samchain/econo-pairs-v1 huggingface dataset:
And this process is very much an automatic one which does not require the exercise of discretion on the part of the HKMA. There is no active foreign exchange market intervention as such, and certainly no money market operations for recycling Hong Kong dollars sold to the HKMA when there is capital outflow; or sterilization of Hong Kong dollars passively provided to the market by the HKMA when there is capital inflow. Even until now, after we have been operating such a system successfully for over fourteen years, this technical strength of our exchange rate system and the important technical distinction from other fixed exchange rate systems are still not very widely appreciated. But I cannot really blame the uninformed. Perhaps we have not done enough to keep them informed on these admittedly rather esoteric monetary issues. 20. And the situation is not helped by ourselves also armed with the usual central banking armoury of being in a position to exercise discretion to influence monetary conditions in the interbank market by virtue of the fact that we run the interbank clearing system and therefore also serve as the lender of last resort in facilitating day to day interbank clearing. There has been some concern that the HKMA might then be subject to political influence to exercise discretion and use the central banking armoury to create money in order to relieve the interest rate pain and in the process undermine the credibility of the currency board arrangement itself.

However, and this is a point I have made elsewhere, monetary policy is too blunt an instrument for addressing specific risks to financial stability, and it can sometimes cause collateral damage to the rest of the economy if it tries to do so. [10] An integrated policy framework could perhaps shed light on the circumstances under which monetary policy could also serve financial stability objectives, and whether there are benefits to jointly calibrating monetary policy and macroprudential policy, as well as how this calibration should be done. The BIS and IMF have both been undertaking research on these issues. Central bankers have at the same time gained considerable experience in employing an eclectic mix of policy instruments, with varying degrees of success. There is merit in bringing these practical experiences to bear in formulating an integrated policy framework. Conclusion Developing eﬀective policy instruments and using them in a coherent fashion will enhance macroeconomic and macro-financial stability. It will help to make financial globalisation safer, especially for EMEs, at a time when there are growing risks of fragmentation in international economic relationships. Your task is therefore vital. I wish you a fruitful conference ahead. [1] IMF Balance of Payments, IMF International Financial Statistics, MAS calculations. [2] Fratzscher, M., Lo Duca, M. and Straub, R. (2013), “On the international spillovers of US quantitative  easing”, ECB Working Paper No. 1557; Bhattarai, Chatterjee, and Park (2017), “Global Spillover Eﬀects of US Uncertainty”, Fed Reserve Bank of Dallas, Working Paper No.
The fourth article of the Central Bank Law states that the Bank is responsible “ to monitor the financial markets; to regulate the volume and circulation of the Lira, to establish payment and securities transfer and settlement systems and to set forth regulations to ensure the uninterrupted operation and supervision of the existing and future systems and to determine the procedures and conditions of reserve requirements and liquidity  5  Hoggarth, G. Reidhill, J. Sinclair, P. (2004). On the Resolution of Banking Crises: Theory and Evidence. Bank of England Working Paper. No.229. BIS Review 38/2005  5  requirements by taking into consideration the liabilities of banks and other financial institutions as deemed appropriate by the Bank.” In this article it is also stated that the Bank will take measures for enhancing the stability in the financial system and take regulatory measures with respect to money and foreign exchange markets as well. Hence, The Bank is equipped to take necessary measures in times of external shocks and in fact proved that during the 9/11 event and also the Iraqi War in 2003. Distinguished Participants, After the 2001 crisis, besides amendments in the Central Bank Law, many steps were immediately taken to strengthen the financial sector. At first, the “Banking Sector Restructuring Program” was put into practice in May 2001. The main goal of the program was to eliminate the distortions in the financial sector, improving its intermediary function and thus enhancing its competitiveness by international standards.

The most important result of international efforts aiming at sound financial markets was the approval of modern risk management techniques as a part of regular financial intermediation process. In this context the Basel II, the new capital adequacy framework, is a very important outcome of the action taken in the international arena. Although, the main aim of the original Basel Accord, which was applying institutionalized and international standards to the global financial system, has not changed in the Basel II Accord, the Basel II puts more emphasis on the risk management aspect of the financial intermediation process. It is expected that a sound and resilient risk management in the banking sector would also lead to more efficient risk management in the real sector. Therefore, in this way, as the financial system becomes more stable, less pro-cyclical and reinforced against shocks, more sources will be available for the real sector. However, it should also be considered that healthy and efficient risk management requires more than the three main pillars of the Basel II Accord. A good understanding of the risks that a financial institution might encounter, a clear definition of risk taking procedures, compliance of risk taking decisions with the strategic goals of the institution, ensuring the risks are within the limits that were set by the management and adequate capital for given risk structure are other essential elements for a more significant advance in risk management in financial institutions.
Second, regulations will continue to focus more on facilitating market-led adjustments that will allow the industry to evolve in response to market developments, while maintaining a sufficient degree of regulatory oversight to maintain financial stability and public confidence. This includes the adoption of principles-based regulations and an increased focus on harnessing market forces and discipline, as well as internal oversight functions, to reinforce prudential regulation and supervision. The aim is to promote a more efficient and responsive financial system. In this connection, Bank Negara will soon introduce a more facilitative process for product innovations with revisions to the new product approval framework. The changes are aimed at improving time to market for the introduction of new products by financial institutions, while ensuring that institutions put in place a sound product management programme within their respective institutions. The new framework will provide for more simplified regulatory processes and allow greater flexibility for well- managed banks and insurers to introduce new  BIS Review 83/2007  3  products more quickly in the market. Qualifying banks and insurers are expected to exercise this flexibility responsibly and in particular, with due regard to the interests of consumers. The realignment of the regulatory and supervisory structures within the Central Bank in November 2006 has marked a significant turning point in consolidating these regulatory changes.

The sector, in the banking and insurance industries, now provides employment to more than 123,000 Malaysians. Despite conditions that have remained challenging for a large part of the decade, the banking system remained consistently on solid financial ground with a risk-weighted capital ratio of over 13%, low NPL ratios, and continued profitability for eight consecutive years. Substantial progress has been made towards consumer retail finance and access to banking services. Such consumer lending has increased from RM134 billion to RM343 billion while loans disbursed to small and medium enterprises have increased from RM71 billion in 2000 to RM108 billion in 2007. Domestic banking institutions are also building on their strong domestic performance to expand beyond Malaysian borders. Today, six domestic banks have presence in 10 countries around the region. The current encouraging state of the banking system, however, should not make us complacent on the need to continually transform and reinvent. The road in front of us is likely to be significantly different from the one we have traveled on. As our previous experience has shown, we need to constantly recognize that strategies that serve well in today's environment would not necessarily be a formula for success in tomorrow's environment.
Sweden also gives advice to countries wishing to improve their application of these norms. Riksbank employees have provided assistance in countries all over the world, including Latvia, Poland and Sri Lanka. A good example of internationally agreed norms for increasing stability on the financial markets is the capital adequacy rules for banks that were developed by the Basel Committee. These rules came into force in 1988 and cover risks in for example lending, interest rate trading and foreign exchange trading. In principle, they require that the greater the risk taken by a bank, the more capital it must hold. As it costs money to hold capital, this creates an incentive for the banks to reduce their risk taking. The rules also increase the banks' opportunities to cover any losses they may incur. The current rules are applied in more than 120 countries. The proposal for new capital adequacy rules recently presented makes an even closer connection between the capital requirement and the risks taken, as well as reducing regulatory arbitrage and increasing the requirement for transparency. While the Basel rules thus reduce excessive risk taking, they do not impair transactions made with the purpose of redistributing risks between banks, enabling a healthy level of risk taking to be attained within the respective institute. These transactions contribute to reducing the banks' risk taking and currently comprise a large part of the turnover on the foreign exchange market. Allow me to give an example of how this works.

A Swedish export company with income in dollars, but paying out wages and taxes in kronor, must exchange dollar income for kronor. The company transfers the foreign exchange risk to the bank, by selling dollars for kronor. This can be done in two ways: either the company sells the dollars when it receives them, on the spot market, or it sells its future dollar income as soon as it receives an order, on the forward market. In both cases the bank buys dollars and thus takes over the foreign exchange risk. The bank also makes a charge for doing this. Today the margins in foreign exchange trading are 0.02 per cent. The bank's foreign exchange risk thus increases, unless another client happens to make an equally large foreign exchange transaction in the opposite direction at exactly the same time, ensuring that the bank's holdings of various currencies remains unchanged. This is, of course, very unlikely. The export company's foreign exchange transaction therefore gives rise to several transactions between banks, with the aim of distributing the foreign exchange risk throughout the banking system. This means that the clients' purchases and sales of various currencies and in various banks are matched against one another, to avoid an increase in the total risk in the banking system. The first foreign exchange transaction will therefore lead to many new transactions before all of the banks have once again achieved a healthy level of risk taking.
By many measures, nations and people are closer than ever in terms of trade, investment, information exchange and physical mobility. Despite the weakness in growth and trade activities, global flows of goods, services and finance is still more than one-third of global GDP, 150% the level in 1990. Yet, social disparities, most noticeably inequality in the distribution of income, have worsened considerably. Income inequality has risen in many OECD countries since the 1980s1; we in Asia have not fared well either, with an average Gini coefficient that is higher than the rest of the world 2. The distance between the reality that we live in and our idea of an ideal construct of society is thus at once both closer and further than it was in our parents’ generation. The issues underlying this paradox are complex and different for every nation. In many ways, it is 3/8  BIS Central Banker's Speeches  driven by the very forces of globalisation that have brought our economies closer together, but at the same time undermined the welfare of the middle-class in advanced economies and driven the ‘haves and have-nots’ further apart in the emerging economies. The problems confronting us today are different from the past. The implications for policymakers and social thinkers are therefore, immense. These new challenges require more nuanced understanding and approaches, and because of this, our frameworks need to adjust accordingly. For a start, it is important to recognise that new challenges can arise as a by-product of a genuinely positive development.

The socio- and geopolitical paralysis that is splicing the centre towards the far-left and far-right in so many parts of the world can be traced back to the unequal sharing of global economic progress in past decades. This underscores the importance of broader-based economic growth and the urgency 7/8  BIS Central Banker's Speeches  to close the inequality gap. Leaders from the public and private sectors must help boost labourmarket participation; across genders, creed and nationalities and cushion any negative social costs that may arise as a by-product of growth. Only by reawakening growth, reigniting productivity and restoring inclusiveness, can we reclaim a positive and sustainable future. On that note, I would like to congratulate MIER on its commitment to research this past 30 years. It is my hope that MIER will continue to produce quality policy-informative-research, strengthening the synergies that exist between policy-making and research efforts. Finally, my wish is for MIER to become the leading “global bearer” for economic research in Malaysia; a think-tank that matters, to the sound policy formulation of the nation. Thank you. 1 Income Inequality: The Gap between Rich and Poor, B. Keely (OECD Insights, 2015). 2 Sharing the Growth Dividend: Analysis of Inequality in Asia, S. Jain Chandra et al. (IMF Working Paper, 2016). 3  The Morning Ledger: Productivity Slump Threatens Long-Term U.S. Growth, W. Azeez (Wall Street Journal, 2016). 8/8  BIS Central Banker's Speeches
These efforts should be put to more productive use. With price stability and trust in place, the list of economic benefits is long. In particular, the price development becomes more stable and predictable. This allows financial markets and businesses to operate more efficiently. As for the National Bank, it can conduct monetary policy more easily with expectations strongly anchored. A key feature of trust is that it must be underpinned by transparency. We too have learned from past experience that Swiss monetary policy gains from increased transparency. Earlier than most central banks, we have embraced the notion that it is better for the conduct of monetary policy if people can understand what their central bank is thinking, doing and why. Transparency also eliminates the doubts that the central bank is working with an informational advantage. Information asymmetries breed mistrust and skepticism. It is much easier to instill trust in an institution if it is open about its goals and strategies. All this enhances the National Bank’s accountability and reinforces the trust we have fostered. What steps has the National Bank taken to improve the transparency of monetary policy? We have a long tradition of setting monetary targets, but since the announcement of our new monetary strategy more than two years ago, the discussion of monetary policy is even more clearly defined by norms, rules and procedures than before. The explicit definition of price stability gives Swiss citizens a yardstick for measuring how the central bank has performed.

Last September, 14 major financial institutions and their principal supervisors met at the Federal Reserve Bank of New York to undertake a concerted program of improvements to the infrastructure that supports the OTC credit derivatives market. When that group reconvenes next week, we will review the extent of progress in reducing the backlog on unconfirmed trades and increasing the number of trade confirmed through automatic systems. We will also assess the progress toward agreement on a protocol for settlement events. And we will review new commitments to expand this effort to other OTC derivatives, including equity derivatives. These priorities for policy and supervision have the potential to strengthen our financial system and make it more robust to real systemic events. To be effective, however, we must continue to explore ways for supervisors and regulators to cooperate more closely together. The changes in market structure and financial innovation during the past decade, along with the increased global integration of capital markets, have increased opportunities for regulatory arbitrage. Policy initiatives that focus  BIS Review 85/2006  7  only on the U.S. market or on a specific class of institutions will push the activity to other markets or other institutions, raising costs on the regulated intermediaries without reducing overall risk in the system. Balancing the imperative of a cooperative approach across markets and institutions with the need for a more agile response to the rapid pace of evolution in markets will be a continuing challenge.
The decision on whether monetary policy measures in the form of foreign currency purchases are necessary is based on an evaluation of the threat of deflation and the monetary policy expansion needed in order to counter this. Monetary policy inaction during the dramatic phases of 2009 and 2010 was not an option. The primacy of monetary policy applies, and the top priority of monetary policy is to ensure price stability. The SNB’s legal mandate is explicit in this regard. This is the contribution which the SNB can and must make to economic prosperity in this country. BIS central bankers’ speeches  1

This study, which we expect to be completed by the end of 2017, will include various original aspects to address the special characteristics of the Spanish case. First, educational skills are decentralised. Given the nature of financial competence, which varies significantly according to the level of education of the individual concerned, the project will use representative samples of the different levels in the various regions. Second, the financial knowledge of each individual may not reflect that of the persons who actually take household decisions. For example, in Spain, important financial decisions regarding house purchase and mortgage borrowing are taken at different ages than they are in other European countries, as a high proportion of young people live with their parents. As a result, information is sometimes needed on the financial competence of those members of the household who take saving and borrowing decisions affecting the whole household. 4/5  Apart from its financial knowledge, we have little evidence regarding the general economic knowledge of the Spanish population. Given this situation, questions have been included in the financial competence survey that aim to measure, inter-alia, knowledge of certain key concepts, such as inflation and money. In 2018 we will have the results of the survey, which will enable us to analyse on a sound basis the financial knowledge of the adult population in Spain and to identify those areas on which the Financial Education Plan needs to focus. Future activities will be based on this information.
Chart 7: Average risk weights for major UK banks by counterparty(a)(b)  Chart 8: Average risk weights for major UK banks under different approaches (a)  Per cent 100  Per cent 120  80  100  Basel II IRB Approach Basel II Standardised Approach Basel I  80  60  60 40 40 20 0  20 (c)  Financial Households Other institutions corporates  SMEs  Sources: Bank of England, FSA regulatory returns and Bank calculations. (a) Based on June 2011 data for Barclays, HSBC, LBG, Nationwide, RBS and Santander UK. (b) Cover credit and counterparty credit exposures. (c) Financial firms other than regulated banks and investment firms are included within ‘Other corporates’. (d) Only includes data on SME credit exposures from internal ratings based portfolios. 12  (d)  0 Sovereigns  Banks  Corporates  Retail Other retail mortgage  Source: Pillar 3 disclosures, Bank calculations (a) As of end-2011. Weighted average. BIS central bankers’ speeches  Chart 9: Survey responses to “How much do you trust risk weights?”(a)  Chart 10: Survey responses to “Has your confidence in risk-weighted assets gone up or down?”(a) Per cent 70  45% 40%  60  35% 50  30%  40  25% 20%  30  15% 20  10%  10  5% 1 - not trustworthy at all Source: Barclays Capital.

We, Europeans and Japanese, shoulder-to-shoulder with Canada and others elsewhere, must resolutely defend international economic relations based on commonly respected rules and multilateral institutions: their deterioration would dampen world trade and economic activity. In a recent speech, the Governor of the Bank of Japan, Haruhiko Kuroda, stressed “the importance of multilateral cooperation”. He said: “Economies must overcome their narrowly-defined self-interest so as to cooperate and coordinate from a broader perspective […]. It requires a well-functioning institutional framework such as the IMF, multilateral development banks (MDBs), and the G20.” i These words are particularly relevant in the current context. II. Regional responses: the case of Europe  Let me now turn to my second point: regional responses, taking Europe as the example. The European Union is a unique case of very advanced cooperation between countries at a regional level. The cooperation is obviously multifaceted, but today I would like to focus on three shared economic and social assets of Europe: its single currency, its single market, and its unique social model. Page 3 sur 6 Three European assets: its single currency, its single market, and its unique social model. First, with the euro, we share a solid currency which is recognised worldwide. Let me say it straight away: the Monetary Union can be considered as one of Europe’s greatest successes. As you know, the single currency was officially launched with the Maastricht Treaty in 1992 and introduced in 1999.