samchain/econo-pairs-v1 huggingface dataset:
This stress-testing exercise was comprehensive and rigorous, and the results confirm the resilience of EU and euro area banking systems as a whole to severe economic and financial shocks. The stress test has also significantly enhanced transparency regarding the current financial conditions and risk exposures of the 91 institutions that participated in the exercise. Hence, the exercise represents an important step forward in restoring market confidence. 2  BIS Review 104/2010  We also welcome the commitment made by national authorities with regard to the provision of support facilities for banks where private sector means are insufficient. Sound balance sheets, effective risk management and transparent, robust business models are key to strengthening banks’ resilience to shocks and to ensuring adequate access to finance, thereby laying the foundations for sustainable growth, job creation and financial stability. To sum up, the current key ECB interest rates remain appropriate. Considering all the new information which has become available since our meeting on 8 July 2010, we continue to expect price developments to remain moderate over the policy-relevant medium-term horizon, benefiting from low domestic price pressures. The available economic data and survey-based indicators suggest a strengthening in economic activity in the second quarter of 2010, and the available data for the third quarter are better than expected. Looking further ahead, and taking into account a number of temporary factors, we continue to expect the euro area economy to grow at a moderate and still uneven pace, in an environment of uncertainty.

We need this collaborative approach to turn promises into practice. One glance at the NGFS website will show you just how much we are doing on that front.23  22 23  NGFS Climate Scenarios NGFS Website 8  All speeches are available online at www.bankofengland.co.uk/news/speeches  8  Green Finance and Green Recovery  Governments around the world are now considering green recovery packages to rebuild economies hit by Covid-19. Such measures to “build back better” offer a unique opportunity for the financial sector to step up by mobilising green finance to maximise the impact of these packages. The benefits for the financial sector go beyond managing the risks from climate change. Identifying the risks will also reveal the enormous opportunities of supporting the transition. And the innovation that follows will be good for business as well as good for the planet. Indeed, there is increasing evidence of a commercial benefit to sustainable investment, both during the recent market volatility around Covid-19 and over the long-term. 24 It is therefore no surprise that global sustainable funds reached nearly $ trillion in assets under management at the end of 2019.25  Next steps  So where does this leave us and what is next on the climate pathway? I like to think of our journey in phases. The first phase was identifying what risks climate change posed to the financial system and convincing the financial sector of the need to act. We have done this.
With regard to Sweden, a record-low level in the purchasing managers index points to a continued slowdown in economic activity. The purchasing managers’ index for the manufacturing sector fell in October, for the fifth month in a row. Households’ confidence in the economic situation, as reported in the National Institute of Economic Research’s economic tendency survey, plummeted in October to the lowest level since the beginning of 1993. Confidence did not change substantially in November, but remained at a historically low level. The confidence indicator for the manufacturing industry fell further in November and is well below the average. A large number of redundancies have been notified by Swedish companies in both October and November. Inflation fell in October, which was entirely in line with the Riksbank’s most recent forecast, and there are also signs of lower inflation expectations. At the same time, the krona has been weaker than in our most recent forecast, which in all likelihood will somewhat weaken the forces pushing down inflation. The indicators and outcome data that have been received regarding international growth point to a sombre development. The GDP figures for the United States indicate negative growth during the third quarter and a weak beginning to the fourth quarter. The confidence indicators are pointing downwards, the retail trade is weak and orders are falling. The euro area is in a recession as growth was negative during both the second and third quarters. Since the monetary policy meeting on 22 October, growth prospects have deteriorated considerably, both in Sweden and abroad.

However, the large gap remaining between the repo rate and market rates shows that monetary policy cannot resolve the financial crisis. But I would nevertheless like to emphasise that monetary policy fulfils an important complementary function in alleviating the effects of the financial crisis on the real economy. As I described earlier, the stimulating effect of the Riksbank cutting the repo rate has been weakened as the normal link between the short-term market rates and the repo rate has been broken. This situation should gradually change as conditions in the financial markets normalise. When the inflation rate falls again, there will be good opportunities for monetary policy to dampen the economic downturn without jeopardising the Riksbank’s inflation target. Thank you! 8  BIS Review 149/2008
At the same time, Norwegian importers have been able to shift demand to new markets in central Europe and Asia, which has led to a fall in prices for many imported consumer goods. The terms of trade have improved by about 40 per cent since 2002. This has resulted in a vigorous rise in Norway's disposable income. Even excluding oil, there has been a marked improvement. Second: An ample supply of labour has boosted output growth. In particular, the supply of foreign labour has increased sharply after EU enlargement in 2004. Over the past two years, these labour inflows have accounted for over 30 per cent of growth in the labour force in Norway. At the same time, this has enabled Norwegian companies to be bolder in accepting new assignments and making investments, in the knowledge that they can procure labour  BIS Review 100/2007  1  throughout Europe. High inward labour migration and the scope for relocating portions of production abroad have led to increased competition in the labour market and have probably curbed wage growth. Third: The Norwegian business sector has been quick to adopt new technology and to reap the benefits. In comparison with other countries, productivity gains in service sectors stand out in particular. On balance, these factors have contributed to the economy’s high capacity for growth. But strong activity growth has now resulted in a high level of capacity utilisation. Shortages of labour and other factor inputs have been reported.

However, this is not an easy task by any mean. Rating agencies should satisfy several criteria in order to be eligible. These criteria, as you might already be aware of comprise experience, freedom from external influence, publicly available assessments, requirements to disclose assessment models and approaches, sufficient resources and finally validation or recognition by supervisory authorities in our countries. Third but certainly not the least, the new system poses a challenge to all banks to improve their capacities in order to comply with the new framework to successfully compete and survive. Banks should start adopting a more dynamic and forward looking approach to the evaluation of risk and  provisions since under a risk sensitive approach there is always the risk of pro-cyclicality1, which means bank capital ratios are likely to fluctuate more over the course of business cycles. In spite of the above challenges, in Albania we have already started addressing some of these issues. First, by making sure that we have consolidated the achievements of our supervisory function by completing the requirements of Basel I. We are glad that the good progress has been confirmed also by the FSAP assessment during their mission in February-March, this year. Certain recommendations related with requirements about consolidated supervision, will be followed very attentively; Second, we have been pushing already our supervisory process and the banks, toward a more risk oriented attitude.
The standards not only reinforce the safety and soundness of individual firms. In contrast to the development of prudential framework before 2007, we now endeavour to address specifically the risks generated by the financial system as a whole. In other words, the framework is not just stronger. It is macroprudential in a way that was not true at all before the crisis. Of course, knowing where to set the detailed prudential standards that make up the framework is as much an art as a science. It is one thing to know that before the crisis systemic banks were not holding enough capital to absorb losses and keep functioning – one has only to look at the failures, the bailouts and the impact on the real economy. It is quite another to determine how much capital a systemic bank needs to hold to be able to continue to operate through a crisis. As with most things in life, policymakers have looked to the past – for example to the losses suffered by banks and others in this and in previous crises – to guide the future. But we know that it is a useful but an imperfect guide. To paraphrase Mark Twain, history only rhymes, it does not repeat itself. That brings me to the second main element of macroprudential policy. The standing framework can only go so far in addressing risk. The role of macroprudential authorities, like the FPC, is not just to ensure the framework addresses systemic risk.

All this has made our work harder than in the preceding years. Price tendencies I should like to comment first on the high inflation figures. Fluctuations in inflation are commonplace Recently people have been asking whether the higher inflation outcomes constitute a failure. Some years ago, when inflation month after month, not to say year after year, turned out to be lower than we had predicted and below our 2 per cent target, people asked exactly the same thing. I did not see it on the whole as a failure then and neither do I do so now. The lower inflation at that time was mainly due to downward effects of a transitory nature even though the economy was expanding rapidly and capacity utilisation was rising. Similarly, the higher rates at present primarily stem from transitory factors. Earlier we noted that some upward shift in inflation could be achieved in the short run but only by means of drastic interest rate cuts. The corresponding remedy today would be drastic hikes. Such an approach would make interest rate policy erratic and result in unnecessary fluctuations in economic activity. What we can do - and do - is to aim consistently at our 2 per cent target. There is then a good chance of succeeding in the longer run, particularly if economic agents take us at our word and rely on future inflation being in line with earlier assessments.
In particular, we follow measures of market activity, such as trading volumes, bid-ask spreads, trade sizes, quote sizes, financing costs, and settlement fails, as well as other indicators. We also monitor indicators related to our operations, which can provide some direct insight into potential market functioning issues. These include the prices at which we can execute in comparison with prevailing market quotes, the extent and concentration of dealer participation in operations, and the ease of settlement of our MBS purchases. As an example, Figure 3 and Figure 4 show daily trading volumes and failures to deliver in the Treasury and agency MBS market. Based on these types of measures, our operations are going smoothly and market liquidity is holding up well. In addition to this monitoring, we have developed active policies to help prevent market dysfunction as a result of our operations. In the Treasury market, the Desk ceases purchases of a specific security once SOMA holdings of that security reach 70 percent of the outstanding stock. In addition, when SOMA holdings of a specific issue exceed 30 percent of outstanding securities, the Desk limits the rate at which it acquires new holdings of that issue based on a predetermined, graduated schedule. The Desk also refrains from purchasing certain Treasury securities in its operations if investors’ demand for those specific securities as collateral in the repurchase market or as deliverables into Treasury futures contracts is relatively high.

On the contrary, countries that have staked their future on trade and international commitments have managed considerably better both in terms of growth and in combating poverty. There are many instances of this in Asia, for example. As is clear not least from Sweden’s own history, foreign trade is more or less essential for economic development, particularly in the case of small countries. 2  BIS Review 2/2002  In the past two decades world trade has expanded at an average annual rate of 6 per cent, which is twice the rate of global economic growth in this period. Outward-looking countries have tended to grow faster than those which have been more introvert. Countries such as India, Vietnam and Uganda, where the economy has been opened to the rest of the world and trade barriers have been reduced, have been able to combine stronger economic growth with greater success in overcoming poverty. World Bank calculations indicate that the potential benefits from the elimination of all the existing trade barriers amount to between USD 250 billion and 680 billion. Approximately two-thirds of the total would accrue to the industrialised countries but for the poor countries the gains would be twice as large as all the assistance they are currently receiving. Neither are the poor countries’ difficulties in competing with the industrialised countries the primary problem. When borders are opened, companies tend to locate their activities where production costs are lowest; this frequently means developing countries, which accordingly get additional jobs, rising production and increased tax revenues.
At the beginning of 1998 it was assumed that a weaker international trend could be offset by other factors, of which one was the good domestic demand. At an early stage, actually when the Riksbank raised the interest rate in the late autumn of 1997, it was pointed out, however, that the international trend could be weaker than assumed in our main scenario and that the crisis could lead to a slowdown in Sweden as well. The signals of an international slowdown that would also affect growth in Sweden became increasingly clear. The Riksbank therefore successively revised its forecasts in a downward direction and eased the monetary stance in June. This follows from our policy framework, which calls for a lower repo rate when inflation in the forecast period is expected to be below the target and vice versa. The repo rate was cut in two more steps in November, from 4.10 to 3.60 per cent, followed by a further reduction to 3.40 per cent in December when the forecast was revised downwards again. Even after the series of downward revisions during the autumn, the December assessment still carried a downside risk of the international slowdown being even more pronounced and prolonged than expected. The uncertainty about international economic prospects has been accentuated somewhat by the economic problems in Brazil and the real’s depreciation since the turn of the year. The world economy may be affected contagiously, either via real mechanisms or via increased financial market turbulence.

Currencies of countries which, like Sweden, have a high foreign debt were most exposed. The currencies of Australia and Canada, which, like Sweden, target inflation with a flexible exchange rate, depreciated markedly last autumn; in the calmer situation since the turn of the year, these currencies have also strengthened and become more stable. Another factor in the krona’s case is that higher expectations of Sweden joining the euro area have helped push our currency closer to the value implied by economic fundamentals. In the run up to Stage Three there was also some apprehension about how the krona might be affected; after the event, this unrest tended to subside. The Riksbank’s forecast has thus proved to be on the cautious side to date. Nonetheless, I do not consider that developments warrant a revision of our long-term assessment last December, namely a gradual appreciation in terms of the TCW index to about 118 by the end of 2000. Since the publication of the December Inflation Report, interest rates in Sweden have fallen, by almost 0.15 percentage point in the case of the three-month rate and 0.4 percentage point for 10-year bonds. In that inflation expectations have not moved down as much as the nominal interest rates, the real level of interest rates has also fallen and is now historically low. The pronounced downward movement may turn out to have included some overshoot in the market, to be followed by an upward adjustment of market rates. Signs of this have been discernible in recent weeks.
Cross-border European mergers would be particularly positive: they would deepen the banking union, reduce the sovereign-bank risk nexus, and provide greater potential for diversification. In this respect, the ECB Guide on the supervisory approach to consolidation in the banking sector specifically aims to enhance the predictability of supervisory actions for the market and thus help banks design merger plans that are prudentially sustainable, such that the resulting institution has a business plan that, when executed correctly, will add value. 10  Conclusions In sum, a banking sector that was initially healthier and more solvent and forceful economic policy action have allowed the initial impact of the shock of the pandemic to be absorbed and helped keep credit flowing to the economy, thereby preventing systemic risks from materialising. However, the ultimate impact of the crisis on the banking sector will depend both on its scale and duration and on the effectiveness of economic policies in alleviating its effects on households and firms. Economic policies (national, European and international; monetary, prudential and fiscal) should continue to support the economy, targeting the hardest-hit firms and population cohorts. In particular, supporting viable firms whose solvency has deteriorated after a year of crisis is crucial, to prevent the productive system and employment from being destroyed, which in turn would also damage the banking sector’s financial position, thereby hindering the recovery.

First, Thailand’s external position remains strong. Our external debt to GDP has hit an alltime low since 1980, recording 29.4 percent last year. Our foreign reserves doubled within three years reaching over 100 billion US dollar at present day. The amount of foreign reserve has by far exceeded the short-term external debt by more than four times. This provides us an ample room to safeguard against instability from volatile capital flows and exchange rate movements. Second, the government’s fiscal position continues to improve as reflected by a falling trend of public debt to GDP. This gives the government the financial flexibility to tackle economic problems and stimulate the economy if necessary. It is no coincidence that credit rating companies often stated the strength of our fiscal and external position in their underlying reasons for affirming Thailand’s sovereign ratings. In fact, to cite James McCormack, the Head of Asia Sovereign of Fitch Ratings, at the firm’s last week annual Thailand conference, unless political uncertainty significantly undermines Thailand’s future growth prospect, it is unlikely that Thailand will be downgraded, for the country’s sovereign credit fundamentals remain sound. Third, the banking sector remains healthy and strong enough to weather the current global financial turmoil. The BIS ratio remains high and the ratios of NPLs to total loans continued to decline. Together with the implementation of IAS39 accounting standard in 2006-2007 and the adoption of Basel II by the end of this year, the banking sector would be less prone to adverse shocks.
The notion that stablecoin issuers might invest in crypto-assets could further concentrate holdings and contradict the low-risk requirements for stablecoin reserves. 22. Graf von Luckner, C., Reinhart, C.M. and Rogoff, K. (2023), “Decrypting new age international capital flows”, Journal of Monetary Economics, 1 June. 23. Although it represents only a small part of the crypto-asset market, the stablecoin Tether accounts for close to half of all trading on crypto-asset trading platforms. See the section entitled “Stablecoins’ role within the crypto-asset ecosystem” in Adachi, M. et al. (2022), “Stablecoins’ role in crypto and beyond: functions, risks and policy”, Macroprudential Bulletin, Issue 18, ECB. 24. See the May 2023 report by the ESRB Task Force on Crypto-Assets and Decentralised Finance entitled “Crypto-assets and decentralised finance”. 25. A decentralised finance ecosystem is built around crypto lending that is collateralised by other cryptoassets, using smart contracts to implement margin calls. The failure of FTX had a large impact on the price of crypto-assets serving as collateral for crypto lending. This triggered cascading liquidations by crypto lenders because of the decrease in the value of the collateral. 26. See US Securities and Exchange Commission (2023), SEC Files 13 Charges Against Binance Entities and Founder Changpeng Zhao, 5 June. 27. In particular, Mastercard, PayPal and Visa continue building capabilities and strategic partnerships to support crypto-assets (as well as stablecoins). 28. See, for example, JP Morgan’s Onyx Coin Systems Product Team, Fidelity’s Fidelity Crypto℠ account and Citi’s collaboration with METACO to develop and pilot digital asset custody capabilities. 29.

This is a sort of prospectus for crypto-assets that informs potential holders about the characteristics of the issued crypto-asset before they offer a token to the public or list it on a trading platform. 39. See Financial Stability Board (2023), “Crypto-assets and Global “Stablecoins”. 40. See European Central Bank (2023), “Crypto-assets: a new standard for banks”, Supervision Newsletter, 15 February. 41. Panetta, F. (2022), “Demystifying wholesale central bank digital currency”, speech at the Deutsche Bundesbank’s Symposium on “Payments and Securities Settlement in Europe – today and tomorrow”, Frankfurt am Main, 26 September. 42. European Central Bank (2023), “Eurosystem to explore new technologies for wholesale central bank money settlement”, Frankfurt am Main, 28 April.