samchain/econo-pairs-v1 huggingface dataset:
Page 16 of 19  Figure 15 Sovereign rates' volatility, EM (1)  Exchange rate volatility, EM (1)  (basis points)  (annualized percent)  P25 - P75  25  Chile  Commodity exporters (2)  25  25  20  20  20  15  15  15  10  10  10  5  5  5  0  0  0  16  17  18  19  20 Nov.  16  17  18  19  20 Nov.  (1) EM includes Brazil, China, Colombia, Hungary, India, Indonesia, Malaysia, Mexico, Peru, Poland, Russia, and Turkey. (2) Includes Australia, Canada, New Zealand, and Norway. Source: Central Bank of Chile based on Bloomberg data. Figure 16 Uncertainty (*) (Dec.2018=100)  300  300 Chile  250 200  250 200  150  Global  150  100  100  50  50  0 18 Dec.18  0 19 Apr.19  19 Aug.19  19 Dec.19  (*) In both cases the Economic Policy Uncertainty (EPU) index is used. Sources: Bloomberg and CLAPES UC.

Meier, S. and Sprenger, C. (2008): Charging Myopically Ahead: Evidence on Present-Biased Preferences and Credit Card Borrowing. 10  Shefrin, H. (2012), Behavioral Finance in the Financial Crisis – Market Efficiency, Minsky, and Keynes, discussion paper available at www.russellsage.org/blog/new-research-crisis-and-regulation-financial-sector. 11  Thaler R., Sunstein C. (2008), Nudge – Improving Decisions about Health, Wealth, and Happiness, Yale University Press. 12  A “default” option or “no action required” option could substantially boost participation in pension plans as individuals do not actively have to decide whether or not to make a contribution to savings. However, it does not inhibit their individual freedom to choose, as they can still adjust their contributions. BIS central bankers’ speeches  5  O’Donoghue, R. (1999): Doing it now or later, American Economic Review, Vol. 89, No.1. Rajan R. (2010), Fault Lines, Princeton University Press. Reinhart, C. and Rogoff K. (2010), Growth in a Time of Debt, American Economic Review, American Economic Association, vol. 100(2). Schumpeter, J. (1934), The Theory of Economic Development, Duncker & Humblot, Leipzig. Trans. R. Opie (1934), Cambridge, MA: Harvard University Press. Shefrin, H. (2012), Behavioral Finance in the Financial Crisis – Market Efficiency, Minsky, and Keynes, discussion paper available at www.russellsage.org/blog/new-research-crisisand-regulation-financial-sector. Thaler, R. and Sunstein, C. (2008), Nudge – Improving Decisions about Health, Wealth, and Happiness, Yale University Press. Worldbank, World Development Indicators, FS.AST.PRVT.GD.ZS/countries/1W?display=graph. 6  http://data.worldbank.org/indicator/  BIS central bankers’ speeches
Sources: The National Institute of Economic Research, the National Mediation Office, Statistics Sweden and the Riksbank  This development has not been unique to Sweden; we have seen similar tendencies in several other countries, see Figures 4a–d. In the euro area, the other Nordic countries and the United States, both inflation and wage increases have been lower after the financial crisis. At the same time, resource utilisation in terms of labour shortages has been at roughly the same level as prior to the financial crisis and policy rates have been very low in an historical perspective, as in Sweden. The United Kingdom stands out with a somewhat higher inflation and Germany stands out with higher resource utilisation following the financial crisis. No consensus has yet emerged among economists and researchers regarding the causes of the relatively low outcomes regarding prices and wages, either in Sweden or abroad. During the years immediately following the financial crisis, the low inflation in Sweden was said to be explained by weak international economic activity combined with low energy prices that held back cost increases. Other causes were a stronger krona and companies having squeezed their margins to a greater extent than previously. 10 On a general level, the increasing globalisation and technological developments, with an increasingly rapid digitalisation, are probably important causes behind the low increases in prices and wages. Now that more products are being produced in  10 See Andersson et al. (2015).

However, owing to the strong M3 growth in 2001, there is still a lot of liquidity in the economy. We therefore have to monitor monetary dynamics closely in the coming months. The persistence of excess liquidity in the economy could become a concern once the economic recovery in the euro area gathers pace. Turning to economic developments, the latest information has reinforced our expectation that real GDP growth in the euro area will recover in 2002 and that, later in the year, it should again be back in line with potential growth. The recovery should be supported by both domestic and external factors, in an environment in which financial conditions are favourable and where there are no major imbalances in the euro area. However, at the current juncture, some uncertainty still remains regarding the strength of the recovery. As regards price developments, there is no evidence thus far of a significant upward impact on the overall price level from the euro cash changeover. While some shorter-term effects cannot be ruled out, there is reason to believe that the introduction of the euro banknotes and coins will strengthen competition, thereby supporting the maintenance of price stability over the medium term. This notwithstanding, HICP inflation is currently somewhat higher than was expected a few months ago, owing partly to a significant rise in oil prices.
To be sure, as populations age and productivity growth slows, potential growth rates around the world are projected to moderate. But Asia is poised to remain the fastest growing and most dynamic region in the world. China and India will grow by 6–7% on average over the next ten years. This may not seem much compared to the 10% that China used to average in recent decades. But what matters for the rest of Asia is the incremental demand from China in absolute terms. •  China is the second largest economy in the world. It is two and a half times larger today than it was 10 years ago. •  China growing at 7% today adds close to USD 300 billion of GDP every year compared to the USD 180 billion of GDP that a smaller China growing by 10% added 10 years ago. The ASEAN-4 – Indonesia, Malaysia, Thailand and the Philippines – are projected to grow by at least 4% per annum on average. It could be as high as 6% if ASEAN becomes more integrated and these countries successfully implement structural reforms to raise productivity and competitiveness. The Asian Development Bank projects that by 2030, the sum of the GDP of China, India and ASEAN in purchasing power parity terms could even exceed that of the US and Europe combined. For banks, it is not just the size and growth of the Asian economies that matter. It is the composition of that growth and demand.

But they necessarily remain our best judgements and that, of course, leaves us vulnerable to assertions that we do not give sufficient weight to this or that factor. For what it is worth, at the time of our last forecast in November, our central projection – on the assumption of 6% interest rates – was for output growth of around 2½% over the next couple of years, with RPIX inflation remaining modestly below target this year but rising to 2½% in 2002. There was, of course, a good deal of uncertainty around that central projection, as there always is, for the reasons that I’ve tried to explain. But on the basis of that forecast the short answer to the question: can our steady economic progress be maintained over the next couple of years is a cautious “yes”. Since that forecast was completed things have gone in different directions. The prospect for external demand has somewhat weakened and so too has the oil price. There are mixed messages relating to  2  BIS Review 1/2001  tightness in the labour market, but earnings growth has so far remained reasonably well contained - as it must continue to do. On the domestic demand side, private consumption growth has remained stronger than we had supposed, while the growth in private investment has been weaker; meanwhile it is not clear that underlying public sector demand has – at least yet – picked up as rapidly as planned. The exchange rate has fallen, and so, too, have market interest rates.
And the other thing to note is this: so far, not a single draft decision made by the Supervisory Board has been challenged by the Governing Council. But I admit that the decision-making process is complex. This, however, does not limit our ability to take decisions. In 2017 alone, we took a total of 2,308 decisions. On average, that amounts to more than six decisions a day, weekends included. So if something needs doing, it gets done. Ladies and gentlemen, the banking union is the place to be. There is a lot to be gained from going there. And if those who come bring along a stable and resilient banking sector as well as a tradition of strong banking supervision, the gains will be mutual. But let’s be honest. As any economist will tell you, there’s no such thing as a free lunch. Surely all this must come at a price? Well, in my view, the price of being a part of the banking union is low compared with the benefits it offers. Is it a free lunch? If you are part of the banking union, you need to share. You need to share control over banking supervision and resolution. That is the price to be paid. Now, I understand that it is often seen as vital to have total control over sensitive policy areas. And I understand that there is a feeling that if 4/7  BIS central bankers' speeches  you want something done well, you must do it yourself.

In the presence of temporary shocks from the supply side, these factors were translated into negative economic growth for the first quarter. According to our estimations, the following months have recorded improved aggregate demand and economic activity, yielding economic growth for 2012. This growth, however, remains relatively low and inadequate to ensure full production capacity utilisation. It has led to low inflationary pressures during 2012 and is reflected in improved external position of the Albanian economy. The banking and financial system remains sound. Banks that operate in Albania are characterised by satisfactory liquidity and capital levels, and fit for financial intermediation. Transaction and risk indicators are also improving, as perceived in the financial markets and, following fluctuation in the first half of the year, interest rates have trended down. Given the above-mentioned circumstances, the monetary policy of the Bank of Albania has been increasingly stimulating. During the past year, we have sequentially eased the monetary conditions; after five consecutive key interest rate cuts, the cost of money in the economy reached its record low. Moreover, through our monetary operations, we have supplied the banking system with the liquidity it needs for smooth operation. Finally, through the review of regulatory norms and application of a prudent supervision of the banking system, we have managed to establish a stable financial environment for the country’s long-term development. Boosted confidence of the public in the banking system was followed by rapid increase of bank deposits, thus reducing reliance on foreign short-term financing.
What there is much less historical precedence for is the failure of productivity growth to recover to its pre-crisis growth rate. A cottage industry of economists – including me – have tried to explain the so-called productivity puzzle. 3  2  Carmen Reinhart and Kenneth Rogoff (2009), “This Time is Different: Eight Centuries of Financial Folly”. Princeton University Press I set out my views in more detail in a speech in February. See: Ramsden, D. “The UK’s productivity growth challenge”, speech at Babraham Hall, Cambridge, 23 February 2018. Many other members of the MPC have also given their attention to the question – see for example: Tenreyro, S., “The fall in productivity growth: causes and implications”, speech at Queen Mary University of London, 15 January 2018; Haldane, A. G., “Productivity puzzles”, speech at the London School of Economics, 20 March 2017. 3  3  All speeches are available online at www.bankofengland.co.uk/speeches  3  Chart 3: The productivity (growth) puzzle 140  Index: 2008Q1 = 100  120 100 80 Labour productivity  60  Log-linear trend 40 20 0 1971  1976  1981  1986  1991  1996  2001  2006  2011  2016  Finally, with unemployment falling to near-record lows, and spare capacity being rapidly eroded, you might expect wage growth to have picked up at a similar pace.

The goal of my speech, which is constrained in time to ten minutes is to stimulate discussion on what could be the implications of global imbalances on emerging markets, in particular what are possible EM scenarios in case of soft and hard landing of the global plane. As you will see later the range of possible outcomes depends on what is the actual cause of the emergence of the global imbalances. Let me briefly review the most popular hypotheses. How did we get into global imbalances? The need to identify the type of the flying airplane and its technical conditions implies that one has to understand the nature of global imbalances. And here we run into the first problem, as the top ‘aviation specialists’, including ‘pilots’ themselves cannot agree on that. I have identified at least ten major views about the nature of global imbalances, namely 2 : 1.  emergence of the new Bretton Woods regime 3 .
Institutional change must go up against vested interests. This process falls squarely in the political domain. And as we are reminded by the events in Egypt and elsewhere, the political process and power struggles are rarely clean. Exercise is sweaty and messy. The fact is, institutional reform is highly contingent. They depend upon events transpiring in a particular way at critical junctures. This is shaped by the prevailing political economy context and social attitudes at the time, as well as luck. There was nothing inevitable in Deng Xiaoping’s rise to power in China in the late 1970s, which was the key pivotal moment that set China towards economic reforms that bolstered the role of market forces. The set of events that transpired were highly contingent on the outcome of a power struggle between remnants of the Cultural Revolution leadership, namely the Gang of Four, and more reform-minded members of the Communist Party. In other countries, such power struggles have come out on the other side and oppressive economic institutions remained. A confluence of factors, especially at critical junctures, largely determines the path of institutional change and development. The window of opportunity comes and goes. We must be ready to seize it as a society. Successful growth-promoting reforms are pragmatic and opportunistic. Building institutions is not like building a house – brick by brick in a linear fashion. It is more like scoring a goal in soccer.

The contrast between North and South Korea serves as a striking example of how institutional differences can lead to wildly divergent paths between two regions that were initially very similar culturally and geographically. This does not mean that a country needs to achieve comprehensive institutional development before growth can occur. “Big bang” institutional reform is typically infeasible. Instead, tackling the most binding constraints one-by-one can yield substantial growth benefits. A country does not need to attain Swiss level of institutional quality in order to be able to compete with Swiss producers in many products. For example, China’s growth miracle has occurred through selective market-oriented reforms against a backdrop of pervasive economic and political institutional weaknesses. But eventually, the growth process has to evolve to be sustained. At this point weak institutions will hamper growth. Transitioning towards a diverse and sophisticated growth model is only possible once institutional strength is achieved along sufficiently many dimensions. This reflects the existence of large complementarities. A strong legal system and enforcement of property rights, for example, won’t boost innovation much if the education system fails to produce a skilled workforce. A highly educated workforce cannot contribute meaningfully if macroeconomic stability is lacking. Good macro policy will make  2  BIS central bankers’ speeches  little difference if corruption is rampant. The individual institutional elements complement each other in such a way that the whole is greater than the sum. Without sufficiently broad institutional development, growth will stall.
Zeti Akhtar Aziz: Building financial systems for sustainable development Speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Global Ethical Finance Forum “Building Financial Systems for Sustainable Development”, Edinburgh, 1 September 2015. *  *  *  It is my distinct pleasure to speak at the Global Ethical Finance Forum here in Edinburgh. I would like to warmly thank the Scottish Government and the Middle East Global Advisors for the kind invitation for me to speak at this forum. It is a privilege to be here in the company of this distinguished and diverse gathering of professionals from the various fields that are prioritising ethical finance for sustainable development. The discussion on ethical finance that supports sustainable development is timely. In this recent decade, we have had to deal with a financial crisis of unprecedented global proportions that has stemmed in part from the prevalent ethics and culture in the financial services industry. In this period, we have also witnessed significant occurrences of misbehaviour and ethical lapses surface in the financial services profession, including the manipulation of reference rates and deliberate compliance failures. Since the global financial crisis, we have now had several years to reflect on these weaknesses and to institute the much-needed reforms that have prioritised resilience and stability. Having made important progress on this front, it is timely to direct our attention to developing more enduring solutions that will place the financial sector firmly back in the service of society.

Suhaimi Ali: Leading the change - empowering small businesses to tackle climate change Opening remarks by Mr Suhaimi Ali, Assistant Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Greening Value Chain (GVC) Programme Rollout, Kuala Lumpur, 7 March 2023. *** Assalamu'alaikum and a very good morning to distinguished guests. Let me begin by congratulating Kossan Rubber Industries Berhad and Pantas Sdn. Bhd. for the timely rollout of the Greening Value Chain programme. It is no doubt that climate change is accelerating. Dangerous weather events are becoming more frequent and extreme, and global CO2 emissions are starting to rise as economies pick up speed post-pandemic. As we gather here today, floods caused by heavy rainfall have been reported across several states in Malaysia. With the climate crisis upon us at such a pace, accelerating our actions in responding to climate risk becomes all the more urgent and necessary. Ladies and gentlemen, We are on the edge of a climate precipice, close to reaching a 1.5C tipping point, beyond which the damage to our environment would be irreversible. The increasing frequency of natural disasters also provides a grim teaser of what lies ahead if we do nothing. Recognising this urgency, more than 70 countries have set net zero Greenhouse Gas (GHG) emissions targets1, and more and more businesses are also making commitments to reach net zero GHG emissions by mid-century. Based on projections, climate inaction would cost the global economy USD 178 trillion over the next 50 years2.
For the bond market, the Bloomberg Barclays Global Aggregate Index started inclusion of RMB bonds in April, which will attract around $ billion of inflows over the 20-month inclusion process. But even upon completion, RMB bonds will only account for around 6% of the overall index, leaving a big gap to fill considering that Mainland China is the world’s 2/4  BIS central bankers' speeches  second largest bond market. In September, JPMorgan announced a 10-month phased inclusion of Chinese government bonds into its benchmark emerging-market indexes, starting in February 2020. Market estimates suggested that the inclusion could lead to around $ billion of inflows into the onshore bond market per month. Mainland China is also on the FTSE watchlist for future inclusion into its flagship World Government Bond Index, with the next review in March next year. 13. The takeaway here is that, we are just seeing the tip of an iceberg in the big wave of allocation to Chinese assets by investment managers. The pace would likely continue to pick up in the next couple of years. Hong Kong’s Unique Position and what lies ahead 14. The vast opportunities in the Mainland and the Connect schemes offer a great example to remind ourselves Hong Kong’s unique value proposition. Under the “One Country, Two Systems” principle, we maintain a regulatory regime closely aligned with international norms and practices. At the same time, our close rapport with the onshore regulators ensures that we are the best place to experiment capital liberalisation initiatives.

While that is a secondary listing, it certainly underlines the unique position of Hong Kong as an international financial centre that connects the fast growing Mainland market to global investors. 4. I know some of you may have doubts that the Chinese economy is actually slowing down in face of trade dispute and deleveraging. That is true if we compare to the days when Mainland GDP was growing at double-digit every year. But let’s remember, a real growth of 6% is still a very respectable pace compared to economies around the world. And with Mainland China’s sheer size, a 6% GDP growth means adding some $ trillion nominal value to the world’s GDP in a single year. This is more than the total size of the Indonesian economy, or close to that of Australia. 5. With such economic expansion and its deepening capital markets, China continues to be a compelling investment theme for global investors. As an investment manager ourselves, we are among the first offshore players in the Mainland’s capital markets. Surely, for the past eight or nine years since we invested in the Mainland, there had been some very challenging times, such as the RMB exchange rate reform, the stock market turmoil and fear of economic hard landing. But looking through these short-term ups and downs, two unmistakable trends are consistently borne out by actual developments. The first is the progressive opening of the markets, and the second is the growing momentum of international investors’ allocation to Chinese assets.