what services may be traded internationally is available in the study by Jensen B., Kletzer L. (2005) “Tradable Services: Understanding the Scope and Impact of Services Offshoring”, Institute for International Economics working paper, 5 - 9 September 2005. 8  The World Bank (2006) “Global Economic Prospects. Economic Implications of Remittances and Migration”, Washington DC, 2006. BIS Review 64/2006  5  Table 2. Number of work permits in the UK, Ireland, and Sweden, issued to citizens of new Member States in the post-accession period In % of workforce†  thousand UK*  Ireland**  Sweden***  Total  Lithuania  44.72  26.37  0.37  71.46  4.4  Latvia Estonia Poland The Czech Republic  23.03 4.68 204.90 20.01  12.94 3.39 70.14 6.39  0.16 0.36 2.16 0.07  36.14 8.43 277.20 26.47  3.2 1.3 1.6 0.5  Hungary  10.35  3.83  0.20  14.37  0.3  Slovakia  36.36  10.93  0.09  47.38  1.8  Source: Accession Monitoring Reports, http://www.ind.homeofice.gov.uk. Data for May 2004 through December 2005.

This means that more and more forms of activity will be generated by international optimisation of business processes. This in turn will force individual countries/regions to increase their attractiveness for the global business, which requires an active attitude of local selfgovernments. For instance, Dubai Outsource Zone is a government initiative, aimed to make Dubai a highly attractive international off-shoring/outsourcing centre. The concept of multi-off-shoring appears, where a decision on globalization of manufacturing entails starting business activity (routing orders) in several locations. There is a lot being said and written on the impact of globalization on the US economy, but there is a lot going on across Europe as well. Off-shoring of manufacturing and services to other countries is not the key reason for restructuring yet; however its significance grows year by year. The European Restructuring Monitor 15 website, at the end of 2005, contained a description of ca. 3500 cases of company restructuring in Europe, which has been announced in the media (international and national) since 2002. In the years 2002 - 2005 there were only 202 cases of company restructuring (i.e. 6% of total) which, as their main reason, reported the transfer of manufacturing or service abroad (that is colloquially called off-shoring), whereas in 47% the reason was internal restructuring, which could have partly resulted from the growing competitive pressure ensuing from globalization. The EU enlargement in 2004 led to significant changes in the off-shoring process across Europe.
Colleagues, Zambia’s external sector has also registered significant improvements over the last ten years, with notable surpluses recorded over the last five years. This was largely on account of higher growth in export earnings relative to import bills. Total merchandise export earnings have more than doubled over the last five years to 10.4 billion US Dollars in 2013 from 4.5 billion US Dollars in 2008. The increase was driven by a rise in earnings from both metal and non-traditional exports. Metal exports rose by 76.1% to 7.0 billion US Dollars in 2013 from 4.0 billion US Dollars in 2008 due to both improved prices and an increase in export volumes. Non-traditional export earnings posted a stronger growth of 283.6 % to 3.4 billion US Dollars from 900 million US Dollars over the same period. However, the current account surplus narrowed in 2013 as imports grew faster than exports. This is a normal trend in a growing economy as most of the imports are machinery and intermediate goods such as industrial boilers and equipment, petroleum products, chemicals and motor vehicles that are expected to enhance productivity and ultimately increase production. In the foreign exchange market, the Kwacha has been relatively stable in the last few years. However in 2013, the Kwacha was characterised by a depreciating trend against most major  2  BIS central bankers’ speeches  trade partner currencies, except the rand. The Kwacha depreciated against the US Dollar by 4.9% to an annual average of $ from $ in 2012.

The third panel, chaired by Duvvuri Subbarao, will take up the question of how to deal with these vulnerabilities. What are the appropriate policy responses, and what is the role for regulation and capital controls? One policy response has been the accumulation of reserves, which can provide a temporary shock absorber. However, reserve accumulation entails costs for the countries accumulating reserves as well as for the world economy as a whole. Our last panel, chaired by Masaaki Shirakawa, will discuss alternatives to self-insurance. An obvious question here is the role of IMF lending facilities. 2  BIS Review 65/2010  As already mentioned, the questions we address today are difficult and complex. Someone who played an important role in trying to address them over several decades was Jacques Polak. Sadly, he passed away earlier this year. Reflecting on the efforts to reform the international monetary system since the Bretton Woods conference, Jacques Polak once suggested that “those of us who toil at the international monetary system would do well to adopt Sisyphus as our patron saint”. In honor of Jacques Polak, let us then push the stone back up the mountain once more and start with our first panel. Thank you for your kind attention. BIS Review 65/2010  3