samchain/econo-pairs-v1 huggingface dataset:
To carry out our oversight responsibilities effectively, supervisors will also need to develop the capacity to assess and identify key vulnerabilities in the increasingly sophisticated web of information networks and systems upon which the financial sector depends. For one, supervisors need to arm themselves with the skills and knowledge to make assertive and rigorous assessments of a financial institution’s IT risks and be able to form judgments about the adequacy of control systems. Training and development programmes for supervisors should therefore give the same emphasis as other critical risks such as credit and market risk. The establishment of specialist supervisory teams or units dedicated to IT risks also plays an important role in building a strong knowledge base within supervisory authorities to support effective supervision of IT risks. Just like industry practitioners, it is imperative that any knowledge and skills acquired by supervisors are in tandem with the latest developments in both cyber security and cyber threats. Beyond efforts to build technical capabilities, supervisors and other law enforcement agencies also need to be equipped with the legal powers to investigate and prosecute cyber criminals. Given the borderless nature of cyber risk, this is a significant challenge. Cyber crimes can be launched from anywhere in the world, with targets in many countries. This underscores the need for a more coordinated global response that should involve criminal law enforcement agencies and financial regulatory authorities. In this regard, cross border collaboration must be intensified to establish information sharing arrangements on cyber risks and trends.

In connection with the work on legislation, it was discussed whether the Riksbank should also have objectives regarding GDP growth or employment, for instance. The Government and the Riksdag (parliament) decided that the Riksbank as an authority under parliament was obliged to support general economic policy goals such as sustainable growth and high employment. However, it was pointed out that this support should not come into conflict with the price stability objective. It is thus important to remember that the legislators considered it natural for the Riksbank to take into consideration the real economy, but that this consideration was not described as an objective for the Riksbank’s monetary policy. In my opinion, this was a wise decision and I see no reason to change the  BIS Review 12/2006  3  framework and introduce additional objectives to price stability. The Riksbank’s current method of working closely follows the views of the legislators. Monetary policy takes into consideration other aspects than inflation trends, and it should do so. How do we do this? As you know, the practical monetary policy work is governed by the objective that the increase in the consumer price index should be 2 per cent a year. This is how the Riksbank has chosen to specify the statutory objective of price stability. There is a tolerance interval of ± 1 percentage point around the target.
This forecast is based on the projected gradual increase in the levels of resource utilization, a firming in global demand, and the upward pull exercised by stable inflation expectations on actual inflation. Underpinning the latter assumption is the broad stability of long-term inflation expectations across different financial and survey measures, combined with ongoing moderate growth of wages and unit labor costs – all observations consistent with anchored inflation expectations. Overall, I would characterize the outlook as reasonably favorable. But I would very much prefer faster economic growth and more rapid progress towards our dual mandate objectives of maximum sustainable employment and price stability. Hence, the continued need for monetary policy to remain highly accommodative to support the economic recovery to the fullest. Thank you for your kind attention and I will now be happy to take some questions. BIS central bankers’ speeches  5

There will, of course, be circumstances when a cut in interest rates is compatible with the sustainability of the peg. When this is the case, the Central Bank will not hesitate to reduce interest rates, as it did recently. But those who argue in favour of pursuing growth through monetary expansion should remember that investment is not interest-rate sensitive. Investment decisions are based on a range of factors of which the cost of money is but one. Similarly, bank interest represents only a small fraction of production costs. Finally, some people would have us devalue the currency in an attempt to stimulate growth by improving export price competitiveness. This option carries with it the real prospect of higher import prices and, therefore, a significant cut in real wages and wealth. To the extent that this is not followed by compensatory measures, it would indeed help to increase exports and restrain consumption demand and hence, imports. But it would also imply a decline in living standards. The extent to which the benefits of improvements in cost competitiveness would be reaped in a situation where the export sector is already operating close to full capacity is also doubtful. Past experience, however, suggests that a devaluation would be followed by a nation-wide rise in wage levels as the partial wage indexation system came into play, and this would generate price inflation and erode competitiveness. In Malta, therefore, devaluation would impose immediate costs and leave no long-term benefits, besides weakening the credibility of the lira.
However, it is also worth noting other channels through which monetary policy affects economic activity are not impaired, including the impact on spending that is generated by rising wealth, declining risk premia and improving confidence. It is important to recognize that our tools are not all-powerful – monetary policy is not a panacea for all that ails our economy. But, at the margin, firms facing lower borrowing costs for any given economic outlook will invest and hire more. People who refinance at lower rates, or see the value of their homes and 401K pension plans go up, will spend more. I believe that a nudge in the right direction will move us closer to a self-reinforcing cycle of more hiring, more spending, more growth, and more investment. This is the type of virtuous cycle that we should seek and one that is consistent with a self-sustaining and improving economy. I believe our latest statement provides greater clarity about how we intend to use the tools we have to promote our statutory objectives. As Chairman Bernanke said at his press conference, the idea is to make it “more explicit, more transparent to the public, make it more obvious that the Fed will do what’s needed to provide the support for the economy.” In particular, the amount of asset purchases that we undertake will be a function of how the economy evolves. If the economy is weaker, we’ll do more.

Let me start by saying that New Jersey is well-positioned to prosper. New Jersey is the 11th largest state – with a population of 8.8 million and this population is well-educated. Roughly 35 percent of adults over 24 years old have a college degree, well over the national average. Here in Morris County, that figure is almost 2  BIS central bankers’ speeches  50 percent. The state is also quite ethnically diverse: roughly 20 percent of New Jersey residents were born abroad. The state’s economy is industrially diverse, resembling the nation. New Jersey employs many people in healthcare, professional and business services, wholesale and retail trade, and leisure and hospitality. In the northern part of the state, we see a disproportionate share of jobs in a few industries: finance, particularly in Hudson County; goods distribution, related to the ports, rail lines and trucking and warehousing activities that are prominent here; pharmaceuticals manufacturing and R&D; and private education. The area obviously benefits from its important links to New York City. In particular, many residents of this area, including myself, commute each day to the city. So how is the recovery proceeding here? Based on the New York Fed’s indices, economic activity in the state did not begin to recover until November 2010, more than a year after the nation and New York City. Since then, activity has recovered at a moderate pace, although we are still operating below our previous peak. Employment in New Jersey declined substantially during the downturn. Our employers cut about 250,000 jobs.
On the other hand, banks with activities in several countries should be in a stronger position to cope with a recession or a crisis situation in a given country than banks whose activity is confined to one single country. This is positive from a financial stability point of view. 5.2  The Internet as a distribution channel for financial services  Let me now turn to the impact of the Internet on the banking and financial services industry. The Internet creates new opportunities for traditional banks. For example, banks should be well positioned to become key operators in trading on the Internet. They have a large customer base and strong brand names, and can offer payment transmission services, advertising space and links on their home pages. Internationally, many banks have agreements with Internet or telecommunication companies for the development of Internet banking and marketplaces on the Internet. This is probably just the beginning of a trend towards increased cooperation across industry boundaries. The Internet poses great challenges as well. It is clearly intensifying competition in the industry. This is partly because it is easier for customers to compare prices and terms and partly because it is simpler for new operators to penetrate the market. The Internet may also change the relative positions of existing market participants. Many Nordic banks have established some form of Internet banking. So far, most services offered on the Internet are relatively simple, for example loan applications, bill payments and account transfers.

It peaked at 13%, which is very high, at the height of the crisis and now it’s at 9.8%, so it’s below 10%. The euro area has created 4 million jobs in four years, that’s not bad. Yes, this morning we have to say “Thank you, ECB”. The Banque de France has just said this morning that it is lowering its growth forecast for France to 1.3% for 2016 and 2017, and then to 1.4% in 2018 because of the worsening international environment. Is the Banque de France more pessimistic than the ECB? Because you are saying that the growth situation isn’t bad in France. No, we agree with the Banque de France – growth will be weaker in France than in the rest of the euro area, unfortunately. 1.3%, 1.4%? Yes, 1.3% in France, 1.7% in the euro area, so France is lagging behind in terms of growth. And what does France have to do to recover or catch up with the other countries? When you read the programmes of the candidates for the presidency, whether on the right or the left, do you ever say to yourself that this one or that one would enable France to catch up? The ECB doesn’t get involved in politics...  Of course. So don’t expect me to express a preference for one of the candidates. However.
We announced the outline of the monetary and exchange rate policy for 2015 through a press meeting on 10 December 2014. We also launched new macroprudential policies to limit macro-financial risks and to support prudential borrowing at this meeting. In this scope, to encourage the extension of maturities of external borrowing, we raised the required reserve ratios applied to non-core foreign exchange (FX) short-term liabilities of banks and financing companies. Additionally, we embarked on the remuneration of TL required reserves to encourage core liabilities in January 2015. Moreover, we implemented technical adjustments in reserve option tranches and coefficients to meet the FX liquidity to be required due to the changes in required reserve ratios. We envisage that the automatic stabilization feature of the Reserve Option Mechanism (ROM) will gain strength with these adjustments. Through these policy measures we announced, our final aim is to limit macrofinancial risks and contribute to balanced growth by supporting prudential borrowing. The rate of increase in the loans extended to the non-financial sector in the last quarter of the year maintains a reasonable course owing to the CBRT’s tight monetary policy stance and the macroprudential measures. Supported also by the actions of the Banking Regulations and Supervision Agency (the BRSA), consumer loans grew slower than past years, while commercial loans displayed a higher rate of increase (Charts 7 and 8).

Shares of individual regions in global trade % Total  1990  1995  2002  Developed countries  72  67  63  US  12  12  11  UE15  44  39  38  Developing countries  28  33  37  Asia  13  19  20  Source: IMF Direction of Trade Statistics  6  BIS 75 Annual Report, 2005. 7  th  Ciccarelli, Mojon “Global Inflation”, Central Bank of Chile Working Papers No 357, December 2005. BIS Review 32/2006  3  Global capital flows keep growing even more dynamically, whereby the share of the global FDI in the global GDP increased from 8% in 1989 to 22.1% in 2003, and foreign assets expressed as percentage of the GDP increased from 62.6% of the GDP to 186.1% of the GDP, respectively. As evidenced, the role of trade and financial links between enterprises in various countries has become more important over recent years. Previously, in response to growing fuel prices or costs of living, trade unions demanded wage increases, which triggered the so-called second-round effects and central banks had to increase interest rates to mitigate inflation. Nowadays, trade unions must take into account the fact that in the case of wage increases, production and services may be transferred to countries with lower manufacturing costs.
It can and should take on an international dimension. Through facilitating the inward investment of foreign savings, the source of funding for much needed domestic investments can be tremendously enlarged. This would also enhance the overall efficiency in the international allocation of funds, to economies that can provide a higher return commensurate with the risks involved. An economy with capital controls should therefore plan for the eventual internationalisation of the bond market, even though the associated financial liberalisation process can be quite a risky one. But risks are to be managed and not avoided, and the benefits of open markets far outweigh the costs in terms of financial instability. I can confirm this, even with the unpleasant experience of the financial turmoil of 1998. Free and open markets impose a valuable discipline on policy makers that is to be welcomed in the long-term interest of the people they serve. Fifth, and turning to the actual bond market development issues, there is a need to adopt a comprehensive approach. We should address the demand and supply sides, the environment in which they interact to discover the prices for the debt instruments, including market making arrangements and the determination of benchmarks, and the market infrastructure, including payment, clearing and settlement systems. Focusing on these issues individually, and this is the sixth point, there is usually strong latent demand for debt instruments, particularly in economies with a high savings rate.

Or if he had to wait a considerable amount of time to receive it after he had paid over the money, or if the money that he had paid over was not received by the vendor. I have often pointed out that governments spend huge amounts of money and efforts building the physical infrastructure to move people and goods around safely and efficiently, but that not even a small fraction of those resources is given to moving money and financial instruments around safely and efficiently. The result, very simply, is inefficient financial intermediation. Money is not mobilised to its full potential, and economic progress is undermined. The financial infrastructure that we want, to use a bit of market jargon, is one that enables, as soon as possible after dealing, RTGS DvP, namely, real time gross settlement with delivery versus payment for transactions in financial instruments (RTGS PvP or payment versus payment for foreign exchange transactions). This is what we have achieved in Hong Kong. Hong Kong’s bond market Let me turn now to the development of Hong Kong’s bond market and share with you our experience. As I said earlier, after agonising over this for a long period, behind the convenient argument that if there is a need for a market to develop it will develop by itself without the urging of government, we decided to get involved. The Exchange Fund Bills and Notes programme was subsequently introduced at the beginning of 1990.
As the Chilean peso, emerging market currencies have generally appreciated, and since the beginning of the year have been accompanied by a return of capital inflows to these economies. The continuation of this phenomenon brings back some issues, as the abundance of capital may be difficult to accommodate in a small economy like Chile. Such episodes are not new to us and bring with them discussions as to the convenience of exchange market intervention, which some Latin American economies have undertaken in recent weeks. We are convinced that a floating exchange rate regime is the most appropriate one for Chile, as it facilitates macroeconomic and external accounts adjustments. Nonetheless, there are circumstances that may lead to Central Bank intervention in the exchange market, either to sustain an adequate level of foreign reserve assets, or to respond to overreactions in the exchange rate that are not aligned with medium-and long-term fundamentals. Associated to this type of intervention, there are costs. A first one is that it may create confusion as to the monetary authorities´ objective: inflation or the exchange rate. In our case, we have dealt with this by means of transparent mechanisms whereby we anticipate the amounts and terms of interventions, and by maintaining exchange rate flexibility. A specific exchange rate level has never been a Central Bank objective; at most these interventions are conducted to prevent excess volatility or temporary diversions from its long-term equilibrium. It has always been made clear that the Central Bank of Chile pursues a price stability target.

Additionally, we are confronting new risks, in the face of international tensions related to Iran’s nuclear situation and its impact on the oil market. These sources of uncertainty are beyond our control. Therefore, our role as policymakers in emerging countries is to preserve flexibility and space for policies that will enable us to respond to and buffer the financial and real effects that those risks pose on our economies. Over the last years we have gained credibility, flexibility and space to implement a macroeconomic and financial policy framework that will help us smooth out the economic cycle. This framework rests on four pillars. First, monetary policy management is based on a flexible inflation-targeting regime, conducted by an autonomous central bank and supported by a floating exchange rate system. Second, a fiscal policy that is accountable and predictable thanks to a structural balance rule. The significant amount of savings accumulated during the run-up of copper prices was a crucial factor in bolstering the resilience of the Chilean economy and in providing a countercyclical fiscal boost. Third, a high degree of commercial and financial integration with the rest of the world. Finally, a sound financial system, with globally integrated, well capitalized, and adequately-regulated banks. These elements allowed us to be less affected by the Great Recession than by previous episodes. In Chile, the effects of the world slowdown of the second half of 2011 and the financial turbulences coming from Europe have so far been limited.
But falls in oil and commodity prices can have a more lasting impact on inflation – and hence become relevant for monetary policy – if they feed into core inflation. That can happen under two circumstances. The first is if price falls are symptomatic of weakening global demand, rather than a boost to global supply. Then, lower oil prices might be accompanied by declining net exports, which could in turn cause firms to cut back on investment and drag down core inflation. This blunts the growth-bolstering effect of lower commodity prices. Imported inflation might also be depressed as foreign producers cut prices in reaction to weakening global growth. The second circumstance is if there is a succession of supply shocks that keep inflation low for a long period and cause firms and households to revise down their inflation expectations. In that situation, low oil and commodity prices can have “second round effects” as lower expectations feed into wage bargaining and price setting, thereby affecting core inflation. Then, the effect of supply shocks becomes more similar to demand shocks. In both cases, central banks end up facing a situation not of a benign supply shock, but rather of an adverse demand shock that, if left unaddressed, could derail price stability over the medium-term. That would call for a more forceful monetary policy response. Importantly, there were signs in the past that such circumstances were present in the euro area.

With well-trained, English speaking, and cost-competitive professionals, India has created a niche for itself as the world’s back-office as well as a global software centre. The BJP coalition’s unexpected defeat in the general elections reflects the unhappiness of rural voters who have not benefited from the liberalisation. This may cause the new Congress government to be more circumspect about pressing ahead with reforms, although optimistic commentators argue that the voters are pressing for faster reforms rather than slower. Whether or not that is so, the policy of liberalisation commands bipartisan support, and is likely to continue. After all, the new Prime Minister, Dr Manmohan Singh, was the architect of the initial economic reforms in the early 1990s. He has appointed as Finance Minister Mr Chidambaram, who is also a reformist and a former Commerce Minister and Finance Minister. I am therefore hopeful that the thrust of liberalisation will continue, and India will play increasingly a prominent role like China’s in the regional and global economies. Closer to home, the prospects for Southeast Asian economies are also looking better. The region initially struggled as political and security concerns deterred foreign investments and distracted  BIS Review 33/2004  1  governments from tackling serious economic problems. But Southeast Asia has stabilised considerably in recent years. Governments are responding more vigorously to the threat of terrorism and restoring order and confidence. The political upheavals that swept across the region have also subsided, allowing governments to focus their attention on fostering growth and development.