samchain/econo-pairs-v1 huggingface dataset:
For example, in Chile, if it were determined that housing prices are distorted and lenders are not correctly internalizing this distortion, then the Superintendent of Banks and Financial Institutions (SBIF) has the authority to increase provisions and capital requirements on housing loans. Addressing the risks that arise from expanding cross border debt requires, at the very least, that existing prudential regulation ensure that funding liquidity risk is dealt with adequately by financial intermediaries. Often, however, this may simply lead to a transfer of this risk to the non-financial sector. Hence, there remains a role for a foreign currency liquidity buffer made up of international reserves. Vulnerabilities regarding currency risk that often come hand in hand with increased foreign debt, merit special attention. In the past we have seen many crises originating from the accumulation of unhedged foreign currency debt in banks and non-financial corporations. This was one of the main amplifiers of the Chilean banking crisis of the early 1980s – where firms in the domestic sector built up substantial amounts of dollar-denominated debt during a period of fixed exchange rates and capital account opening. It was also an important factor in the Mexican crisis of 1995, in the Asian crisis, and more recently in financial problems in some Eastern European countries. On the other hand, low currency mismatches allowed the central banks of many EMEs to lower interest rates aggressively as a response to falling demand during the crisis. In the past there was fear of exchange rate depreciation because of currency mismatches.

6  BIS central bankers’ speeches  Figure 3 Dollarization of liabilities of the corporate sector in Latin America: 1992-2009 (in percent, annual average across firms ) Argentina  Chile  Brazil  64  25  29  56  20  25  48  15  21  40  10  17  32  5 93 95 97 99 01 03 05 07 09  13 93  96  Colombia  99  02  05  08  93  Mexico 50  74  10  45  68  9  30  5  25 96  99  02  05  05  08  05  08  56  35  6  02  62  40  8 7  99  Peru  11  93  96  50 44 90  93  96  99  02  05  08  38 93  96  99  02  Exchange Rate Regime: Managed and Independently Fixed or Pegged Floating Source: IMF. BIS central bankers’ speeches  7
Global financial markets are improving, but they are still fairly sensitive to fiscal perspectives of certain economies and to tensions in the Euro area. Additionally, these markets show relatively little interest in South Eastern Europe countries, including Albania. Overall, world economic growth is expected to remain high for the upcoming period as well, contributing also to the triggering of inflationary pressures and drawing more attention of monetary authorities to macroeconomic balances. Domestic economic and monetary developments continued to generate an environment of contained inflationary pressures. Annual inflation for January 2011 was 3.3%, dropping by 0.1 p.p. compared to December 2010. This decline of inflation in January is totally due to the statistical effect of neutralising the increasing impact of some administered prices on inflation. On the other hand, food items and oil prices increased significantly, as a result of rising prices in world markets. These factors contributed by about 80% to the formation of the inflation figure. Increased agricultural products prices affected mostly the low-income segments of the Albanian society. As stated above, domestic inflationary pressures are characterised by short-term supply shocks, while the generated inflation by domestic demand is low, as reflected in the relatively stable situation of core inflation. This performance is conditioned by the existence of free capacities in the Albanian economy as well as contained monetary expansion and anchored inflationary expectations of consumers, businesses and agents in the financial market. The Bank of Albania deems that, in general terms, these factors will continue to be present during 2011.

Large fluctuations of the exchange rate of the leu that are decoupled from domestic economic fundamentals, as well as from the monetary policy pursued by the National Bank of Romania  4. Major deviations from the administered price adjustment programme announced by the Government, in terms of both magnitude and proposed calendar  5. Divergence of the fiscal and income policies, in terms of implementation and outcomes, from the programmed coordinates  Case in point: monetary policy under a string of VAT changes  To give you a flavour of the environment the monetary policy has had to operate in lately, we had three VAT rate cuts from 2013 to 2016, after a hike in 2010, and another cut is scheduled for 2017. Currently, the annual inflation rate stands at –3.25 percent, the most negative value in the EU. Excluding the first-round effects of the VAT cuts in mid-2015 and early 2016, headline inflation would have hovered around +1 percent. Consequently, the negative inflation we are dealing with now is not at all a condition brought about by a persistent lack of demand, as economic activity, employment and wages are actually buoyant. This is just a transitory development, induced by the aforementioned indirect tax cuts. The textbook policy choice would be to accommodate the temporary deviation from the inflation target and focus on the VAT-adjusted inflation developments – especially since the latter paint a quite different picture.
At the same time, the decisions by the ECB in December and in February to offer the banks in the euro area three-year loans against collateral have helped to stabilise the situation on the financial markets. So, although the situation in Europe is still problematic, we can see that progress is being made at approximately the rate the Riksbank has estimated. In such a scenario we can expect to see a recovery in the euro area, although a weak one, over the next few years. Poorer performance abroad leading to slowdown in Sweden The weak performance in Europe at the moment is affecting the Swedish economy in several ways. First, the demand for Swedish exports is falling. This was also the main reason why growth slowed down in the economy at the end of last year. Second, household and corporate confidence in the economy is falling and this in turn is leading to a slowdown in consumption and investment. The financial situation in Sweden is also affected by developments abroad. The fall in share prices in 2011 reduced the financial wealth of the households, which contributed to an increase in saving. It is unlikely that there will be any significant decline in saving in the period immediately ahead as the low level of growth is expected to reduce employment and increase unemployment.

In 2016 intra-regional trade contributed USD521 billion or 23.5% of total trade. IntraASEAN investments rose to a record level of USD24 billion in 2016 and accounted for 25% of total FDI flows into the region. Within the region, Indonesia and Thailand are important partners to Malaysia both in trade and direct investments where there is continuous growth propelled by inter-company linkages and cross-border investments. In 2016, Malaysia shared a bilateral trade volume of USD13.8 billion with Indonesia and USD13 billion with Thailand. However, only 5.8% and 11.4% of our trade with Indonesia and Thailand, respectively were settled in local currencies. This is an enormous business opportunity for the financial sector, which has yet to be realised. Similarly, on the investment front, Malaysia has invested USD13 billion and USD2 billion of direct investments into Indonesia and Thailand, as at second quarter of 2017. Indeed, the completion and enhancement of the Frameworks is an important step towards the use of local currencies to support cross-border settlements for trade and direct investments among the three countries. It is an opportunity to mitigate the impact of volatilities in major trading currencies on regional trade and investment activities. We can recall the Global Financial Crisis, where the tightening of global US dollar liquidity was a contributor to the 19% contraction of total trade and 11.5% contraction of total inward FDI into the region.
Aggregate demand has expanded leading, in turn, to acceleration of economic growth, increase in employment and wages, better utilisation of production capacities and improvement of the financial situation of enterprises and households. In parallel, the balance sheets of the banking sector are sound and improving. The key 1/3  BIS central bankers' speeches  parameters of liquidity and capitalisation are above our regulatory requirements, the nonperforming loans ratio is on a clearly downward trend, and the banking sector appears profitable. In addition, as a result of the consolidation process underway in the banking sector, new actors have been introduced to the market – I take this opportunity to welcome them – and premises for fostering competition and efficiency in the banking system are created. Lastly, our stress tests show that this sector is capable – overall – to withstand shocks. This process has been anchored to prudent economic policies: monetary stimulus, fiscal consolidation and prudential supervision and regulatory policies. In particular, let me point out that the Bank of Albania has earnestly worked on the following: Approximation of our regulations to European Union standards and Basel Committee requirements; Improving the supervision architecture of the financial system and strengthening safety nets; Improving the credit environment by facilitating the solution of issues related to nonperforming loans; and, Developing and expanding further the financial and payment systems market.

The improvement in access to finance, coupled with concrete initiatives to deep financial education of the population, with which it is in a complete symbiotic relationship, helps enterprises and households to capitalise their growth potential, by generating profit for themselves and gains for the economy. Lastly, modernisation and innovation should be an important and long-term priority of the banking sector. A constant evolution would provide the premises for a sector that is competitive and efficient and avant-garde with regard to technological development in Albania. Taking into account the insofar substantial impact of the banking sector on the advancement and diffusion of innovation to other sectors, this investment would be necessary and profitable to both the financial industry and the overall Albanian society. Forward looking, I remain confident that the banking sector will know to rise to these challenges 2/3  BIS central bankers' speeches  and that the conclusions of today’s conference will serve as another stepping stone in this regard. Thank You! 1 Ms. Anila Denaj, Minister of Finance and Economy  3/3  BIS central bankers' speeches
10 But even with those constraints applied we have considerable headroom after the current programme is completed, reflecting a range of considerations. And many of those considerations are within our control - while those constraints are there for good, pragmatic reasons, they are not set in stone, and there would certainly be scope to re-evaluate them based on Bank advice if the MPC judged that even more monetary policy headroom was needed (Figure 8). Figure 8: There is plenty of QE headroom remaining Stylised map of the gilt market1  (1) The area of each block represents the market value of the gilts in that sector of the market. Taking as a given that the MPC has more headroom to buy more gilts, the question then becomes whether we have the scope to impact their pricing. This is a trickier calculation– it depends not just on the quantity of headroom, but on how effective any action might be, which is highly state contingent. But again my starting point is we have plenty of scope to affect prices. While yields on longer-dated gilts are at historically low levels, that doesn‘t mean they couldn’t still go lower. As the March episode illustrates, there may also be occasions when the absence of action – the counterfactual – would mean an increase in those yields. Of course the quantity of QE purchases is not the only policy variable available to the MPC. The pace of purchases, as illustrated by our March intervention, is another.

As the MPC has made clear, we will keep the appropriateness of all tools, including negative rates, under review. It is for that reason that the Bank is taking steps to understand how negative rates might be implemented in practice. It would be wrong to claim a tool is in your toolbox if you aren’t able to use it when it’s needed. For 13  The analysis is set out in Box 1 of the Report, which is available at https://www.bankofengland.co.uk/-/media/boe/files/monetarypolicy-report/2020/august/monetary-policy-report-august-2020. 8  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  8  that reason, in my own areas of responsibility in the Bank, we are working to ensure all our systems would be able to handle negative rates if needed. The September MPC Minutes flagged that the Bank and the PRA would also begin structured engagement on operational considerations with the wider financial sector. We launched that engagement on 11 October with a letter to CEOs of all UK banks and building societies, as well as large international banks and insurers – over 180 firms in total – asking them to identify any operational challenges associated with implementation of zero or negative Bank Rate, with a deadline for responses of November 12th.14 That letter will be followed up by supervisory engagement with firms where needed to understand key themes and timeframes. And we will also be engaging with trade bodies and relevant financial market infrastructure firms, and would of course welcome responses from any other interested firm.
More conservative fiscal policy would have done what monetary policy could not accomplish; namely, to cool down the overheated economy. Ladies and Gentlemen, These lessons have been expensive ones. Thailand, as a nation, has spent the last five years dealing with the problem with some severe hardship and grave consequences. Although it is probably safe to say that the height of the problems is now behind us, we still face an enormous uphill battle. A new set of challenges seems to emerge everyday, some with very important repercussions on the Thai economy. Here, what spring to my mind are the delay in the global economic recovery and China’s WTO entry already mentioned, as well as the current global equity slump. This is just to name a few. To prepare Thailand for these future challenges, we need to get the fundamentals right on all of the four areas that I have just discussed. In brief, we need to raise productivity in the real sector, rebuild our financial infrastructure, instill the value of good governance in both the private and public sectors, and develop a comprehensive macroeconomic strategy. Needless to say, comprehensive real sector reform is at the core of the new paradigm for sustainable growth. And this requires a carefully planned national agenda. In essence, Thailand needs to  BIS Review 62/2002  3  distinguish itself quickly in the fast-evolving global competitive landscape.

M R Pridiyathorn Devakula: Thailand's emergence from the crisis - new paradigm for sustainable growth Speech by Mr M R Pridiyathorn Devakula, Governor of the Bank of Thailand, at the International Conference on "Economic Recovery and Reforms", Bangkok, 28 October 2002. *  *  *  Distinguished Guests Ladies and Gentlemen, It is my great pleasure to be here with you tonight. I would like to begin by welcoming you all once again to Bangkok and to this important international conference on Economic Recovery and Reforms. I would also like to express our appreciation to the Faculty of Economics, Thammasat University, the main organizer of the conference, in allowing the Bank of Thailand to co-host the event. Our appreciation also goes to the distinguished scholars who came from all over the world to share with us their perspectives on this important topic. To many of us here, especially those in the Asian region, the 1997 financial crisis has completely changed our lives. It was, in a way, a sharp reversal of fortune when suddenly things that were thought to be good before the crisis became no longer good enough. And terms like ‘restructuring’ and ‘reforms’ have then become something of a norm. This long and tiresome journey has now lasted for more than five years, and naturally begs a question, “when are we going to get out of this abyss?” This question is particularly pertinent to Thailand. After all, the Asian crisis started here.
But in order to actually use such budgetary policy tools flexibly, the budget has to be balanced not in the course of just one year but across the whole economic cycle - posting a surplus in the periods of fast economic growth while showing not a very large deficit, a maximum of 3% of the GDP, in the period of downturn. There has been a notion spreading among Estonians that we are extremely good... Hence the biggest threat facing us is complacency. •  Besides its significant role in the world trade, the European Union has long been a net investor in the rest of the world. But the level of investments within the European Union, at least in the old member states, remains lower than it could and should be. A well-considered investment policy is one of the key issues from the point of view of European economic development prospects. Creating an attractive investment environment and utilising the know-how accompanying the investments is an area where Estonia has (at least in the case of the financial sector) successful experience to offer to Europe. At the same time, Estonia as an EU member state should learn from the experiences of other states. •  In 2004-2006 an average of 2.7 billion kroons per year is flowing into Estonia from the European Union. According to the present financial estimates, the inflowing amount will be around 40 billion kroons in 2007-2013, an average of 5.6 billion kroons a year.

BILD: But it is precisely this policy of cheap money that is not working… Draghi: Wrong – our policy is working, but we must be patient; investor confidence has not yet been fully restored. For two years, the economy in the euro area has been growing month by month, banks are lending and unemployment is steadily falling. Meanwhile, euro area countries are now able to buy more German exports again, which, for German companies, is partly making up for the decline in trade with China. But it is a slow process because the crisis was more severe than anything we’d had since the Second World War. BILD: And when will interest rates rise again? Draghi: It’s quite simple: when the economy is growing more strongly again and inflation rises closer to our objective. Low interest rates today will lead to higher rates tomorrow. BILD: Does the ECB’s policy of cheap money not make it far too easy for euro area countries like Italy and France, for example, to shirk necessary but unpopular reforms? Draghi: No. The majority of governments are acting, albeit too slowly for my personal taste. All of them would be well advised to do more. But that is not primarily dependent on the ECB and its policies. Most countries started to implement reforms when the level of interest rates was already very low. Furthermore, reforms of judicial systems, electoral laws or labour laws, for example, don’t have much to do with interest rates.
11  Total sterling notes and coins in circulation, excluding backing assets for commercial banknote issue in Scotland and Northern Ireland, seasonally adjusted. 12 Statistics from Payments UK (now part of UK Finance) show that the value of cash payments were between £ and £ in each year from 2001-2010 but has fallen over recent years to £ in 2016. 13 From 18.2bn payments in 2014 to 15.4bn in 2016 (Payments UK). 14 ECB Use of Cash in Households in Euro Area Survey (2017) 8  All speeches are available online at www.bankofengland.co.uk/speeches  8  The Bank of England has been very clear that it will issue cash to meet demand, as it has always done. Our investment in new cash technology, safer and longer lasting polymer notes is a demonstration of that commitment. At the same time however we will continue support innovation and competition in the machinery for making payments in the economy. But we also need to ensure that the private sector that increasingly provides much of the changing technology of our money as a means of payment, does so within an appropriate framework of regulation and authorisation. Along with our sister regulator, the Financial Conduct Authority we need to ensure that those who offer payment services, new and existing players alike, in any of the links of the transaction chain, are properly authorised and can manage the risks they bear.

I am confident we have made the right choice as it has produced more security for the stability of both the banking system and the deposits of Albanian citizens. Third, in the recent negotiations with the International Monetary Fund and the World Bank, under the conditionalities of the new arrangement that will be approved today by the IMF Executive Board, we have agreed to include the write off of banks’ loss loans that are provisioned and have no hope of being collected, having no financial effect on the banking system. Amendments are formalised in a draft law that is expected to be passed by the Assembly in the near future. Fourth, the recovery of lending is considered one of the main instruments contributing to improving the level of non-performing loans. I would like to dwell a little longer on this aspect. Despite some optimistic developments in terms of the increased number of credit applications submitted for execution or restructuring, the larger banks, which have considerable potential to lend, are not using properly the measures promoting lending recovery, as opposed to the smaller banks, which appear more active. We believe the main reasons forestalling a more significant effect of these measures are as follows: First, actions taken to boost credit supply need to be complemented by other actions to boost credit demand. The latter remains unstable in the face of sluggish economic growth and weak consumption and investments.