samchain/econo-pairs-v1 huggingface dataset:
But first of all, what does RMB internationalisation have to do with the mutually beneficial relationship between the Mainland and Hong Kong that I have just mentioned? 6. To answer this, let’s first talk about how Hong Kong, as an offshore RMB centre, has contributed to the internationalisation process. Very few will dispute that offshore markets have played and will continue to play a very important role in the process of RMB internationalisation. Indeed, if we look close enough, the internationalisation of a currency and the development of offshore markets often go hand in hand. If a currency has the 1/4  BIS central bankers' speeches  potential to be an international currency, it will show it in offshore markets. Not only that, the presence of offshore markets will actually help establish and reinforce the global status of a currency. It is hard, for instance, to imagine that the US dollar could attain its current status without a fully developed Eurodollar market. 7. But then what’s so special about us? Hong Kong is not the only RMB offshore market, but we are the one which stands out from our global peers in offshore RMB business. And we offer very unique value propositions such as being part of China and staying well connected to the world, a sound legal and regulatory system, a deep and liquid capital market, a robust financial infrastructure, and a wealth of financial intermediaries and talent.

These long and short-term risks are, of course, linked – any overall misalignment with climate goals increases the short-term risks from a disorderly transition, possibly caused by extreme weather events or abrupt shifts in climate policy. A system-wide stress test can help supervisors and climate policymakers judge the adequacy of the current transition and whether further actions could be expected. As the Bank of England considers the timing and design of such a stress test, we are working with colleagues in the Network for Greening the Financial System (NGFS) to develop a small number of highlevel scenarios.16 And in our Climate Financial Risk Forum we will work with banks, insurers and asset managers to ensure these scenarios are rolled out effectively within their organisations. Together with our work on this year’s insurance survey, these initiatives will provide a basis for our future assessments of the system-wide exposure to climate risks. The third and final area is return A new horizon brings new opportunities. The IEA estimates that the low-carbon transition could require $ in energy sector investments every year for decades – twice the rate at present. Under their scenario, in order for carbon to stabilise by 2050, nearly 95% of electricity supply will need to be low carbon, 70% of new cars electric, and the CO2 intensity of the building sector will need to fall by 80%. With an estimated $ trillion of infrastructure investment expected between 2015 and 2030, smart decisions now can make sure that investment is both financially rewarding and environmentally sustainable.
2 That crisis did not perhaps have such a profound effect on macroeconomic thinking at the global level as it was a more local phenomenon than the latest financial crisis. But for me, it was clear evidence of how costly crises are and how important it is to try to avoid them. It also led to us here in Sweden implementing several important institutional and structural changes to bring more stability and  I would like to thank Mikael Apel for his help in writing this speech and Charlotta Edler, Frida Fallan, Eric Frieberg, Erik Frohm, Jesper Hansson, Pernilla Meyersson, Ann-Leena Mikiver, Åsa Olli Segendorf, Gabriel Söderberg, Ulf Söderström, Anders Vredin and Christina Wejshammar for comments. 1 For an account of how the Great Recession has influenced macroeconomic thinking and what the implications could be, see, for instance, Blanchard and Summers (2019). 2 For a description of the Swedish 1990s crisis, see Lindbeck et al (1994). In conjunction with the crisis and under the leadership of Assar Lindbeck, an economic commission analysed the situation in a short time and proposed guidelines for the formulation of economic policy. ∗  1 [21]  a longer-term perspective to economic policy. This helped us to cope relatively well with the global financial crisis later on. I do not intend to get into the really deep and fundamental issues of the financial crisis here today, but gladly leave these to research.

Figure 5: Calmer developments on the housing market Index, January 2005 = 100. 300  300  250  250  200  200  150  150  100  100  50  05  06  07  08  09  10  11  12  13  14  15  16  17  18  19  50  Sources: Valueguard and the Riksbank. 20 [21]  Figure 6: Similar developments of currencies in small open economies Index, 5 January 2015 = 100. 120  120  SEK per EUR NOK per EUR AUD per EUR NZD per EUR CAD per EUR  115 110  115 110  105  105  100  100  95  95  90  15  16  17  18  90  19  Source: ECB. Figure 7: Declining use of cash in Sweden Percent of GDP. 12  12 Sweden  Norway  Other advanced economies  Euro area  10  10  8  8  6  6  4  4  2  2  0  00  03  06  09  12  15  18  0  Sources: BIS and the Riksbank. 21 [21]
Stefan Ingves: The current economic situation Speech by Mr Stefan Ingves, Governor of the Sveriges Riksbank, at Avanza Bank, Stockholm, 5 May 2009. *  *  *  The minutes of the monetary policy meeting published yesterday show how we Executive Board members reasoned when we decided to cut the repo rate to 0.5 per cent at our monetary policy meeting on 20 April. Today I intend to give my views on economic activity and monetary policy. he central points I wish to take up are: •  The reasons for the global financial crisis and the ensuing recession in Sweden and the world. •  The economic policy measures taken globally and in Sweden to stimulate the supply of credit and cushion the economic downswing. •  The most recent developments in the Swedish and international economies. •  My arguments for cutting the repo rate to 0.5 per cent, the repo rate path and possible new unconventional monetary policy measures. The financial crisis is a consequence of several factors High saving in China and oil-producing countries has contributed to low interest rates and credit expansion in a number of countries From the beginning of the 1990s up to 2005 the US current account deficit increased substantially. The main explanation for this was a reduction in saving among households. The US current account deficit is counterbalanced by a surplus above all in China and a number of oil-producing countries where saving is high.

However, the Riksbank can stimulate the economy further in other ways without needing to cut the repo rate to zero. The most important measure concerns ensuring that the real interest rate, that is, the repo rate adjusted for inflation expectations, is sufficiently low. This can be done by influencing inflation expectations, which is made easier as we have a numerical inflation target and we publish forecasts for both the inflation rate and the repo rate. We can, for instance, announce that we are going to hold a low repo rate for a longer period than we assumed at the monetary policy meeting in April and show how the inflation path will then approach 2 per cent more quickly than otherwise. This would raise inflation expectations. A further possibility would be for the Riksbank to contribute to pushing down the rate on government bonds, housing bonds or commercial paper by purchases in these markets. There may also arise a portfolio balance effect if other market participants’ demand for corporate bonds, for instance, were to rise as a result of the Riksbank's purchase of government bonds. However, there is reason to await a more detailed analysis of the need for, and possibilities with, these measures. There are also a number of legal issues surrounding this type of measure that must be taken into account before such measures are implemented. At the most recent monetary policy meeting I did not consider that it was yet time to do anything other than cut the repo rate.
The policy rate is an ineffective instrument for influencing financial stability, and policy rates high enough to have a noticeable effect on credit growth and house prices will have a strong negative effect on inflation and resource utilisation, even in sectors that are not experiencing any speculative activity. The use of the policy rate to prevent an unsustainable boom in house prices and credit growth poses major problems for the timely identification of such an unsustainable development, as well as for the assessment of whether policy-rate adjustment would have any noticeable impact on the unsustainable development, and of whether, in the longer run, the outcome for inflation and resource utilisation would be better.3 Thus, it was financial-stability policy that failed, not monetary policy. Monetary policy in the form of flexible inflation targeting – applied in the right way and using all the information that  1  For instance, the Federal Reserve’s mandate-consistent inflation rate has to be inferred from the Federal Open Market Committee participants’ longer-term inflation forecasts, whereas the Riksbank has an explicit inflation target; the Federal Reserve’s Greenbook and Bluebook (now replaced by the Tealbook) are published with a five-year lag, whereas the Riksbank publishes an extensive Monetary Policy Report or a shorter Monetary Policy Update (which also include a policy-rate path) after each policy meeting; and the Federal Reserve’s minutes are non-attributed but attributed transcripts are published with a five-year lag, whereas the Riksbank’s minutes are attributed.

In the realistic case when the state variable affecting the probability of a financial crisis is a vector that includes not only leverage but, for instance, maturity mismatch and liquidity mismatch, it is even more the case that additional financial-stability instruments such as restrictions on maturity and liquidity mismatches are superior to the policy rate in achieving and maintaining financial stability. BIS central bankers’ speeches  5  for many years for several reasons, including global imbalances, fiscal policy, and shocks to aggregate demand and supply. This confusion means that the conclusions from this work for monetary policy are not clear. Monetary-policy instruments The standard monetary-policy instruments are the policy rate and communication, including statements and the publication of forecasts of inflation, the real economy and (by some central banks) the policy rate. During the financial crises, in particular when the policy rate is at or close to the zero lower bound, we have seen other more unconventional instruments being used to implement more expansionary policy, as noted above. There is a lively debate and a considerable body of research on the effects of the LSAPs undertaken by the Federal Reserve. Estimates based on a number of recent studies, as well as Federal Reserve estimates, suggest that, all else equal, the Federal Reserve’s QE2 program launched in November 2010 lowered longer-term interest rates by 10 to 30 basis points.
4  All speeches are available online at www.bankofengland.co.uk/speeches  4  Headline CPI was blown about during this period by external pressures – the collapse of the oil price, and the creeping but sizeable appreciation of Sterling between the end of 2014 and the end of 2015. But the MPC’s stodginess in the face of deep uncertainty about the supply side was justified by the very subdued evolution of domestically generated inflation even as unemployment rate sank well below its pre-crisis natural rate and activity recovered towards pre crisis growth rates of around 3% in 2014 (Charts 5 & 6).

While several emerging economies have successfully relied on macro prudential measures to contain the formation of such asset bubbles, the foreign exchange market is not like any other market. With a daily transaction amounting to USD4 trillion, it is the most liquid and dynamic market in the world. The role of sentiment and expectations has resulted in a market that is frequently prone to excessive movements and overshooting. As highly open economies, disruptions and disequilibrium in the foreign exchange market have far reaching consequences in the real economy. Intervention operations to maintain orderly market conditions reinforced by sterilisation operations have aimed at ensuring liquidity in the market and at ensuring that the market conditions reflect the underlying economic fundamentals. Similar to the presence in other financial markets, this is to ensure the sustainability of the efficient functioning of the market. Central banks and crisis containment and management The world going forward is likely to continue to be affected by financial crisis. History has shown that there have been more than a hundred distinct banking crises in this recent two decades. The prospect of surviving such a crisis is not only about building resilience but also having the capacity to manage it. Central banks have a critical role in crisis containment and management, in particular, to provide liquidity, to restore the efficient functioning of financial markets, to lead resolution programmes and to restore confidence to the financial system.
Responses to those sorts of questions can, for instance, help us work out how businesses have been affected by the recent depreciation of sterling, and the tightening in credit conditions. A fourth use of the surveys is in providing measures of variables for which there is no official counterpart. In particular, the amount of economic slack in the economy is a key determinant of inflationary pressures. We have official indicators of slack in the labour market – unemployment, vacancies and the like – which is one factor determining pay growth. But we have no official measures of the amount of slack within businesses, which potentially affects pricing pressures. Business surveys such as the Industrial Trends survey do, however, ask how intensively firms are working their capital (see Chart 5). And the MPC draws on this  4  BIS Review 95/2008  information in forming a judgement about the overall margin of spare resources in the economy. A fifth, and perhaps less obvious, use of survey information is in refining our picture of the past. I noted earlier that the official data tends to get revised for some while after it is first released. But it turns out that there are some systematic patterns in the historical revision process. Moreover, for some series, we have found a tendency for revisions to be in the direction of reducing the discrepancy with the corresponding survey information.

Charles Bean: Business surveys and monetary policy Speech by Mr Charles Bean, Deputy Governor (Monetary Policy) of the Bank of England, at the CBI Industrial Trends Survey 50th Anniversary Reception, Centre Point, London, 24 July 2008. *  *  *  Good evening! It is a great pleasure to be asked to say a few words to mark the 50th birthday of the CBI’s Industrial Trends survey. The birthday boy and I have, in fact, been acquainted with each other for over thirty years – from when I started my professional career in 1975 as a forecaster in the Treasury. In those days, the quarterly Industrial Trends survey was really the only game in town as far as business surveys go. Since then, the field has become more crowded, but the Industrial Trends survey remains a key source of information about business developments. To celebrate the survey’s birthday, I thought that I might say a few words tonight about the part played by business surveys, and intelligence about business conditions more generally, in our setting of Bank Rate each month. Because our interest rate decisions affect UK economic activity and inflation with a rather long, and sometimes rather variable, lag, there is nothing much that we can do to affect the current and near-term rate of inflation. That is already largely baked into the cake. Instead we have to focus on inflation prospects in the medium term – that is, two years or so ahead.
A major reason is likely to be the advanced globalisation of the money and capital markets and increasingly parallel international economic and price developments. Another cause may well be unconventional monetary policy measures, in particular the extensive QE programmes, which have caused bond and equity prices to rise simultaneously. Ultimately, large-scale securities purchase programmes lead to lower interest rates and reduce the supply of risk-free assets. This, in turn, leads investors to rebalance their portfolios towards riskier asset classes such as equities – which, from a monetary policy transmission standpoint, is certainly desirable. 10 In the end, rising asset prices should stimulate consumption and investment, as well as consumer prices. A related issue is the degree to which higher equity prices in the current situation can be interpreted as a sign of an improving economic and profit outlook. It is intuitively obvious that corporate earnings and equity prices move in unison – at least in the longer term – and are therefore positively correlated. However, for some time now, we have observed a negative correlation – while both actual profits and expectations have declined, equity prices have risen to new record levels, as depicted by the yellow lines. Chart 6 shows the US S&P 500 equity  10  Lower interest rates also lead to higher equity prices as they reduce the discount factor for future dividends. Page 7/8  index (blue line) and the corporate earnings per share expected for the next 12 months (red line).

Balance sheet measures turn central banks into financial market players  Let me now turn to balance sheet measures. Here, the central bank enters the financial markets as a major participant. In the case of quantitative easing, or QE, it will often purchase medium and long-term government bonds with the aim of lowering the relevant interest rates. 5 As well as government bonds, some central banks have extended their purchase programmes to include other asset classes, including asset-backed securities, covered bonds and corporate bonds. At the Bank of Japan, the purchase programme also encompasses certain equities 6 and shares in real estate funds. In chart 3, you can see that a QE programme impacts directly on a number of financial markets. This more direct influence of monetary policy on a broader segment of the financial markets is evident in the extent and impact of the QE programmes. Chart 4 shows the impact of the QE programmes by the Federal Reserve, the European Central Bank, the Bank of England and the Bank of Japan. 7 The chart is based on findings from a total of 24 studies which estimated the impact of each securities purchase programme on capital market rates. The blue bars show the breadth of the estimated impact of each QE programme. The red diamonds indicate the respective median. We can see that the QE programmes across the different currency areas may have reduced the yields on ten-year government bonds by over half a percentage point on average.
For this, it is important that we are well prepared for the next round of evaluation on Malaysia, which may be scheduled from the next year onward. From our past experience, a national AML/CFT assessment demands the joint efforts of all stakeholders, including the financial institutions. Participation, contribution and cooperation by all stakeholders are very critical in ensuring that the result of the assessment truly reflect our strong commitment in not  2  BIS Review 99/2010  only meeting the international standards, but also in achieving the desired result in combating ML/TF. Therefore, I wish also to call upon all stakeholders of our AML/CFT regime at every level to make due preparation for the coming assessment on Malaysia, while continuing our concerted efforts in preventing for the interest of the country, against ML/TF risks. Shifting gear of AML/CFT implementation action Let me now touch on the second area in terms of policy and strategic response of authorities. The Anti-Money Laundering and Anti-Terrorism Financing Act 2001 (or AMLATFA) has been in operation for the past eight years with the basic foundation of the required framework, such as legal, regulatory and institutional infrastructures, already in place. In the 2007 Mutual Evaluation exercise, Malaysia is recognised as having good AML/CFT framework through good ratings obtained in many areas, comparable to those jurisdictions with excellent AML/CFT framework.

We published one such measure in our 2020 TCFD20-aligned climate disclosure report21, which suggested that the CBPS – like the sterling corporate bond market it echoes – is aligned with an unsustainable 3.5°C. These metrics are promising, but very sensitive to their underlying assumptions: alternative measures for the same portfolio ranged from <1.75°C to 4°C (Chart 7). This degree of variation complicates their practical use for target setting. Chart 7: Uncertainties over implied temperature rise metrics  Source: The Bank of England's climate-related financial disclosure 2020  Some frameworks also advocate reserving a share of the portfolio to ‘green bonds’, or other assets linked directly to emissions-reducing activity. The market for sterling green bonds is currently small (Chart 8). But the planned launch of a new green gilt issuance programme should catalyse new corporate issuance, broadening the range of instruments available to sterling investors, including the CBPS. 20 21  Task force on Climate-Related Financial Disclosures: https://www.fsb-tcfd.org/ https://www.bankofengland.co.uk/-/media/boe/files/annual-report/2020/climate-related-financial-disclosure-report-2019-20.pdf. 12  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  12  Chart 8: Outstanding global green bonds by currency  Source: Bloomberg. Having set an overall target, our second and third tools – tilting and eligibility – will play the key role in influencing incentives for transition. We propose to tilt future CBPS purchases towards issuers which are performing relatively strongly in support of net zero, and away from those that are not.