samchain/econo-pairs-v1 huggingface dataset:
MAS also set up a $ billion US Dollar Facility that is available to all banks, on the back of the swap arrangement with the US Federal Reserve. This Facility has helped to stabilise US Dollar funding conditions in Singapore, and enabled US Dollar lending to businesses in Singapore and in the region. About $ billion has been provided through this Facility. FINANCIAL STABILITY  The COVID-19 shock has also increased the risks to global financial stability. The world entered the current crisis with one strong card and one weak card. The strong card is the banking sector. Globally, banks are generally in good shape, with healthy capital and liquidity buffers. The weak card is the corporate sector. In many parts of the world, corporate debt levels were already high pre-COVID, and will increase further through the course of this crisis. With tight cash flows, over-leveraged entities could face financial distress, leading in turn to ratings downgrades and corporate defaults. Mounting corporate defaults will strain banks’ profitability and capital positions. The strong card could become progressively weaker. If this happens, banks will be less able to sustain credit to the real economy. Worse still, if funding conditions also tighten and confidence is shaken, some banks could run into trouble, possibly triggering a financial crisis. MAS is determined that the financial system in Singapore remains robust and resilient. Our banks have built up strong capital and liquidity buffers, and are well-placed to weather these risks even as they continue to extend credit.

To support banks’ capacity to lend, MAS has implemented transitional measures till endSeptember 2021: Allowing banks to recognise 100% of regulatory loss allowance reserves as Tier 2 capital; and Reducing from 50% to 25% the amount of stable funding that banks must maintain on loans to individuals and businesses maturing in less than six months. MAS also provided guidance to financial institutions on estimating their loan loss allowances in the context of COVID-19: That in assessing COVID-19’s impact on future economic conditions, financial institutions should consider the government’s support measures in bolstering economic resilience; and That financial institutions need not maintain higher loan loss allowances solely because 8 / 15  BIS central bankers' speeches  COVID-19 relief measures were applied to certain loans. MAS provided room for insurance companies to rebalance their investment portfolios in the face of uncertainties in financial markets: By extending to end-2021 the transitional measure in the calculation of their financial resources under RBC 2. OPERATIONAL RESILIENCE OF FINANCIAL INSTITUTIONS  The financial sector has been operationally resilient, functioning with minimal disruption in the face of COVID-19. The financial industry has maintained a high level of customer service throughout the Circuit Breaker period, as well as Phases One and Two of the re-opening. They have also continued to seamlessly conduct their wholesale and international businesses. The industry’s operational resilience reflects sound business continuity planning and agile adjustments to work processes.
There are diminishing returns in terms of the benefits of ever higher capital requirements. Setting the bar at too high a level would increase intermediation costs too much and drive activities offshore or into areas that are not as closely regulated. At some point, higher requirements would not make the financial system safer, just the regulated sector much smaller. On this last point, some argue that the new standards are too severe. They argue that, in the short run, the higher standards could lead to a significant constraint in credit that could hurt the nascent economic expansion. And, they argue, in the long run, that the higher capital standards will inevitably drive up lending costs and that this will hurt economic performance. Although I believe the new standards do impose some real costs on the financial system in order to achieve real benefits, I believe that concerns over the costs are exaggerated. Turning first to the issue of the transition to the new regime, we cannot precisely predict the size of the adjustment costs as they will depend importantly on the strategies bank managers employ to meet the new requirements, and how bank investors respond to these actions. Nonetheless, I believe the transition is likely to be quite manageable for three reasons. 4  BIS Review 131/2010  First, many of the large U.S. banks already have large amounts of tangible common equity. In part, this represents the regulatory response during the crisis.

It is also my hope that by establishing a robust global regime, we can mitigate the incentives for national regulators and supervisors to impose local rules that make it hard for globally active institutions to manage their operations on a global basis, thereby undermining the global integration of markets that has supported economic globalization. Over the next 12 to 18 months, regulators will be particularly busy in implementing these reform efforts. Broad legal statutes now have to be turned into specific rules and regulations governing business practices, conduct and operations. Doing this well – in particular, in a way that is sufficiently informed, deep and broad – will be very important. Basel III and the  1  Governor Daniel K. Tarullo, Comments on “Regulating the Shadow Banking System”. Brookings Panel on Economic Activity, September 17, 2010. 8  BIS Review 131/2010  Dodd-Frank Act are important markers on this road, but it will always be a journey to a neverreached destination of perfection. Thank you for your kind attention. I would be happy to take a few questions. BIS Review 131/2010  9
The high interest rates offered by these markets kept the efficiency of monetary policy in steering the interest rate pending. In addition, other issues, such as the high concentration of deposits and loans in three state-owned banks, their operational losses as a result of the increase in non-performing loans’ portfolio, the undeveloped and incoherent regulatory framework in supervision had become an impediment to the expansion of reforms in the banking sector. Following this period, the banking system consolidation process began to progress. This period is characterized by the reduction in the share of state-owned banks, their gradual privatization and the considerable increase in the number of private banks from 4 operating in 1997 to 17 banks in 2006. In this context, the central bank has been extremely prudent in selecting and licensing the private banks, where only three of them licensed the recent years are of entirely Albanian capital. Despite the increase in the number of domestic commercial banks, the expansion of the banking activity until 2003 was a prudent one, being in line with the country’s economic development. During 1998-2003, the banking system’s total assets grew by an average of 13 per cent a year, consistent with the nominal GDP growth during this period. Nonetheless, there has been a swift growth in banking assets by 67 per cent in the last three years, which is 2-3 times higher than the cumulative growth of nominal GDP.

And that, according to Eurosystem calculations, the output gap will return to close to zero by the end of the year ( 0.6%), even though France’s situation is less favourable due to its growth lag (output gap of around 1.4% according to our calculations). The non-standard monetary policy that we have been conducting since 2014 is contributing to this acceleration of growth in the euro area, by supporting domestic demand and by fostering very favourable financing conditions. In concrete terms, this acceleration results in more jobs – over 6 million jobs created in the euro area since the start of 2013 – and in a pick-up in investment. Corporate investment in particular, decisive for supply capacities, is clearly recovering: up 4.7% in 2015, 6% in 2016, and is expected to be up 4% in 2017 and 2018). [slide] This improvement in investment is underpinned notably by ongoing growth in lending to the private sector, at 2.5% year-on-year in August 2017 for firms and at 2.7% for households, with interest rates moreover remaining very low. This growth in lending is over twice as high in France, which incidentally leads us to be very vigilant at the High Council for Financial Stability. We are also observing favourable developments in inflation, which is gradually moving back towards our target of 2% over the medium term [slide]. After peaking at the start of 2017, the inflation rate stood at 1.5% year-on-year in August.
However, these general responses are tinted by the intense uncertainty—observed both in Chile and around the world—regarding the shock’s persistence, its actual consequences and the magnitude of its indirect or second round effects. (6)  Optimal response to foreign exchange shocks  The above considerations can apply to the optimal response of monetary policy to parity shocks. In general, in its conduct of monetary policy, the Central Bank does not react to exchange rate movements beyond their effects on inflation and output. This because of the favorable response of the Chilean economy to increased exchange rate volatility that has been present since the late nineties. First, the pass-through coefficient from exchange rate depreciation to inflation has dropped substantially in Chile, to very low figures in the range of 20% to 30%, in the policy horizon. Second, the currency mismatch has been reduced in non-financial firms which, in turn, are being insured against residual parity risks generated by short-term exchange rate volatility in an increasingly deep market. Finally, the Central Bank reserves the option to intervene directly in the foreign exchange market with sterilized operations and in publicly announced conditions, if it evaluates that a temporary exchange rate volatility or misalignment so warrants.

Beneath the surface of these encouraging macroeconomic data, there is - and has been for some time a serious imbalance, with some parts of the economy doing very well (including many of the services sectors and some manufacturing activity) while other parts of the economy (including much of agriculture, many manufacturing businesses and even other services sectors such as inward tourism) face the toughest business conditions that many of them can remember. To take just manufacturing, total output has risen by only 2% over the past two years, and it has actually fallen by 0.9% if you exclude the so-called “high tech” sectors (ie computers, office and telecommunications equipment and electronic components). Total employment in manufacturing has fallen over that period by some 230,000, of which 200,000 were outside the “high tech” sectors. For what it’s worth there is a similar imbalance in the US, where total manufacturing has increased by 10½% over the past two years, but by only about 1½% similarly excluding the hi-tech sectors; total employment in US manufacturing has fallen by some 435,000, but by nearly 600,000, outside the “high tech” sectors. There is no single explanation for these developments. They result partly from continuing and unavoidable long-term structural adjustment of capacity to market demand; it results also partly from the effect of increasing global economic integration, inducing the relocation of manufacturing capacity in response to shifts in comparative productive advantage.
We would do well to remember, however, that people’s perceptions of the future are often shaped not so much by words as by actions. So, after a series of purposeful decisions by the Government, the Riksdag (Sweden’s parliament) and the Riksbank, economic policy’s general commitment to macroeconomic stability began to inspire confidence. Economic policy’s credibility gave the Riksbank greater freedom to act The growing confidence accordingly meant in turn that, without jeopardising the objective of price stability, the Riksbank was able to lower the repo rate relatively markedly, from almost 9% to just over 4%. Interest rates for longer maturities also fell. This led, as we have all seen in recent years, not just to higher GDP growth but also to a more uniform development of demand in different sectors. When the cyclical upswing began towards the end of 1993, most of the growth came from the export sector. However, lower levels of interest rates benefited Swedish households and firms by easing the heavily restrictive effect of the high level previously. This contributed to an increase in domestic demand as well and broadened the economic upswing. That can be said to have instigated the considerable reduction of unemployment we have seen in recent years. Neither the Asian crisis in 1997 nor the turbulence in international financial markets in the autumn of 1998 had much of an impact, thanks not least to a monetary policy realignment in many countries. The Swedish repo rate was also cut, to a low of 2.90%.

Both the pattern of international fund flows and the underdeveloped state of the regional bond market require this. Fostering regional bond market development involves co-operation on a number of fronts among economies with very differing economic, political and cultural backgrounds. It is often said that the diversity of this region - in comparison with, say, Europe - is a considerable obstacle to the kind of financial, economic and monetary co-operation that might be desirable. Nevertheless, it is heartening that, in this area at least, considerable progress has been made over the past few years, particularly among central banks. This co-operation has taken two forms: market development initiatives, which help promote the growth of a regional bond market, and infrastructural initiatives, which facilitate that growth. Let me, in the remainder of this address, briefly outline some of these initiatives. A number of collaborative initiatives have been undertaken by central banks in the region to foster the development of both local and regional bond markets. These can be grouped into three main clusters, each falling under the auspices of a major regional multilateral organisation. The first of these is the APEC Initiative on the Development of Securitisation and Credit Guarantee Markets, which is being spearheaded by three APEC member economies (Hong Kong, Thailand and Korea) and sponsored by the World Bank. The aim of this initiative is to address structural impediments to the development of bond markets and to provide an effective and immediate solution to the credit gap problem.
Prices adjust automatically to supply and demand, and the general view was that  Newton’s theory shown to be insufficient, during the solar eclipse of 1919. Scientists were then able to observe that the light from distant stars was bent by the Sun’s gravity, just as Einstein had predicted. Many scientists once believed that the Earth looks the way it does, with mountains and valleys, because the Earth was originally a red-hot mass that gradually shrivelled as it cooled. We know what an orange looks like after a long drying process or what clay looks like after being exposed to the air for a time. What was a smooth surface becomes wrinkled. It was 100 years ago this year that the German meteorologist Alfred Wegener proposed an alternative theory of continental drift. He used heuristic arguments based on studies of coastlines. Brazil has a coastline that is an apparent perfect fit with the Gulf of Guinea on the west coast of Africa. Even so, the theory was not accepted until it was given a proper theoretical foundation and empirical grounding. The breakthrough came 50 years ago, when the American geologist Harry Hess proposed his theory of sea-floor spreading, and by the end of the 1960s the theory of plate tectonics became established science. The Centre for Advanced Study, which is located here in the Academy, recently hosted a research group that is at the very international forefront of this field.

We value highly human and civil rights ranging from gender equality, data protection, to the condemnation of torture, including the rejection of capital punishment. The protection of these values and rights relies on the vigilance of the legal professionals here in this room and elsewhere. This is even more important vis-à-vis a reality of extreme and obsessive forms of nationalism. The EU has also increased personal choices. The ability to travel, work and live across borders has been enhanced. The European Health Insurance Card permits European citizens to obtain healthcare wherever they are. 1.5 million people, perhaps including some of you here today,  BIS central bankers’ speeches  1  have completed part of their studies in another member state as part of the Erasmus programme. More than 15 million EU citizens have moved to other EU countries to work or to enjoy their retirement. This wider range of options increases people’s wellbeing. These reasons, and the other positive aspects of membership, have been drowned out in debate by concerns over migration and the large wave of refugees from troubles in the Middle East and elsewhere, the impact of the crisis, disaffection with high levels of unemployment – especially youth unemployment, and a perceived lack of accountability and legitimacy of the EU institutions. I fully recognise that Europe in its current state is not perfect. The crisis has shown that Economic and Monetary Union is incomplete, and further work is required, particularly in the areas of banking and credit markets.
Faced with the possibility that they would have to finance these vehicles themselves, banks with spare cash have hoarded it and have become reluctant to lend to other banks beyond very short maturities. That has been evident in the spreads between interbank lending rates and central bank interest rates in the UK and equally in the euro area and United States. The bottom line is that banks that had financed themselves by borrowing from their peers, or by securitising and selling their loan assets, found that their funding dried up. In the United Kingdom, Northern Rock was particularly exposed. It was able to borrow only at shorter and shorter maturities. The present financial crisis is of a most unusual nature in that it comes against a background of five years of strong growth of the world economy and a decade and more of remarkable economic stability at home. Moreover, most banking and financial crises in the past – from the failure of Overend and Gurney in 1866, to the collapse of BCCI in more recent times – were associated with bad loans and significant losses on assets. The remarkable fact about this crisis has been the relatively small size of the bad loans compared with the total assets of banks. The crisis has arisen instead from the way banks have managed their liabilities. What did the Bank of England – as the central bank – do for the banking system?

Richard W Fisher: A report on the Texas economy and a hawk(s)eye view on recent Fed pronouncements – what does it all mean? Remarks by Mr Richard W Fisher, President and Chief Executive Officer of the Federal Reserve Bank of Dallas, before the Headliners Club, Austin, Texas, 2 February 2012. *  *  *  Thank you, Patti [Ohlendorf]. I am flattered that such a great group of Austinites has turned out tonight. I am especially pleased that Alejandro and Rosa Laura Junco are here. Alejandro is CEO of the print media company Grupo Reforma. He has earned a sterling reputation for journalistic independence in a part of the world where independence is a rare and sometimes dangerous thing. Columbia University, the University of Missouri and Michigan State University have honored him for his journalistic accomplishments, and the University of Texas at Austin has named him a Distinguished Alumnus. Alejandro’s company and its flagship paper in Mexico City take their name from La Reforma, a period of liberalizing reforms that transformed Mexico into a nation state in the mid-19th century, beginning with the overthrow of the man Texans know best and like least – Santa Anna – and ending with the ascension to power of a good general gone bad, Porfirio Diaz. As a child growing up in Mexico City, I was taught about La Reforma in school.
It should be kept in mind that the persistence of certain global imbalances and protectionist pressures and the uncertainties over oil and other commodity prices represent risk factors for growth, which date from before the outbreak of the current bout of turbulence. Turning to prices, the behaviour of production seems to have been accompanied by a slight upturn in inflation to around 2% in the medium term, since the smaller contribution of indirect taxes (which has been especially marked in 2007) should be offset by the larger contribution of unit labour costs, in what is a buoyant labour market. Against this background, a possible increase in wage pressure associated with the aforementioned taking-up of slack in the labour market, or a widening of the margins in those sectors more sheltered from international competition, pose risk factors for price stability in the euro area. The current financial market turbulence has naturally heightened the downside risk to growth, and this has in some way mitigated inflationary risks, which nevertheless continue to rise. Above all, however, the turbulence has widened the range of uncertainty associated with the central scenario for the European economy that I have just described. In these conditions, the first ECB Governing Council meeting this month unanimously decided, as you know, to hold interest rates unchanged and gather more information on this episode of turbulence and study it in more detail before taking any new decisions.

While it is clear we have come a long way since 2008, we can’t just settle for making a promise that no bank will be ‘too big to fail’: as Resolution Authority the Bank must be able to deliver on that commitment. Fundamental to that delivery, the UK now has the requisite statutory tools, and powers to underpin a credible bank resolution framework. These are set out transparently in the Banking Act 2009 and there are  6  Also known as the Purple Book, and subsequently updated in 2017. As set out in the December 2019 Financial Stability Report. 8 The December 2020 Financial Stability Report sets out the FPC’s latest assessment. 7  4  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  4  safeguards in place so that these powers can only be used in the right circumstances. These features allow market participants to have confidence in the integrity and predictability of our decision-making, which is supported by the UK’s strong and effective institutions. These powers also form an important complement to supervisory and prudential tools; that these are embedded within the UK legal framework ensures they function as a credible and independent backstop for banks at risk of failure. Flexibility and proportionality in implementation  While a credible and transparent policy regime is necessary it requires flexibility and proportionality in development and implementation to ensure overall effectiveness of the regime.