samchain/econo-pairs-v1 huggingface dataset:
Instead, I would like to focus on two issues, which in the current context are very relevant from a monetary policy perspective – regardless of the structural causes underlying the weak economic growth. First, the slowdown in growth in this environment increased the risk of a self-reinforcing downward spiral. For the weak growth dynamics will not go unnoticed by economic actors: their expectations are worsening. If, for instance, a company expects demand to fall, it will be less inclined to make big investments. Secondly, ageing societies, which exist in many mature economies, not only have to cope with a shrinking labour force, but they also have to save more. This has led to a savings glut and to a shortage of safe assets. So investments are falling and savings are rising. This weakness of investment is further reinforced when public authorities invest less than is even needed to preserve the capital stock. This is a cause for concern especially where both fiscal space and demand exist. This dynamic has led to a reduction in the natural interest rate, i.e. the real rate of interest in which savings and investments are in equilibrium in an economy operating at its potential, where there is neither upward nor downward pressure on inflation. In the current environment, the ECB has brought the market rate below the level of the natural rate. The key rate since March last year has been at zero and the rate on the deposit facility at – 0.4%.

And while other countries have cut the number of banks by almost a quarter following the financial and economic crisis in order to reduce overcapacity, the corresponding figure for Germany was only 10%.4  Traditional business models under review The current low interest rate environment has not just revealed weaknesses among banks, it has also called into question the traditional business models of insurance companies and pension funds. 3/5  BIS central bankers' speeches  For many insurers in Germany, guaranteed returns have become an issue. In the current market environment, it is becoming increasingly difficult to achieve the guaranteed interest rates of 4% that were commonplace in contracts concluded in the mid-1990s. The German ministry of finance has reduced the guaranteed interest rate for the current year from 1.25% to 0.9%. Many insurance companies are now increasingly turning to unit-linked products. In addition, new regulatory requirements are increasing the demand for safe assets. German government bonds alone are yielding negative returns on maturities of up to seven years. Against this backdrop, discussions are under way as to what can be done to counter this shortage of safe assets. One suggestion is that market participants create a new kind of safe asset, known as European Safe Bonds (ESBies)5, consisting of the senior tranche of a portfolio of existing bonds from different euro area countries. The advantage here would be that no joint liability would exist, as is the case in other proposals of this kind. From a purely academic perspective, this is certainly an interesting idea.
For the ECB, efficient, resilient and liquid financial markets are a key prerequisite for the smooth implementation and transmission of monetary policy. The ECB therefore strives to ensure that regulatory reform initiatives do not impose restrictions which may hinder the efficient functioning of markets or impair their liquidity. Formally, the Treaty on the Functioning of the European Union assigns to the ECB an advisory role as regards proposed EU acts2, i.e. the ECB is consulted on proposed EU directives (general framework legislation). Furthermore, delegated and implementing acts  1  Press release: ECB announces rescheduling of loan-level data reporting requirements for asset-backed securities, 27 November 2012. 2  See Articles 127(4) and 282(5) of the Treaty. 2  BIS central bankers’ speeches  qualify as proposed EU acts, and therefore the scope of the ECB’s consultation also extends to such acts as well as to draft technical standards.3 In addition, we continually exchange views with market participants, for example via our ECB market contact groups.4 The regulatory debate has become a standard agenda item in those meetings. A number of regulatory measures target financial markets. Let me focus in the rest of my speech on a very important regulatory initiative and on a concrete example: the review of the MiFID II and, specifically, the proposed price transparency requirements.

We had recently issued a concept paper on Life Insurance and Family Takaful Framework. This Framework is set to transition the life insurance and family takaful industry into a new operating environment, characterised by changing market dynamics including demand for greater transparency, and driven by advancement in technology and changing consumer behaviour. The Framework’s main aim is to increase insurance and takaful penetration, and ensuring a fair deal to consumers. The framework is supported by three main pillars; the liberalisation of operating limits, diversification of delivery channels and strengthening of market conduct practices. The Framework will be implemented in two phases to allow the industry and the public sufficient time to adjust to the new operating environment before further liberalisation is  BIS central bankers’ speeches  1  considered. Under the first phase, greater operational flexibility is given to life insurers and family takaful operators to operate in a more competitive environment and allow greater product innovation to be delivered through a wider range of delivery channels. The Framework proposes for the current commission and other operating cost limits for investment-linked products to be removed. In addition, the commission limit for pure protection products, namely pure term, critical illness and medical and health is also proposed to be removed subject to certain preconditions. While allowing greater operational flexibility, the Bank will ensure consumers’ interest remains protected.
Stefan Ingves: Introduction on monetary policy Speech by Mr Stefan Ingves, Governor of the Sveriges Riksbank, at the Riksdag Committee on Finance, Stockholm, 22 February 2007. *  *  *  Thank you for the invitation to come here! I came here for the first time one year ago, as newlyappointed Governor of the Riksbank. A year passes quickly, and now it is once again time for me to summarise the past year and at the same time report on how the Executive Board of the Riksbank views the prospects for the economy and inflation. Before I begin, I would like to welcome the fact that the Committee has decided to hold this hearing at a later date in relation to the publication of the Riksbank's report. Of course, this means I risk having to answer even sharper questions than usual, but it’s all in the line of duty. It is also important that these hearings are held under the best possible conditions. My most important message today is: •  We have now begun to publish our own forecast for the repo rate. This means that we have taken a further step towards increased clarity and openness in monetary policy. •  Inflation rose last year, but was still below the target. One of the main reasons is the substantial productivity growth. Understanding which mechanisms lie behind the strong productivity has been, and is, an important task for the Riksbank. •  The economic prospects are bright.

As employment rises and the lack of labour increases, it is also reasonable to assume that the rate of wage increase will be gradually raised. The Riksbank’s forecast assumes that wage increases will grow as resource utilisation in the labour market rises. A rising rate of wage increase and a stabilisation of productivity increases at a more normal level will mean that cost pressures in the economy increase in the coming years. With more rapid cost increases, price increases will also be greater in the long term. There is thus good reason to believe that inflation will increase during the forecast period. At the same time, what we are expecting is a modest upturn in inflation, despite a strong upturn in employment and relatively high GDP growth. This is due to continuing favourable supply conditions. For one thing, productivity growth is expected to remain at a relatively high level, and for another thing the labour supply will probably increase more than during previous economic upturns. A larger supply of labour  4  BIS Review 17/2007  will hold back the pressure for higher wage increases. Moreover, it appears that international price pressures will remain high. These hold back price increases on imported goods. But I would also like to emphasise that the inflation forecast is uncertain. This is illustrated by the uncertainty bands around the inflation forecast that is included in our report. The uncertainty bands are based on the Riksbank’s historical forecasting errors.
In conclusion, allow me to reiterate the importance of the effective participation of all stakeholders involved in each stage of claims management to ensure high claims service standards and fair treatment of customers. Both insurers and loss adjusters must play their respective roles in value-adding to the claims management process for the effective functioning and positive image of the insurance industry in the long term. 2  BIS Review 53/2010

Major differences from when I last worked at the Riksbank I have worked at the Riksbank twice, during two entirely different regimes – or paradigms, if you wish. The first time was during a period of around fifteen years from the early 1970s to the mid-1980s. At that time, the credit and foreign exchange markets were regulated. The Riksbank determined both the price and size of the credit on offer and had access to tools such as liquidity ratios and lending caps. The Riksbank also had regular meetings with the commercial banks, to closely monitor that they were observing the regulations. The banks were told in no uncertain terms if they had failed on some point. The Riksbank was able to conduct a policy that stabilised economic activity to some extent, but monetary policy – to the extent that one can call it such – was largely subordinate to other economic policy. One important task for the Riksbank during this period was to secure the funding needs of the government and the housing sector. This was of course only possible because the markets  BIS central bankers’ speeches  1  were so strictly regulated and separate from the surrounding world. In other words, the situation was completely different then – although some of the regulation tools used then have begun to come back into fashion, albeit in another form and context.
Coase understood the existence of firms to be a manifestation of how market based exchange between employers and employees was not efficient (see his 1991 Nobel lecture, for example). More recently, economists like Kiyotaki and Moore (an example is their 2002 paper) and many others have built models in which debt markets are incomplete because it is costly to enforce contracts, and which constrain the amount individuals can credibly borrow and pay back. These models can also be used to explain how money comes to exist, as I discuss below. Another body of work that seeks to study the institutions that underpin market exchange is the subject that has come to be known as 'law and economics'. Scholars in this field study the economic origins and consequences of the legal system. See, for example, many works by Gary Becker, Ronald Coase and Richard Posner. BIS Review 102/2006  3  laws, and to abolish the unhelpful ones. And it is that challenge of institutional design to which I now want to turn. As Governor of the Bank of England, you will not be surprised to learn that money is a social institution close to my heart. It is crucial in facilitating exchange and therefore, in allowing the division of labour.

Coase, R (1991), ‘The institutional structure of production’, Nobel lecture. Hayek, F (1976) Denationalization of money, London: Institute of Economic Affairs. King, M (2002), ‘The monetary policy committee: five years on’, Speech delivered to the society of business economists. King, M (2004), ‘The institutions of monetary policy’, Ely Lecture, American Economic Association annual meeting, San Diego. Kiyotaki, N and Moore, J (2002) ‘Evil is the root of all money’, American Economic Review, 92,2,p62-66. Lombardelli, C Proudman, J and Talbot, J (2005), 'Committees versus Individuals: An experimental analysis of monetary policy decision making', International Journal of Central Banking, 1, 5. Machiavelli, N (1515), The Prince. McLean, I (2006), Adam Smith: Radical and Egalitarian, an interpretation for the 21st century, Edinburgh University Press, Edinburgh. O’Neill, O (2002), ‘A question of trust’, The Reith lectures. North, D (1993), ‘Economic performance through time’, Nobel lecture. Rae, J (1895), A life of Adam Smith, Kelley, New York. Rothschild, E (2001), Economic Sentiments: Adam Smith, Condorcet, and the Enlightenment, Harvard University Press, London. Smith, A (1762), The theory of moral sentiments, in The Glasgow edition of the works and correspondence of Adam Smith, vol 1. Smith, A (1766), Lectures on Jurisprudence in The Glasgow edition of the works and correspondence of Adam Smith vol 6: manuscript B, ‘Report dated 1766’. Smith, A (1776), An inquiry into the nature and causes of the wealth of nations, in The Glasgow edition of the works and correspondence of Adam Smith, vol 2.
In this regard, banking institutions have given their commitment to facilitate and advise customers on safe practices in migrating away from cheques to adopt electronic payments. Bank Negara Malaysia and the banking industry will continue the efforts to assist businesses and the general public to ensure a smooth transition in adopting online banking and IBG. This includes the increase of transaction limit for IBG and online banking from RM5,000 to RM10,000 to facilitate high valued payments. With the increase in the limit, 90% of the total  1  2  Affin Bank, AmBank, Bank Islam, Bank Rakyat, CIMB Bank, Hong Leong Bank, Maybank & Public Bank. BIS central bankers’ speeches  number of cheques which is 184 million from 204 million cheques in 2012, or 135 million of 150 million cheques issued in January to September 2013, can be made via online banking. In addition, most of the banks have shortened the crediting time for IBG transactions, in which the beneficiaries will receive their funds faster within the same day. Other initiatives include several major banks will be offering IBG services via ATM and banks have provided access to Internet banking through the deployment of Self-Service Internet Kiosk at all bank branches to facilitate those who do not have access to Internet banking to make payment electronically.

Since the banks themselves have massive investments in this market, they were obliged to make writedowns which, in some cases, were hefty. There is still uncertainty about the volume of additional bank writedowns that will be needed, so that the situation on the international money markets remains tense. In this crisis, central banks have reacted fast and flexibly in order to secure the supply of liquidity to banks and counter distortions on the money market. By means of various measures, the Swiss National Bank was able to stabilise the three-month Libor within the target range, thereby keeping fluctuations in the relative restrictiveness of monetary policy low by comparison with other countries. However, it is not possible to solve the fundamental problems in the banking sector through the flexible deployment of an expanded range of monetary policy instruments; neither can they be resolved by means of coordinated actions on the part of central banks alone. The banks themselves must make a substantial contribution to solving the problems which triggered the current crisis. In this respect, the most urgent matters are transparency with regard to endangered positions and their valuation, increasing the capital base, and improving risk management and control systems. BIS Review 37/2008  1
Taking into account the strategic commitment of our country for EU membership, a few years ago, the NBRM initiated this project of cooperation with the ECB in order to identify the necessary changes in the national regulation, and the needed organization and human resources of the NBRM towards achieving EU central banking standards. The realization of the project, and hopefully, obtaining of a subsequent project for the implementation of the recommendations that will arise from this programme, should enable the NBRM to carry out the process of joining the European System of Central Banks, and later the Eurosystem more easily and efficiently, once the Republic of Macedonia meets the EU accession criteria. Over the past three months, experts from the ECB and the national central banks included in the project, in collaboration with the experts from the NBRM, carried out the activities planned with the first stage of setting the benchmarks according to the European standards and best practices for the operations of the NBRM in ten areas: monetary and exchange rate policy, economic analysis and research, statistics, payment systems, banknotes, accounting, legal services, internal audit, information technology and human resources. As a result of the good cooperation of the experts, their commitment and dedication to the project, at today’s first meeting, the Steering Committee adopted the benchmarks in all planned areas, whereby, I am pleased to say that the first stage of the project has been successfully completed.

This dollar strength has created competitive challenges for U.S. exporters, especially in manufacturing, and has caused the trade sector to be a drag on U.S. economic activity. Looking forward, despite the fact that U.S. economic growth has been disappointing, we have actually made considerable progress toward our monetary policy objectives. The United States is quite close to its employment and inflation objectives. On employment, there still seems to be a bit of slack in the U.S. labor market. But, that margin has shrunk greatly over the past few years. Payroll gains have been at least as robust as anticipated. On inflation, we are still somewhat below our 2 percent objective. But, even here, I think there has been progress. Despite the strengthening of the dollar and the decline in energy prices, core PCE inflation has been quite stable over the past year – currently running at around 1.6 percent. That is not a tremendous difference from our 2 percent objective. So why has the United States done a bit better compared to Europe and Japan in terms of achieving our monetary policy objectives. I think there are a number of contributing factors. First, U.S. household balance sheet repair occurred relatively quickly. This is in part because the housing foreclosure process wiped out many mortgage debts. Part was accomplished by a long period of very slow household debt growth. And part was accomplished by the sharp fall in interest rates that helped cut debt servicing costs.
Lars Nyberg: The framework of modern central banking Speech by Mr Lars Nyberg, Deputy Governor of the Sveriges Riksbank, at the Conference on Reforming the State Bank of Vietnam, Hanoi, 21 March 2006. *  *  *  Thank you for inviting me to this conference on reforming the State Bank of Vietnam. I imagine that one reason why I have been invited here is that the central bank I represent, Sveriges Riksbank in Sweden, just over a decade ago was in a situation which resembles the one the State Bank of Vietnam is experiencing now. At that time we had reached a situation where there were strong reasons – if not imperative ones – for reconsidering the way in which we used to think about monetary policy. It became clear that a reform of monetary policy and its framework was both desirable and necessary. Of course, Sweden is by no means the only country where monetary policy has undergone major changes in recent times. The view of how best to conduct monetary policy has changed fairly radically over the past twenty years and this has been reflected in a more or less worldwide reform process. What I hope to be able to contribute here today – as an introduction to the discussions – is to provide an overall picture of the ideas that formed the basis for this process and to describe what are today considered to be the guiding principles for a modern central bank, according to established research and practical experiences.

It is a question of monetary policy, as I said earlier, being first and foremost aimed at ensuring there is a credible nominal anchor in the economy. As long as this nominal anchor does not risk coming loose, monetary policy can be aimed at stabilising the real economy. I shall return to this shortly and for now merely emphasise that the key word here is stabilise the real economy and nothing else. It may be interesting to note in this context that the experiences from the period of low, stable inflation have meant that price stability is now increasingly perceived as both an objective in itself and as a means of achieving other macroeconomic objectives 5 . There are many indications that price stability has beneficial effects on efficiency and growth in the economy. The reasons can be those I just mentioned, i.e. that the price system functions better as a signalling mechanism in a low inflation environment and that households and companies can spend more time on productive activities instead of trying to protect themselves against inflation. Essentially it is a question of price stability being a necessary condition for an efficient payment system, as I said earlier. In addition, the period of low and stable inflation has also been characterised in many countries by less fluctuations in growth in the real economy than was previously the case.