samchain/econo-pairs-v1 huggingface dataset:
And, partly, it is because some investors may choose to switch to cash if the level of interest rates becomes too low. 11 See, for example, De Rezende and Ristiniemi (2018). 14 [25]  If quantitative easing is to be a part of the permanent monetary policy toolbox, it would be an advantage if the instrument could be used more systematically than has been the case during the crisis. Much of the development of the monetary policy analysis has focused on the importance of a systematic approach and communication – and this should also apply to new instruments, again to influence expectations in the outside world as much as possible. In addition, the central banks need to find clear strategies for how they can reduce their holdings of financial assets when economic activity improves and inflation rises, to avoid their balance sheets increasing with each recession. Forward guidance to influence expectations of future interest rates Ever since 2007, the Riksbank has engaged in a form of forward guidance, by publishing, in each Monetary Policy Report, its best assessment of the future development of the repo rate, inflation and the real economy. This is a matter of convincing the market of where we believe the economy and repo rate are heading. Even if it is difficult to make forecasts and we have often believed that interest rates would rise faster than was actually the case, communication about the future has still been useful, particularly over the shorter horizon.

After a few years of getting used to this new way of conducting monetary policy, there was a long period of relative calm in large parts of the world. Many countries introduced a similar policy that had the more or less explicit target of holding inflation close to 2 per cent. From the middle of the 1990s until 2008, inflation was on average fairly close to the target and developments in the real economy were more stable than before. Blanchard and Simon (2001) were among the first to document this phenomenon, which came to be called the ‘Great Moderation’. But even then, there were discussions of whether the phenomenon was due to structural changes, skilful macroeconomic policy, including monetary policy, or quite simply luck. At the beginning of the 1990s, the Riksbank's balance sheet grew in connection with the foreign currency reserves being reinforced through loans (see Figures 1 and 2). When the fixed exchange rate was abolished, it was decided that there was less need to hold foreign currency reserves for monetary policy purposes and the size of the balance sheet declined fairly rapidly. Between 1994 and 1998, domestic bond positions were sold off and foreign currency loans were repaid. 4 Instead, the Riksbank conducted monetary policy with a minimal toolbox in this new environment. The repo rate, which is the base for the lending and deposit rates the Riksbank applies with regard to the commercial banks, was adjusted to ensure monetary policy was well balanced.
We are being tied together more and more by trade, by emerging financial markets and, of course, by modern forms of communication. Secondly, in the past twenty-five years a great many people have become materially better off. Lima’s streets and shops are evidence of this. Yet Peru is not one of the developing countries that have benefited most from the economic developments in recent decades. On the contrary, whereas the developing countries’ aggregate GDP has grown by 89 per cent since 1980, the figure for Peru is 60 per cent. Due to differences in population growth, moreover, the corresponding per capita figures are 35 and 10 per cent. Thirdly, despite all the improvements, many people are still living in poverty. Income gaps in Peru were glaringly large throughout the twentieth century and remain so today. In 1996 the income of the richest fifth of the population was twelve times that of the poorest fifth. Turning now to the developing countries as a group, in the past fifteen years the proportion of poor people has admittedly decreased but it is still the case that the favourable trend in recent decades has failed to benefit large numbers — even practically entire countries, particularly in Africa. To me it is a healthy sign that this situation is raising questions about how the global economy functions. Personally, I do not think we should rest content with aiming for a general improvement in living conditions for everyone.

In periods, this has given rise to unrest among local authorities and employees, for example in the traditional manufacturing city of Trollhättan. In Norway, many large multinational companies have closed down operations at home and established their main offices and warehouses in the Stockholm or Malmö/Copenhagen area. Both the Norwegian costs level and population density have been of disadvantage to use with regard to these structural developments. Sweden has partly responded to strong international competition by continuing to develop new and improving existing products and processes. The country has also become a Nordic financial centre by being the home country to four large financial conglomerates. As mentioned the Norwegian economy has benefited from good prices for our export products and proximity to petroleum activities provide Norwegian manufacturing with advantages. However, our oil dependence and a lack of diversification in our industry structure are a source of concern as regard long-term developments  Conclusion Monetary policy’s most important contribution is to provide the economy with a nominal anchor. Today, inflation targeting is the norm for small and medium-sized economies. Exchange rates fluctuate, but there are several ways of hedging against fluctuations. After Sweden switched to inflation targeting, the country has experienced solid output growth and low and stable inflation compared with the previous decades. Since 2002, inflation has fallen sharply both in Norway and Sweden. Between December 2002 and March 2004, the key rate was reduced by a total of 5.25 percentage points in Norway.
When information is no longer exclusive, it becomes easier to form an opinion of one's own with regard to developments and risks, and not merely to follow others in the belief that they know something you don't. At the same time, it is important to remember that our insight into why financial crises arise and spread is still limited. This means that increased transparency will not in itself be able to solve all of the problems discussed. It must be combined with increased knowledge of these issues. Cautious use of risk models The financial crises have exposed the failings in the various statistical risk models regularly used by players on the financial markets. These are nothing more than very simplified pictures of reality and are based on historical values. And history doesn't always constitute a good base for making forecasts for the future. Financial players must therefore become better at taking into account less probable events when they are analysing the risks of various investments. One example of how this could be done is to supplement the risk models with “stress tests”. These tests are used to analyse how “stressed markets” - ie exceptional, but possible, outcomes or events - would affect the players' current positions. According to the latest quarterly report from BIS, use of stress tests is becoming more widespread and many financial institutes now use them as an integrated part of their risk management.

The Bank of England has adopted a schedule for our Discount Window Facility under which the rate charged increases with the size of a drawing relative to the bank’s size, and also with the illiquidity and riskiness of the collateral provided. We want to underline that banks will end up paying more to draw on the insurance line if they are overly reliant on illiquid, risky collateral – implying that their balance sheet was overly exposed to liquidity risk. These considerations have to be taken into account if central banks are to lend against very broad asset classes; for example, as we flagged earlier in the year, the Bank of England will be deciding over the coming months whether to extend the collateral eligible in our Discount Window to portfolios of loans to companies and households and of equities. The Bank of England also charges a premium rate if a bank borrows from us against assets comprising securitisations of loans they originated themselves. This is because there needs to be an incentive to make such securities marketable; and, more important, it can help to protect us against one of the most basic risks in banking – the correlation between the quality of a bank’s underwriting standards and its solvency. Although central banks need to be ready to lend against a wide range of collateral, we do still need to be careful about precisely what we take.
It was not fully completed until the Maastricht Treaty of 1992 when free movement of capital became a directly applicable Treaty right. And throughout this process, in recognition of the potentially destablising effect, safeguards were included to allow member states to defend their stability, including in relation to prudential supervision. The real push for free movement of capital came in the mid 80’s when European growth was sluggish, especially compared to the US and Japan. There was a search for policies to generate economic dynamism, which led to the birth of the single market. But, of course, until capital could flow freely between member states it was not really possible to have a single market in financial services or, in the financial sector, to give effect to that other founding freedom – the freedom to provide services across the EU. The liberalisation of capital markets in the EU was rooted in two beliefs. First and foremost that open capital markets, cross border investment and cross border financial services would create a more efficient allocation of capital through better intermediation between savers and borrowers across the EU as a whole. And, second, that the risks to economic and financial stability of an open capital account and cross border financial services could be managed by sound economic and financial policies to prevent destabilising volatility of capital flows and by good financial services regulation at the EU level.

Of course we didn’t have Brexit in mind when updating the Remit in 2013, nevertheless the Bank headed into the EU referendum last year with arguably the most clearly defined objective for monetary policy in its 323 year history. And it has been the foundation of the framework the MPC has used to set monetary policy since the referendum result. Although I only joined the Committee in September, the analytical approach in the framework is one that I fully sign up to. So I would like to spend a minute setting it out. Fundamental to the way in which the MPC has reacted to Brexit is that monetary policy cannot prevent either the necessary adjustment – such as that implied by the movement of the exchange rate - as the UK moves towards its new international trading arrangements, or the weaker income growth that is likely to accompany it. These are real phenomena likely to play out over many years – exactly the kind of thing that monetary policy cannot affect, no matter how often it is asked by some commentators to do so. What the MPC can do is support the economy during the adjustment process. But even in doing that the Committee has faced a trade-off between stabilising inflation on the one hand and output and employment on the other.
Earlier episodes of balance of payments crises have typically been associated with high debt and liquidity and currency mismatches, which leave economies vulnerable to abrupt deterioration of international financial conditions. In Chile, the present current account deficit is being financed mainly by FDI flows, associated with reinvested earnings and new investments, thus providing more strength to the capital account. Despite these factors, we need to remain vigilant because an economic scenario like the present one can favor the incubation of future risks. Domestically, a scenario of very dynamic final sales and personal income, low unemployment and high utilization of installed capacity,  BIS central bankers’ speeches  1  can exacerbate the response of domestic demand and further expand the current account deficit. Abroad, the present abundance of international funding as a result of expansionary monetary policies in developed economies may facilitate the financing of the external deficit and push asset prices up, at the expense of incubating vulnerabilities for the future. All this means that we must be particularly alert to prevent financial vulnerabilities from incubating, since these situations can lead to higher leverage of households, firms and financial intermediaries, as well as currency and liquidity mismatches. In this regard, one reassuring element is that in recent months there has been a moderation in household indebtedness, which in any case has remained in line with the income trajectory. It is also important to continue to monitor the evolution of key financial prices and their interaction with lending.

Figure 4  CPI inflation (*) (annual change, percent)  CPIEFE inflation (*) (annual change, percent)  10  10 10  10  8  8  8  8  6  6  6  6  4  4  4  4  2  2  2  2  0  0  0  0  -2  -2 -2  -2  -4  -4 -4  -4  07 08 09 10 11 12 13 14 15  Dec.2012 Report  07 08 09 10 11 12 13 14 15 Mar.2013 Report  (*) Gray area, as from the first quarter of 2013, shows forecast. Sources: Central Bank of Chile and National Statistics Institute (INE). BIS central bankers’ speeches  9  Figure 5 MPR and expectations (percent) 9 8 7 6 5 4 3 2 1 0  9 8 7 6 5 4 3 2 1 0 07  08  09  MPR  10  11  13  12  FBS, March 2013.Q2  14  15  EES, March 2013  Source: Central Bank of Chile.
By the end of October 2009, most hedge fund investment strategies have already recouped a substantial part, or even all, of the losses they suffered in 2008. Cumulative average year-to-date investment returns at the end of October 2009 of all hedge fund investment strategies had almost all signs opposite to those reported for the whole of 2008 (See Chart 3). At the same time, after significant investor outflows in earlier quarters, preliminary estimates for the third quarter of 2009 suggest that the second quarter of 2009 may have marked the end of sectorwide investor outflows. III. Risks in the euro area non-financial sectors  Let me now focus on risks and vulnerabilities that we have identified in the non-financial sectors of the euro area economy. Despite the considerable heterogeneity at the country level, the overall macroeconomic environment in the euro area has improved over the past six months. The decline in euro area economic activity has been sharp by historical standards since the third quarter of last year, but quarterly real GDP growth has recently turned positive (see Chart 4). In addition, the latest Eurosystem staff macroeconomic projections show a gradual recovery in 2010, although the road ahead is likely to be uneven. Among the risks stemming from the euro area non-financial sectors, I will highlight the main vulnerabilities in the corporate sector, specific fragilities in the commercial property market, and certain risks associated with the household sector.

Governor’s Keynote Address at the International Conference on Financial Crime and Terrorism Financing (IFCTF) 2022 Speaker: Tan Sri Nor Shamsiah Mohd Yunus / Venue: Kuala Lumpur / Language: English / Speech/Interview Date: 26 Jul 2022 /  It is a pleasure to be able to speak again at this conference after a two-year hiatus. A lot has changed in these two years as we adjust to living with COVID-19. Like every other country, we anticipate with hope and perseverance, that the pandemic is well and truly behind us. But this exceptional and extraordinary period in our history will serve to remind us, that vigilance in the fight against financial crime can never be relaxed. During this period, reported financial crimes in many countries increased significantly, as criminals exploited conditions created by the pandemic, to commit financial crimes – making an already difficult time that much worse, for many who became victims of such crimes. Occasions like the IFCTF provide an opportunity to renew our determination to prevent the financial system from being abused for criminal purposes, or to inflict terror on our communities. Financial crimes have a direct and important effect on our economic prospects. So let me preface my remarks today with some observations on our economy. Malaysia is firmly on a recovery path. Supported by solid domestic activity and positive external demand, the economy is expected to grow steadily in 2022 and 2023, despite continuing challenges from rising cost pressures, the military conflict in Ukraine and strict containment measures in China.
At the end of the day it's probably fair to say that, although we may experience some difficulty in describing exactly what a derivative is, we can usually recognise one when we encounter it. The interests of the central bank in derivatives will tend to be rather broader than those of any commercial bank, trader or broker, because of its multiple policy responsibilities. The issues can be conveniently grouped under four headings: infrastructure, supervision, information, and operations. Infrastructure HKMA is probably fairly typical of most central banks in developed financial centres in having a general concern for the stability and development of the financial infrastructure, but without necessarily being involved directly in the provision of that infrastructure, of which derivatives nowadays form an indispensable part. Derivatives have brought substantial benefits to the commercial community, in facilitating hedging and hence business planning more generally, and have enabled the financial institutions to offer a progressively wider range of services and greater efficiency in the intermediation process, as well as to exploit market imperfections and other trading opportunities for their own gain. The range of available derivative products in Hong Kong is extensive. Exchange tradable derivatives include futures and options on the Hang Seng Index as well as on individual Hong Kong stocks and, since the launch a few weeks ago, on a selection of leading stocks of certain overseas exchanges. Exchange traded interest rate products include one-month and three-month HIBOR futures; and futures contracts on three-year Exchange Fund Notes are expected to commence trading later this month.

Second, although central banks and governments are nowadays much more transparent about their operations than previously, use of derivatives may in some instances provide some temporary disguise, but disguise would seldom be a very healthy reason for selecting a strategy. Third, as implied in the above quotation, the perception continues to exist that derivatives are a particularly risky activity, or one which might signal some degree of desperation. Despite the fact that such views may be irrational, a central bank may need to acknowledge public sensitivities and err on the side of conservatism in its operations. Fourth, in searching for the most cost-effective or reliable avenue for monetary operations, it should be borne in mind that the derivative markets may be more fickle and less liquid than the cash markets, perhaps the more so at the very moment when you might be most tempted to use them. In sum, I do not currently see a convincing case for using derivatives as a monetary policy tool. In the final analysis, however, a central bank is entitled to keep all its options open and to surprise the markets if it so wishes, provided that it is ultimately accountable for its actions. Conclusion I have tried to briefly explain some of the angles from which central bankers generally, and the HKMA in particular, view derivatives.
14  Central Bank of Chile 29 June, 2017  FinTech in Chile [SLIDES 17 and 18] According to the CCAF 2017 The Americas Alternative Finance Industry Report Hitting Stride, Chile is the country with the largest development in FinTech services. This is due to a large extent to the fast development of crowdfunding platforms in Chile5, which appear to have flourished from their connection to factoring services. Slide 17  FinTech in Latin America: size Volumes by Alternative Finance Model (in million of dollars) Total  400  80  250  60  200  114.2  97.8  100  300  64.4  11.2  12.6  2015  2016  Mexico  Chile  0  Brazil  0  50 2014  9.9  Argentina  20  56.1  Colombia  110.6  Peru  40  150 100  By country, 2016  120 342.1  350  Source: Ziegler, T. et al. (2017), “Hitting Stride - The 2nd Americas Alternative Finance Industry Report,” Cambridge Centre for Alternative Finance, June 2017. Slide 18  FinTech in Chile: size Chile: Volumes by Alternative Finance Model 2014-2016 (in million of dollars) Equity-based Crowdfunding  0 0 1.4  Marketplace / P2P Consumer Lending  0.47 0 0  Reward-based Crowdfunding  0.9 1.1 3.5  2014  36.9  Marketplace / P2P Business Lending  46.5  2015  2016  92.9  Source: Ziegler, T. et al.

Since July 2007 the ECB has estimated daily yield curves reflecting the implied market remuneration rates of euro area central government bonds for residual maturities ranging from 3 months to 30 years. These curves help to gauge market expectations regarding economic and financial activity, as well as being used for monetary policy purposes. The curves are presented in a very user-friendly way, using the latest web technologies. 4  4. The available monthly statistics on outstanding amounts of Short-Term European Paper have been supplemented with daily statistics on yields. This has enabled the ECB to ensure transparency while respecting the confidentiality of individual price or yield data. 5. The external statistics of the ECB now provide separate data for Brazil, Russia, India, mainland China and Hong Kong as counterparts. Moreover, they also show the quarterly changes in the overall external position of the euro area, broken down into transactions, exchange rate changes, asset price changes and other changes. 5  1  See http://www.ecb.europa.eu/stats/money/interest/interest/html/interest_rates_2007-12.en.html. 2  An updated overview of all available ECB statistics has recently been http://www.ecb.europa.eu/pub/pdf/other/ecbstatisticsqualityframework200804en.pdf. 3  See “The introduction of quarterly sectoral accounts statistics for the euro area” in the November 2007 issue of the ECB’s Monthly Bulletin; “Recent developments in the household and corporate sectors: information from new quarterly euro area sector accounts” in the June 2007 issue of the ECB’s Monthly Bulletin; and “New estimates on holdings by sector for euro area M3” in the December 2007 issue of the ECB’s Monthly Bulletin. 4  See http://www.ecb.europa.eu/stats/money/yc/html/index.en.html#data.