samchain/econo-pairs-v1 huggingface dataset:
In this programme it committed to reducing the budget deficit to 3% of GDP by 2013, by means of sharp cuts in public spending, although the programme was based on a relatively benign macroeconomic scenario, thereby  BIS Review 86/2010  5  raising the question of the need for additional efforts should budget deviations arise, an eventuality expressed by the ECOFIN Council in its recommendation on the programme. The scale of the fiscal crisis in Greece has led the Spanish government to strengthen and accelerate its fiscal consolidation programme in order to prevent market deterioration and the attendant serious consequences for the economy and the stability of the euro area. The package of measures approved on 20 May brings forward a significant portion of the effort to be made to reduce the deficit in 2011, when it should stand at 6% of GDP, and acts directly on its structural component, which is projected to fall by somewhat more than half with respect to the estimated 2009 levels. The government’s unprecedented austerity drive reflects the exceptional nature of the situation and the resolve to set public finances on the right track and thereby dispel the doubts which were fomenting contagion and instability. The unquestionable costs this will entail for society will be compensated by the enhanced protection from instability and by a sounder position on which to base recovery. It is thus absolutely essential to meet the new targets set, even if the macroeconomic scenario ultimately proves to be less dynamic than envisaged by the government.

Svein Gjedrem: The conduct of monetary policy Introductory statement by Mr Svein Gjedrem, Governor of Norges Bank (Central Bank of Norway), at the hearing before the Standing Committee on Finance and Economic Affairs of the Storting (Norwegian parliament), Oslo, 28 September 2004. The text below may differ slightly from the actual presentation. The statement is based, among other things, on the assessments in Norges Bank’s Annual Report for 2003 and Inflation Report 2/2004. The  Charts in pdf-format can be found on the Norges Bank’s website. *  *  *  I would like to take this opportunity to thank the Storting for again inviting Norges Bank to appear before this Committee to report and answer questions on monetary policy in connection with the Storting’s deliberations on the Government’s credit report. Inflation-targeting countries Price stability, in the sense of low and stable inflation, is the objective of monetary policy in a number of countries. Historical experience from Norway and other countries has shown that high inflation has resulted in unstable output and employment. In addition, a fall in the price level will often accompany a period of decline. The first inflation target was introduced in New Zealand in 1990. Canada followed in 1991, the UK in 1992, and Sweden and Australia in 1993. In Norway, the government issued a regulation introducing an inflation target in 2001. Monetary policy in euro area countries and Switzerland is also aimed at price stability, even though this is not referred to as inflation targeting in these countries.
So our inflation targeting in the euro area is nothing new or specific; and our present monetary policy is not some uncontrolled Latin flight of fancy. In practice, the euro area experienced a remarkable period of price stability up until the crisis. But as of 2013, inflation dropped well below the 2% mark. Our mandate meant we had to react in order to bring inflation back to healthier levels for our economies. And we are clearly progressing towards our objectives. Our monetary policy works; the measures we have put in place since 2014 have already been successful. First, [slide 2] we have warded off the mortal danger of deflation, and inflation is gradually recovering in the euro area. Headline inflation peaked at 2% last month, up from –0.2% in April 2016. The sharp – and partly temporary – uptick at the beginning of this year is mainly due to the rebound in energy and food prices, as underlying inflation remains below 1% (and 1.2% in 1/9  BIS central bankers' speeches  Germany). However underlying inflation is expected to rise gradually to 1.8% in 2019. We are reasonably confident that both headline and underlying inflation will converge, close to our target in 2019; and this convergence, which is not often stressed, is a key element in our forecasts, as it is crucial to the mid-term sustainability​ of the inflation path.

The average return on equity varies significantly across countries – and France ranks among those with the most solid in the euro area – but on average it has stagnated at around 5%. This situation raises three questions, about three possible factors: low rates, non-performing loans and the digital transformation. The first factor, and the one most frequently mentioned, although sometimes to excess, is the low interest rate environment. Insurers and pension funds with a high level of fixed rate guarantees may suffer. As for banks, their net margins have been squeezed by the low interest rates and the flattening of the yield curve. However this question needs to be examined from all angles [slide 5]. Monetary policy has also had offsetting effects: lending volumes have picked up again; banks have booked significant capital gains; the cost of risk has fallen as borrower solvency has improved; the cost of funding including market and ECB financing has become cheaper. All in all, the overall impact of our non-standard monetary policy measures on bank profitability is expected to be modest for the period 2014–17. Furthermore, nominal interest rates are slightly on the rise since the turning point in August 2016, and nominal rates are the ones – not real ones – which matter for bank profitability, as well as the slope of the yield curve. The second factor putting pressure on profitability is the level of non-performing loans [slide 6].
The G-7 intends to continue to review the topic of HLIs, which will be of assistance as we urge countries to implement sound practices in this area. I would not want to characterize or opine upon the efforts of any one jurisdiction; many countries’ efforts, like ours, are underway only recently and need time to develop and take hold. There probably will be differences in the degree to which supervisors in different countries address the questions I have discussed today – if only because the intensity of HLI activities varies among countries. But on the whole, I believe that supervisors in major countries will follow up on the recommendations issued by the Basle Committee. BIS Review 36/1999  4  Direct Versus Indirect Methods of Addressing HLI Safety and Soundness Many governments have considered or will consider the advantages and disadvantages of imposing direct regulation on the HLI industry. The Basle Committee report discussed that issue and concluded that concentrating on the behavior of banks and other counterparties doing business with HLIs would yield effective and more immediate results. A common element of many HLIs is that they are structured in ways that minimize their exposure to supervisory oversight and costs. Thus, many have chosen to organize themselves legally in jurisdictions that offer modest supervision and low taxes. Am I pleased that so many HLIs are organized legally in what many would characterize as tax havens? No.

I will focus my remarks on the work done at the international level by the Basle Committee on Banking Supervision, which issued a report and sound practice recommendations on January 28 with regard to banks’ dealings with HLIs. Before I get too far into the details, let me share with you my overall approach to the issues we will be discussing this morning. My views have been shaped not only by my positions as Chairman of the Basle Committee on Banking Supervision and President of the Federal Reserve Bank of New York, but also by my 22 years of experience as a commercial banker. Both my private and public sector experience have led me to conclude that the LTCM episode, and the proper supervisory response to it, are fundamentally about two things: leverage and good judgment. Leverage is an important part of our financial system. Most of the time leverage plays a positive role, resulting in greater market liquidity, greater credit availability, and a more efficient allocation of resources in our economy. But problems can arise when financial institutions go too far in extending credit to their customers and counterparties. That’s where good judgment comes in. In my view, the most important decisions a banker can make are whom to do business with and how far that business relationship should be pursued. Those judgments are not easy: one of our fundamental aims as supervisors should be to see that banks are using the right tools to make those decisions.
Sometimes we hear it said that the ECB should have a less accommodative monetary policy because it has created false incentives for governments. This reasoning is not in line with the spirit and the letter of the European Treaties. The ECB is not – and must not be – an instrument of fiscal policy. But we say to the countries in question that they should make the most of the current situation and of the gains stemming from the drop in interest rates to reduce their indebtedness rather than to spend more. Finally, do you think that the ECB will exit this state of emergency before you come to the end of your term? As far as the financial state of emergency is concerned, yes I do. The challenge now is to achieve long-term growth. So, the answer is no? Let’s just say that, increasingly, the challenges that Europe is facing are unrelated to monetary policy. BIS central bankers’ speeches  3  Let’s move on to the topic of Greece. Social discontent is on the rise, the negotiations between the Tsipras government and the “quartet” are already stalling over some points of the new financial rescue plan. Isn’t there a risk that the coming months will be turbulent? No one said it would be easy. The third programme, which was approved by the Greek Parliament, is extremely ambitious. It covers areas that previous governments had not dared to tackle, which call into question existing benefits, for example the battle against vested interests in some sectors.

This naturally impacted the financial health of the corporate sector, and business failure rates rose to levels comparable to those of the early 1990s. These economic trends, combined with the discovery of egregious shortcomings in corporate governance, fuelled misgivings about stockmarkets. And amid a global bear market, equity volatility soared. Consequently, as in 2001, capital market business in the broad sense of the term - securities, mergers and acquisitions, and the fees and commissions charged for these activities - were adversely affected. 1.2  Despite an unfavourable climate in 2002, French credit institutions reported net income on a par with 2001. French credit institutions reported net income of 17.7 billion euro in 2002, the same as in 2001. This works out to a return on equity of 9.4 per cent for the industry as a whole. As in previous years, these results were largely attributable to retail banking business in France. Consumer credit and home loans continued to grow, along with specialised financial services. In addition, falling interest rates had a positive effect on interbank business - which in France has always been significant - and drove down the net expense on these transactions. By contrast, capital market activities and asset management were hit by financial market turbulence, giving rise to substantial provisions in some cases. Furthermore, for the second year running, fees and commissions contracted as a percentage of net banking income, falling to 26 per cent compared with nearly 30 per cent in 2000.
People know that we never have hesitated to do whatever was necessary to restore the proper functioning of the monetary market and the effectiveness of monetary policy transmission. We have been sometimes criticized but the results are there. WSJ: Do you think the euro zone’s bailout fund – the European Financial Stability Facility – should be expanded? Noyer: The European response has been an ambitious response to the present crisis and the fund has been a remarkable success. We would clearly favor the fund to be enhanced both quantitatively and qualitatively. I think increasing it quantitatively is probably the intention of governments. The fund’s firepower is limited by a number of technical constraints to get a triple-A rating. How to move closer to the original intention in terms of firepower is clearly up to the reflection of governments. It is appropriate to think about [enlarging the size of the fund] even if there is no immediate need. As far as the qualitative aspect of the fund is concerned, it seems to me that having the capacity for instance to intervene in secondary markets could probably be an interesting feature in some cases, if only to facilitate access to the market. This of course raises for governments the question of conditionality of the support … but probably they can find answers to that. Another possibility would be that of precautionary programs [such as credit lines], like what the IMF is doing.

It is a bold assertion, but not necessarily an unreasonable one, reflecting the dollar value of transactions processed across the Fedwire Funds, Fedwire Securities, and National Settlement Services; the interconnectedness and dependencies between these services and other systemically important infrastructures; our role as central securities depository and as fiscal agent for the issuance, maintenance, and redemption of all Fedwire-eligible securities; and as the platform across which the Federal Reserve ultimately settles its monetary policy operations. Any one of these elements would likely qualify the wholesale services as “systemic”; in the aggregate they represent a staggering portfolio on which the execution of both our nation’s fiscal and monetary policies ultimately depends. In recognition that a wholesale service outage risks a significant shock to the United States, and in light of the escalating threat landscape in which collectively we operate, last year before this audience I shared a series of reflections endeavoring to advance a new paradigm for resiliency and security for financial market infrastructures. This year I’d like to provide an update on our progress on this front, and then to elaborate on the portfolio of wholesale service initiatives that we are endeavoring to advance to add value for customers and end users. As always, my remarks reflect my own views and do not necessarily represent those of the Federal Reserve Bank of New York or the Federal Reserve System.
COVID-19 is a unique opportunity to break this vicious circle. The crisis will require a massive reallocation of capital and labour across sectors and economies. It has the potential to unleash unprecedented forces of Schumpeterian creative destruction that can help accelerate the adoption and diffusion of green and sustainable technologies across large parts of the economy. Policymakers need to allow, facilitate and support this process. But the scope for policy mistakes has increased measurably as the crisis has forced governments to expand their role in economic activity. There can be no doubt that a forceful fiscal response to the crisis was both necessary and adequate. Nevertheless, there is a risk that some of the measures – if kept in place for too long – may delay the necessary structural adjustments. Even before the pandemic, some carbon-intensive sectors had been facing strong secular headwinds in the wake of changing consumer preferences. The second reason is that the crisis will cause a significant increase in the public and private debt burden. Issuance of public and corporate bonds is reaching record levels. In a low-interest-rate environment, the increase in leverage carries a lower cost than in the past. But the best way to avoid the risk of growing debt becoming a long-lasting burden for society is to lift potential growth today and shift the economy on a higher and more sustainable growth path. There are few other areas with a comparable growth potential as green technologies.

Although this trend is impressive, much more needs to be done in order for the sector to meaningfully contribute to the growth of the country’s economy. Provision of finance to the SMEs can be a leading conduit for transforming our economy by opening up business opportunities as well as channelling resources more efficiently and effectively to the sectors that require it the most. BIS central bankers’ speeches  1  Distinguished Guests, To see a commercial bank bring its services to the heart of the informal sector is an encouraging sign not only to the Bank of Zambia but to the entrepreneurs of Soweto Market as it demonstrates the confidence that the Bank has entrusted in the SME sector. It is also our hope that the perception of banks being intimidating to the informal sector will be a thing of the past thus alleviating the challenges faced by SMEs in accessing finance. Furthermore, by partnering with the local entrepreneurs in Soweto Market which is the biggest market in Zambia, Stanbic Bank is encouraging a culture of banking for a myriad of Micro small and medium entrepreneurs. Because of the key role that SME sector plays in the economy, the Bank of Zambia will ensure that financial institutions are fully responsive to the unique characteristics of this sector. The Bank of Zambia attaches great importance to initiatives that seek to enhance the provision of financial services to the underserved sectors of the economy. The opening of this Branch today is a demonstration of this important objective.
The second half of 2018 saw some positive events: the signing by the United States, Mexico and Canada of the pact replacing the North American Free Trade Agreement; the opening of negotiations for a US/EU agreement; and the temporary truce called between the United States and China to settle their differences. More recently, however, in May and June this year, there was a fresh escalation in trade tensions between China and the United States. US tariffs on $ billion worth of Chinese product imports were raised from 10% to 25%, and the response by the Chinese authorities was to raise tariffs on US imports. At the G20 summit in Osaka in late June, the two countries reached an agreement to reinitiate trade negotiations. Yet despite this, and the fact that the United States subsequently announced the suspension of certain restrictions on US companies selling technological equipment to specific Chinese firms, August saw a new episode in the escalation of tensions in the trade war between the two countries. Moreover, the United States, which has accused the Chinese authorities of manipulating the exchange rate, has postponed until November its decision on potential tariff increases on cars and their components, a measure that would mainly harm the EU and Japan. 1  See Box 1.1, “The global impact of a hypothetical economic slowdown in China”, in the Annual Report 2018, Banco de España, and Box 2, “Economic policy room for manoeuvre in China”, in the “Quarterly report on the Spanish economy”, Economic Bulletin, 2/2019, Banco de España.

SPEECH  Higher policy rate will curb inflation Introductory statement by Governor Ida Wolden Bache at press conference following announcement of the policy rate and publication of Monetary Policy Report 3/22 Chart 1 Policy rate raised Norges Bank’s Monetary Policy and Financial Stability Committee decided to raise the policy rate from 1.75% to 2.25% at its meeting on 21 September. The policy rate will most likely be raised further in November. Norges Bank’s task is to keep inflation low and stable. The operational target is inflation of close to 2 percent over time. We are also mandated to help keep employment as high as possible and to promote economic stability over time. We are raising the policy rate with the aim of bringing down inflation. Price stability is important for the economy to function well. It reduces uncertainty and facilitates planning. Those with low incomes and small margins are normally the hardest hit when inflation suddenly surges. The main contribution monetary policy can make to promoting high employment over time is to ensure low and stable inflation. As long as there is confidence that inflation will remain low and stable, the costs of minor deviations from the target of 2 percent are fairly insubstantial. But if households and firms expect inflation to be elevated and high inflation is incorporated into price and wage setting, inflation may take root, and bringing it down again could prove difficult. Chart 2: Inflation is high Consumer price inflation is now rising rapidly both globally and in Norway.
After this I shall discuss in greater depth the individual items on the balance sheet, to see how they have been affected over the past year. I shall conclude by looking ahead and discussing the question of when and how the extraordinary measures can be phased out. The Riksbank’s balance sheet Let us begin by looking at how the Riksbank’s balance sheet looks in rough outline under normal circumstances and at how it has changed during the crisis. The Riksbank’s balance sheet, like those of other companies and organisations, reflects the activities we conduct. The liabilities side shows how our activities are financed and the assets side show what the financing is used for (Figure 1). Figure 1 The Riksbank’s balance sheet  Assets Gold and foreign currency reserve Lending to banks Other assets  Liabilities Banknotes and coins Deposits from banks Other liabilities Own capital  Under normal circumstances the Riksbank primarily finances itself by issuing banknotes and coins and through its own capital. Banknotes and coins in circulation normally comprise the largest individual item on the liabilities side. Own capital is the next largest. In addition, the  BIS Review 160/2009  1  liabilities side in principle consists of deposits from banks and the item “Miscellaneous”. These items are usually small and less important than banknotes and coins and own capital. The Riksbank’s assets normally consist mainly of gold and the foreign currency reserve.

But it is also likely that there is less slack in the economy than implied by the deviation of productivity from its pre-crisis trend. Looking ahead, the degree to which the margin of slack is eroded will depend on the outlook for demand. If demand recovers strongly, that would close up the degree of slack in the economy. But if demand stays weak, then potential supply will gradually respond downwards, also closing the margin of slack (although that process would probably be slower than if it was faster demand growth doing the work). BIS central bankers’ speeches  7  The risks from inflation expectations are also difficult to assess, principally because we do not have good data on the true expectations of businesses and wage bargainers, only what they record in surveys. Personally, I look for signs of de-anchoring inflation expectations in two places. The first is in nominal wage growth, which as I have discussed earlier, remains subdued. The second is in financial prices, where we can extract information on inflation expectations by looking at the differences between the yields on conventional and indexlinked gilts or by looking at inflation swap markets. These data – like any other – need to be interpreted and analysed with caution. Financial markets are prone to bouts of volatility. The instruments are linked to RPI and not CPI inflation. The short maturity end of both the gilt and the swap markets are relatively illiquid, and the long-end of the markets can be moved around by structural demand (e.g.