samchain/econo-pairs-v1 huggingface dataset:
In fact, the PRA’s resourcing model already works to focus our resources on those areas of most concern. We categorise each regulated firm according to its size and the potential harm customers would suffer should it fail. The majority of firms we regulate are assigned the lowest category, reflecting the low level of risk they pose to our objectives. Firms in higher categories receive more supervisory and specialist resources, and decisions for those firms are approved at more senior levels within the PRA’s decision – making framework. The IEO have challenged us to look at this system again and we will do so. Our Executive Director for Insurance Supervision, David Rule, will take forward discussion of all of these issues with the Prudential Regulation Committee. We will then revise our Approach to Insurance Supervision document to explain any changes we decide to make. In doing this we will of course need fully to factor in our third objective, to facilitate effective competition – 12  which was also recently reviewed by the IEO . Although this is a secondary objective, it is given a high priority in the PRA and is also quite rightly a topic in which the Treasury Select Committee takes a strong interest. Our competition work spans banking and insurance, but there has been much more public debate about the former.

This gives the central banks a strong role. Figure 7 Voting rights of the General Board  4  BIS central bankers’ speeches  Obviously, this requires efficient preparations for meetings. A Steering Committee with 14 members has therefore been established with the purpose of guiding the work to be presented to the General Board. The majority of the Steering Committee members represent the EU institutions and in addition there are four elected members from the national central banks. Two advisory committees have also been set up – the Advisory Technical Committee, chaired by Stefan Ingves of the Riksbank and the Advisory Scientific Committee chaired by Professor Martin Hellwig of the Max Planck Institute. The Advisory Technical Committee (ATC) mirrors the composition of the General Board with 62 members. The Advisory Scientific Committee (ASC) is smaller, consisting of only 15 academics and the chair of the ATC. I have been a member of the ESRB and the ATC at its first meetings Box 1 Steering Committee Members  ESRB Chair (ECB President) and first Vice-Chair  ECB Vice-President  Governors of 4 Central Banks  European Commission representative  Chairpersons of the three ESAs  President of the EFC  ATC Chair  ASC Chair The ESRB General Board held its inaugural meeting in January and has since met three times. It will meet again in December. The meetings were prepared by the Secretariat, the Steering Committee and the Advisory Technical Committee.
Potential growth differs from trend growth in that it can be affected by temporary shocks to productivity and constraints to factor use that may alter our productive capacity over the short term, but not in the 3 / 14  BIS central bankers' speeches  long. That is why our trend GDP growth estimates are a little higher than our potential growth estimates. Our latest evaluations place trend growth at 3.2%, three tenths of a point less than year ago estimates. Meanwhile, we forecast potential growth for 2016 and 2017 between 2.5% and 3%, compared with the 3% to 3.5% range estimated last year for the same period. Moreover, incoming figures suggest that potential growth will take longer to converge with trend growth. Anyway, our assessment of the current output gap is not very different from what we foresaw a year ago. This, because although since then we have revised downward our 2016 GDP growth figure by something more than one percentage point, at the same time we lowered our estimate for potential growth and 2015 GDP growth was revised up (figure 10). In recent months, financial conditions from the standpoint of borrowing costs have remained favorable. The fees charged in commercial, consumer and mortgage loans are near record lows. At the same time, growth in the stock of consumer and commercial loans has recovered from a year ago. The opposite is true of mortgage loans, which have decelerated from earlier this year. This low credit cost coincides with also low long-term interest rates.

However, continued relative stability of the exchange rate of the kwacha against major currencies is heavily dependent on longer term initiatives for sustained improvement in the supply of foreign exchange. Among these strategies is a sustained increase in export earnings through the stimulation and maintenance of a strong export sector. Ladies and Gentlemen, let me now turn to the other part of the topic, namely, the process of foreign payments. The Bank of Zambia has issued Directives that put limits on cash transactions in foreign exchange with authorised dealers. For instance, bureaux de change cannot transact in excess of US dollars 1,000 or equivalent foreign currency per transaction per day with any one individual. This arises from their primary purpose of being money changers. The corresponding limit for commercial banks is US dollars 5,000 or equivalent foreign currency per transaction per day for account holders and US dollars 1,000 or equivalent foreign currency for non-account holders. It is important to stress that these limits for commercial banks pertain to cash transactions only. Account holders and nonaccount holders alike wishing to transact above these limits can do so by choosing other modes of payments, such as, direct transfers, drafts, etc. Any remittance in excess of US dollars 5,000 has to be channelled through commercial banks and the person remitting the funds is required to support the transaction with appropriate documentation for statistical purposes, as well as guarding against money laundering and financing of terrorism.
This time, the banks, instead of asking for financial statements, obtained alternative data from various data providers through CDI. For instance, from integrated online shopping platforms, banks learnt the amount of chilled chicken Chu Kee supplied to different supermarkets, and their value. 11. With the data, the banks understood Chu Kee’s latest operating conditions better and made credit decisions speedily. Needless to say, before the data was used and shared, prior consent from Chu Kee was obtained. In the end, Mr Chu secured a substantial loan at a competitive interest rate, and was very pleased with the hassle-free experience. 12. Now, what if I tell you that the above is based on a true story?2 Yes, during the technical exploration stage, CDI has already, in real life, helped SMEs in Hong Kong take more control of their own digital footprint, and use their own data to improve their access to financial services. Importers of chilled food and sneakers, and manufacturers of phone accessories have already enjoyed the benefits of CDI firsthand. As more and more banks and data providers join CDI, we expect that an increasing number of SMEs will benefit from the platform. 13. For CDI to reach its full potential and successfully connect the digital islands, your active participation is crucial. CDI is definitely a team sport, and we all have a role to play as members of Team Hong Kong. 14. The HKMA, as a regulator, will facilitate a conducive environment, and we are doing that by building the infrastructure and offering guidance.

This is an essential step towards their possible end later; a step that is justified by our confidence in the gradual convergence of inflation towards our target of 2% over the medium term: we consider the economic recovery in Europe to be “increasingly robust and broad-based". In parallel, we said that we will continue to ensure “ample” monetary support, rather than “very substantial” support as mentioned in our previous statements – thanks to the whole range of our instruments, including the sizeable stock of assets that we will continue to hold in line with our policy of reinvestment, and our forward guidance on interest rates. In this new paragraph, the Governing Council stresses an essential point that I have often referred to over these past few weeks: our non-standard monetary policy is not a solo – it is not simply about net monthly purchases, and we shouldn’t focus too much on them –; it is a group of instruments that we can play, by following a predictable sequence, as part of our gradual normalisation strategy. It is therefore important that insurers continue to adapt their business models to the low interest rate environment. In particular, I welcome the gradual moderation of interest rates paid out on life insurance contracts, which should be pursued in order to maintain, in the long run, insurers’ solvency and their ability to meet all their commitments vis-à-vis policyholders.
In the light of higher price and cost inflation in Norway than in other countries, it has been appropriate to maintain higher interest rates in Norway than in most comparable countries. Norges Bank increased the sight deposit rate - which is our key rate - by a total of 1½ percentage points last year. So far this year, the key rate has remained  1  2  The relationship between wage growth and price inflation was also discussed in the Annual Address in February this year. BIS Review 72/2001  unchanged. As a result, the difference between short-term rates in Norway and other countries has increased. The economic outlook The Bank last analysed the outlook for the Norwegian economy in the June 2001 Inflation Report. Price inflation is projected to fall to 2½ per cent by next year already. The risk picture is mixed. The Norwegian economy is still characterised by high capacity utilisation. The labour market is tight. There is a risk that domestic pressures may gradually translate into a stronger price impetus than we have projected. The consumer price index has risen by 2.7 per cent since July 2000. The consumer price index excluding the direct effects of changes in excise duties and energy prices (CPIXE) has risen by 2.6 per cent since July last year, as calculated by Norges Bank. Statistics Norway publishes a consumer price index excluding electricity prices and a consumer price index excluding energy prices. They have a broader definition of energy prices than we use in our calculations.

Nothing could stem the tide of changes in technology and in tastes for new lighter - foreign beers, and attempts by government through higher excise duties to reduce the consumption of beer. A willingness to adapt and embrace, rather than resist, change is the key to greater prosperity. That road may at times be hard going - as I know many of you will have experienced in your own businesses but it leads ultimately to a more prosperous destination. To follow the right road we need signposts. In a market economy those signposts are movements in prices. If a particular product becomes more abundant or less in demand, its price will fall relative to the prices of other products. That relative price change is the signal which encourages consumers to buy more or producers to supply less. Over recent years, three new signposts have appeared. They mark a process that has transformed demand and supply conditions across the globe: the integration of China, India and other emerging market economies into the world trading system. The first signpost shows that prices of labour-intensive manufactured goods have fallen. China, India and the former Soviet Union between them have massively increased the supply of labour available to industry around the world. As labour-intensive goods have become more abundant, they have also become cheaper. The signpost points us in a familiar direction: the need to change what we produce.
In case that sounds odd given that Bank Rate has been at 0.5% for over two years, I should underline that, even in normal circumstances, monetary policy works through the expected path of our policy rate. The markets now expect us to keep Bank Rate low for longer. Two-year risk free money market rates are over 100bp lower than in the late spring. That has helped to offset the rise in credit spreads, and so means lower borrowing costs in the real world. I place weight on that, as my MPC colleagues know. Above that, we have decided to add £ to our programme of Quantitative Easing (QE). The degree of monetary stimulus will slowly increase as the agreed QE is executed. That money does not, as is sometimes suggested, get stuck with the banks. The whole point of the Bank’s operating framework for QE has been to avoid that. All central bank money is ultimately held by banks: that is what a banking system is. But by buying bonds from insurance companies, pension funds and others, we put the money into their hands. It is money that, by construction, provides a meagre return – negative in real terms – and so money that they will want to get rid of by purchasing other higher-yielding assets. Policy still works through asset prices, increasing wealth and reducing the cost of capital relative to where they would be otherwise.

However, attention should still be paid to the downward pressure on prices stemming from weak demand, although the pressure has weakened given some recovery in private demand. In the financial market, the overnight call rate has generally stayed near zero, and financial institutions have been confident about the availability of overnight funds. The amount outstanding of funds in the call money market increased slightly in late March, and decreased thereafter. Interest rates on term instruments rose slightly toward end-March, the end of the fiscal year, but have weakened somewhat since the beginning of April. The Japan premium remains negligible. Yields on long-term government bonds rose marginally in mid-March and stayed above 1.8%, but declined somewhat from late March and are recently back in the range of 1.7-1.8%. The yield spread between private bonds (bank debentures and corporate bonds) and government bonds continues narrowing, primarily that between private bonds with relatively low credit ratings and government bonds. Stock prices weakened almost to 19,000 yen in mid-March, but then rebounded and are currently moving between 20,000 and 21,000 yen. In the foreign exchange market, the yen strengthened against the US dollar toward the end of March. However, it weakened at the beginning of April and has been traded at around 105 yen since then. With regard to corporate finance, private banks have basically retained their cautious lending attitude. However, constraint that had been caused by severe fund-raising conditions and insufficient capital base has eased considerably.
It is notable that countries, such as Korea, which had very significant amounts of reserves prior to the crisis and a flexible exchange rate regime, nevertheless felt the need to enter into currency swaps with the Federal Reserve. During the crisis, foreign exchange reserves were used as a tool for internal – as well as external – financial stability. National central banks, especially in Latin America, acted as dollar lenders of last resort to their domestic banks. This function will develop in the future and is bound to impact the demand for reserves. Financial openness and integration means that domestic banks will engage increasingly in foreign currency operations. In turn, the expansion of international balance sheets will increase the potential demand for liquidity support in the event of shocks. This trend should be accepted as a normal consequence of open capital markets and international banking, together with the predominance of a very limited number of currencies in international finance. One general lesson can be drawn from that experience. In the current environment, there is an inescapable trade‐off between financial openness, on the one hand, and the need for protection against external financial volatility, on the other. An essential question for the future is whether we can improve this trade‐off and avoid the costs and distortions associated with growing amounts of foreign exchange reserves and/or further restrictions on international capital mobility. International financial stability: what should be done? Looking at the next decade, a number of different developments in the international financial system are possible.

Lars Heikensten: Introduction on monetary policy Speech by Mr Lars Heikensten, Governor of the Sveriges Riksbank, to the Riksdag Committee on Finance, Stockholm, 15 March 2005. *  *  *  Allow me as usual to begin by thanking you for your invitation. I think it goes without saying that these hearings are a highly valuable feature of the open discussion of monetary policy that we are all keen to safeguard. It is also my hope that the hearings can help spread knowledge about monetary policy issues to a wider audience, especially since they are now broadcast live on television. As is customary at the first hearing of the year I intend to begin by looking back on developments last year. As we all know, inflation turned out sharply lower than the Riksbank’s target in 2004. When that happens it is natural that a debate on monetary policy should arise in the public domain. It is hardly an exaggeration to say that the discussions in the past year have been unusually lively. I commented on the debate in detail when I was here in October, but there may be reason to touch upon it again today. Subsequently I intend to present our current assessment of the inflation outlook and explain the interest rate decision we made yesterday, after which I will round off with some general reflections on Swedish monetary policy and the conditions under which it operates.
Even though the direct effect of that decline will drop out of the annual comparison later this year and in early 2016, there’s a risk that, by depressing wage growth, sub-target inflation could persist for longer than we expect. BIS central bankers’ speeches  11  Chart 15 Real interest rates are low  More fundamentally, as I sought to explain in a recent speech, the “neutral” interest rate consistent with stable growth and inflation seems to have fallen significantly over the years, both before and since the financial crisis. That’s why, even without deflationary expectations, central banks came up against the zero lower bound for interest rates. And it’s that zero bound that ultimately makes deflations costly. Source: BOE, Barclays Capital and own calculations. My own view, however, is that the likelihood of a broad and protracted deflation, afflicting wages as well as prices, is pretty low. The evidence suggests that asset purchases positively affect nominal growth – they may not by-pass the lower bound on interest rates but they certainly soften it. My guess is that, with the financial system improving, and signs that the worst fears about the global economy may be subsiding, the neutral real interest rate is more likely to rise than fall over the next couple of years. Over that period, headline inflation will get a sizeable kick upwards, once the falls in food and energy prices drop out of the annual comparison.

This case also highlights the link that must exist between deposit insurance and the LOLR function. Part of the rationale is to prevent and stop runs. But at the end of the day, that only works if bank liabilities are flowing to a central bank that has the mandate, willingness, and capacity to recycle them against collateral and expand its balance sheet as needed. This means that, in the absence of arrangements for currency swaps, it must take place mostly in the same currency in order to work. So the bottom line is that a sovereign default was avoided in spite of an almost unprecedented financial collapse and the worst economic recession since the interwar years. A key to that result was the attempt to ring-fence the sovereign from the collapse of these three cross-border private banks. However, the avoidance of default during such a severe crisis does require the willingness to use the means available to avoid that outcome and the ability to endure the temporary hardship that might come with it. Even if the Icelandic authorities tried to avoid the socialisation of private sector losses in the case of the collapse of the three-cross border banks, the direct fiscal costs of the financial crisis were enormous. In this case, it is difficult to distinguish between the cost of the banking crisis and the recession that would nevertheless have occurred in Iceland in 2009, as a result of the unavoidable macroeconomic adjustment following the serious overheating of the economy in 2005–2007.
12  BIS Review 103/2009  Figure 20: GDP Growth by Periods  Figure 21: GDP  (Percent)  (Seasonally adjusted, at 1998 Prices, billion TL)  15 10  27  9.4 6.8  6.2  8.4  7.3  6.9  5.3  25  4.7  5  2.8 1.1  1.2 23  0 -5  21  -5.7  -6.2  -10 19  -13.8  1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1  2009-1  2008-4  2008-3  2008-2  2008-1  2008  2007  2006  2005  2004  2003  2002  2001  2000  -15  Source: TURKSTAT  2004  2005  2006  2007  2008 2009  Source: TURKSTAT, CBRT. An analysis of national income developments in terms of production in the first quarter of 2009 reveals that value added has decelerated in all sectors on an annual basis. Parallel to the sharp contraction in industrial activity, value added in the services sector became the component contributing most-negatively- to growth (Figure 22). On the other hand, making the said comparison in terms of expenditures, besides the sharp contraction in private sector demand, the negative contribution of stock change is remarkable. In this period, the contribution of net exports to growth went up due to the sharp deceleration in imports.

10  BIS Review 103/2009  Figure 16: Risk Premium Indicators Change in 5-year CDS rates since Aug 2008 (1 Aug 2008 =1) Turkey Brazil 5.5 South Africa Hungary 4.5 South Korea 3.5  900 800  EMBI+ Türkiye EMBI+ Turkey EMBI+ EMBI+  700 600 500 400  2.5  300  1.5  200 0609  0109  0808  0308  1007  0609  0409  0209  1208  1008  0808  0507  100  0.5  Source: Bloomberg, CBRT. In terms of changes in currency values, the Turkish lira did not significantly differ from other emerging market currencies. However, the relative fall in the volatility of the Turkish lira, which had historically high volatility and extreme sensitivity to the global risk appetite, has become more evident in 2009, when countries’ own experiences began to unfold following the worst period of the crisis (Figure 17). Figure 17: Exchange Rate Developments 1000  0.025  1.7  500  0.02  400  0.015  1.6  0609  0409  0209  1208  1008  0808  0608  0408  0  0208  100 1207  1.4 1007  0.005  0807  0.01  200 0607  300  1.5  0609  600  0309  0.03  1.8  1208  0.035  700  0908  800  0608  EMBI+Türkiye (sağ eksen)  Kur Oynaklığı* Brezilya Çek Cum.