samchain/econo-pairs-v1 huggingface dataset:
13 For example, the International Monetary Fund (2015) and Svensson (2017) argue that the costs are greater than the benefits, while Filardo and Rungcharoenkitkul (2016) and Gourio, Kashyap and Sim (2016), for example, draw the opposite conclusion. 8 [20]  Conclusion (iii): It may take a long time with a highly expansionary policy to bring inflation up – but it is possible As I have already mentioned, the first part of this lesson provides an important reason for not losing sight of inflation and inflation expectations. If this is allowed to happen, the way back may be difficult and arduous. In Sweden’s case, CPIF inflation was systematically below target for about six years, 2011–2016, occasionally by a considerable margin. To halt and then reverse the fall in inflation, we cut the repo rate to levels it had never previously approached and, in addition, the Riksbank purchased large amounts of government securities. Significant communication interventions were also required, for example when it came to describing which development of the krona the Riksbank deemed to be compatible with rising inflation. Unlike what had possibly been the case earlier, there can, from a communication point of view, hardly have been any doubt of the Riksbank's determination to reach the target. This policy has thus contributed towards inflation rising and currently being in line with the target.

Willem F Duisenberg: Another step in the direction of a united Europe Address by Dr Willem F Duisenberg, President of the European Central Bank, on the occasion of an audience by Dr Carlo Azeglio Ciampi, President of the Italian Republic, in the context of the meeting of the Governing Council of the European Central Bank in Rome, Rome, 2 April 2003. *  *  *  On behalf of the European Central Bank (ECB) and all members of the Governing Council, I should like to thank His Excellency - Dottore Carlo Azeglio Ciampi - for his kindness and hospitality to receive us today, on the eve of the Governing Council meeting in Rome, despite the geopolitical tensions we are currently facing. Moreover, I should like to thank Governor Dottore Antonio Fazio and the Banca d’Italia for organising this meeting of the Governing Council outside Frankfurt am Main. The Governing Council has decided to meet, in principle, two times a year outside the ECB premises in Frankfurt, in order to emphasise the federal character of the Eurosystem, the collective consisting of the ECB and the national central banks of the Member States that have adopted the euro.
You can see this clearly in chart 8. Both inflation and the output gap show a strong correlation with the development of the exchange rate. Appreciation of the Swiss franc equates to a tightening of monetary conditions. It leads via lower import prices to lower inflation. At the same time, the appreciation of the Swiss franc has a negative impact on utilisation of overall production capacity and thus also on general price developments. 9  The Swiss Federal Statistical Office and the Swiss Academies of Arts and Sciences (2016), Switzerland and the Commodities Trade, Swiss Academies Factsheets, Vol. 11, No. 1. Page 11/13  It is not only the export-oriented companies trading in goods on the global markets that are affected by exchange rate fluctuations. Geographically, the Swiss economy lies at the centre of the European Economic Area. Even in the domestic market, Swiss companies are in direct competition with foreign companies and cannot set their prices as high as they would like above those of their competitors in neighbouring border regions. An appreciating franc erodes the competitiveness of these companies, too. In an exceptionally open economy like Switzerland that is highly integrated internationally, exchange rate fluctuations have a major impact on price stability and economic activity. Since 2009, we have repeatedly been confronted with situations in which the appreciation of the Swiss franc has led to an undesirable tightening of monetary conditions so that production capacity has not been fully utilised and inflation has temporarily dipped into negative territory.

Page 5/13  Chart 4 shows the development of these surpluses and deficits as a percentage of global GDP over the past 20 years. Positive values represent a current account surplus; negative values a current account deficit. I would like to highlight trends in a few selected economies. Looking first at the countries which have a current account deficit, we see that the US is among them. It is represented by the blue section of the bar. The pink section denotes all the other current account deficits in the world. In 2016, this group comprised 106 countries. Let’s turn now to the countries that have a current account surplus. These are China, shown in red, Germany in orange, and Japan in green. Switzerland is depicted with a very small, dark blue bar. All other current account surpluses are aggregated in the light blue bar. This bar comprised 42 countries in 2016. The chart illustrates three facts. First, due to the small size of our country, the Swiss surplus is relatively insignificant in the global picture of current account balances. Switzerland’s contribution to global current account balances is small and did not play a role in the growth of global current account balances before the financial crisis. Second, the size and evolution of global current account balances is defined by four major economies. China, Germany, Japan and the US today make up almost half of global current account balances. The remaining 150 or so countries together make up the other half.
  Fourth, Asian banks will take time to build expertise in areas such as structured trade finance that the Eurozone banks have specialised in. 20. Deleveraging is a process not to be avoided but to be managed. The world as a whole has lived beyond its means in the years preceding the global financial crisis. Many advanced economies grew rapidly on the back of easy fiscal policies, low interest rates, and excessive credit expansion. The emerging economies benefitted from this growth through exporting to the advanced economies. 21. The world must now work off these past excesses. Debt in the advanced economies must come down to more sustainable levels before these economies can return to a  BIS central bankers’ speeches  3  balanced growth trajectory. This must mean lower consumption and higher savings for some time. Emerging economies, especially in Asia, must increase domestic demand to help offset some of the impact of the slowdown in the G3 economies. But they will not be unaffected. They too will see slower growth. Monetary expansion 22. A second driving force in the global economy is the widespread phenomenon of easy money. Since the beginning of the financial crisis in 2008, central banks in the US, UK, and the Eurozone have embarked on unprecedented monetary expansion. With fiscal policy constrained by sovereign debt concerns, the burden of supporting growth and ensuring financial stability has fallen disproportionately on monetary policy.

But as long as monetary conditions in the advanced economies remain easy, the risk of disruptive capital flows and surges in inflation, especially in asset prices, remains real. 27. The challenge facing Asian policymakers is this: how to adjust policy settings to cope with slower economic growth while inflation has not been entirely tamed? While there has been some normalisation in policy rates over the past two years, real interest rates remain generally low to negative in the region. Credit growth is strong and bears watching. Persistent low real interest rates can distort savings-investment decisions and lead to a misallocation of resources. Risks may build up in specific sectors, like real estate for instance. 28. Asian economies have mostly coped with these pressures by complementing standard macroeconomic responses – such as raising interest rates and allowing some currency appreciation – with a variety of so-called macroprudential tools, such as tightening credit standards and lowering loan-to-value ratios for property purchases. These unconventional measures have been fairly effective to-date in easing asset price inflation. But like unconventional monetary policy in the advanced economies, these measures are also not without risk. 4  BIS central bankers’ speeches  Shift in investment portfolios to Asia 29. What do these driving forces mean for the asset management industry? One clear trend will be the shift of investment portfolios to Asia, as the driving forces accentuate the underlying shift in the world’s centre of economic gravity towards Asia. 30.
Only based on the principle of a high degree of sustainable convergence an EU member state can adopt the euro. 3. Each and every one of the countries participating in the European monetary union has followed one and the same route towards the adoption of the single currency, based on the principle of equal treatment. As regards procedures, the road to the euro consists of two stages. As I said, all 15 participating countries have gone through the same stages, and have been required to fulfil the same criteria: Stage one is the accession to the EU. EU-membership requires the fulfilment of the Copenhagen criteria. •  Alongside a number of political criteria that require stable institutions guaranteeing democracy, the rule of law, human rights and the protection on minorities, as laid down in Art. 6 of the EU Treaty,  •  candidate countries need to have a functioning market economy, able to withstand competitive pressures within the EU. •  Moreover, the candidate country has to fully implement the EU’s rule-book, the so-called acquis communautaire. The fact that a country must first join the EU before it becomes a member of the euro area is not a coincidence. It is a deliberate approach, which underlines the fact that the EU is more than a mere economic undertaking. After all, a currency is a key attribute of sovereignty. Sharing a common currency implies sharing a common political destiny. Stage two is euro area accession.

•  Another milestone was the creation of the Economic and Monetary Union, at the beginning with 11, then 12 and 13 and 15 members since January this year. o  The Treaty establishing the European Community assigns the European System of Central Banks the primary objective of maintaining price stability. The ECB has managed to gain and maintain trust of the public and of market participants by delivering price stability. Although the single monetary policy faced a number of significant challenges, the ECB managed to stabilise the HICP inflation on average at 2,1 % from 19992007. This compares with an inflation rate of 3 % in the nine years preceding the EMU. o  The inflation expectations in the euro area have been anchored in line with the ECB’s definition of price stability: below but close to 2%. This underlines the high reputation the ECB’s monetary policy has gained over time. II  Given the topic of my speech, the principles, procedures and criteria that govern the adoption of the euro, I would like to underline the key principles for joining the euro area at the very outset: 1. A country must first be a member of the European Union before it can adopt the euro. The EU Treaty lays down the criteria that European States have to respect before they can apply for EU membership. BIS Review 17/2008  1  2. The roadmap and the conditions for the adoption of the euro are laid down in the EC Treaty.
Though the authority in the Dodd-Frank Act is limited in some ways—it applies only to certain systemically important activities and the designation process requires coordination across regulatory agencies and related administrative processes—the scheme is flexible in other ways because it contemplates an activities-based approach to regulation and oversight in addition to a prudential approach for certain institutions.33 To be crystal clear, I am not saying that any digital currencies are currently ripe for consideration under the FSOC designation process; just that a similarly flexible though not necessarily identical process involving coordination and collaboration across multiple regulators may be warranted. The Path Forward In applying lessons learned from the past to the modern era, one path forward might be to consider the following questions in determining whether a broader regulatory scheme is sensible: 1. First, who should be authorized to act as an issuer of a digital currency or as an intermediary that can hold or transfer a digital currency on behalf of a holder? And, is existing regulation adequate to cover each? If not, should we consider expanding the regulatory perimeter to address each from a prudential regulatory standpoint? 2. 3. 4. 5. Doing so would provide us with an avenue for addressing risks each may pose to holders or the system more broadly. Second, are there certain features of digital currencies that are either desirable or undesirable from a regulatory or policy standpoint? If so, are there restrictions or incentives we should adopt to avoid a recurrence of a landscape that resembles the wildcat era?

There are also a significant number of other Taiwanese banks which have expressed the intention to establish representative offices here. We are processing these applications in an orderly fashion on a “first-come first-served” basis. It has long been our policy not to allow in too many banks from the same region or country too quickly. As in the case of the Japanese regional banks and the Korean banks we therefore operate a queuing system. I know that this can sometimes be frustrating to those who are at the back of the queue. But I would like to made it clear that these is no reluctance on our part to admit banks from Taiwan, as the existing presence here clearly demonstrates. I am sure that Dr. Jeffrey Koo will also testify to this. 6. Hong Kong is currently going through tougher times as a financial centre. Some foreign banks have cut back their lending here and a few banks have actually left. This has reflected problems back home rather than discontent with Hong Kong. However, it is true that Hong Kong must reduce the cost of doing business in order to remain competitive, and that is why the current fall in property prices and rents, while painful, is also necessary. I am confident that Hong Kong will emerge from the current crisis with a better-balanced economy and with even stronger fundamentals. Above all, it can continue to rely on its main strategic advantage as a financial centre - namely, its proximity to the Mainland of China.
It is therefore essential to find a solution to the NPL problem, but we must recognise that it will take time and no single instrument is likely to be a “magic bullet”. Rather, it will require a comprehensive strategy involving a panoply of instruments. The ECB is already working on this and has issued clear guidance to the banks it directly supervises. But supervisory action is not enough on its own. The private sector and national and European authorities also have roles to play. Several significant impediments affect the prices of NPLs, to varying degrees across euro area countries. The market for distressed debt can be characterised as a “market for lemons”. This is a situation where investors demand a premium to protect themselves from the uncertainty that better-informed banks will try to sell them assets whose credit quality is worse than it may seem on the surface. This results in limited market activity, as the prices that investors are prepared to pay for NPLs are much lower than the prices banks would be prepared to sell them for. Structural inefficiencies in debt and collateral enforcement also contribute to the lack of market turnover. The legal procedures for collecting a simple claim take too long and cost too much in many euro area countries. On the demand side, investors are also deterred by high uncertainty around recoveries and their timing, and by barriers to entry such as licensing requirements. These symptoms of market failure, aggravated by legal constraints, call for a public policy response.

These topics, as I understand, will be discussed this afternoon under the two scheduled working group sessions. To broaden the geographical reach of the large pool of useful reference documents on IRB-related issues produced for its meetings or contributed by the member jurisdictions, the AIGV has developed an electronic library on eBIS to store these documents for access by the supervisory community. The hosting of this event is well timed, as some jurisdictions have already entered into the implementation phase of the Basel II IRB framework and other jurisdictions, including many from Asia, are in the pipeline for the introduction of the framework for adoption by their banks. The event is therefore a good opportunity for representatives of jurisdictions which have yet to adopt Basel II to hear from jurisdictions already implementing the framework about the emerging issues, and to facilitate future communications on this topic among participants. As Chairman of the EMEAP Working Group on Banking Supervision, the HKMA certainly welcomes the opportunity to host this outreach event, and would like to thank the AIGV members who have stayed behind after the regular meeting to provide support. A major innovation of Basel II is that it allows banks to calculate their regulatory capital requirements using the output of their internal rating systems, subject to supervisory approval. Under the IRB Approach, banks employ internal rating systems to produce estimates of one or more risk components, which are then used as the key inputs to the calculation of regulatory capital requirements for credit risk.
None of these periods will be remembered as being particularly successful economically. Historically, economic growth has been strong in periods of relatively low inflation and weak in periods of especially high inflation. Inflation poisons the economy. The interest rate affects inflation through a number of channels. An increase in the interest rate will normally contribute to reducing inflation by curbing demand for goods and services and by strengthening the krone exchange rate against other currencies. An interest rate reduction has the opposite effect. The strength of these effects will depend on the situation prevailing at the time of the interest rate change and how the change is perceived. The effects may also vary over time. Monetary policy affects the economy with a lag. Analyses carried out by Norges Bank indicate that a substantial share of the effects on inflation occurs within two years. Two years is thus a reasonable time horizon for achieving the inflation target of 2½ per cent. If evidence suggests that inflation will be higher than 2½ per cent with unchanged interest rates, the interest rate will be increased. If it appears that inflation will be lower than 2½ per cent with unchanged interest rates, the interest rate will be reduced. Inflation in Norway is determined by both domestic and international inflationary impulses. Domestic inflationary impulses are influenced by the state of the Norwegian economy. International inflationary impulses are generated via prices for imported consumer and intermediate goods.

This level will still provide solid profitability for many investment projects in the petroleum sector and continued large surpluses on the current account and in government finances. The krone exchange rate, measured against our most important trading partners, has appreciated by about 7 per cent since the spring of 2000. However, the krone exchange rate is about 2.5 per cent weaker than in 1990 and at the same level as in the mid-1990s. Traditional merchandise exports remained high in the first half of 2001 but exhibited a weaker trend in the second half of the year. Foreign trade figures for the fourth quarter of 2001 indicate that the decline in export volumes may have come to a halt, although export prices are still falling. Consumption indicators suggest strong growth in private consumption. Credit growth has slowed somewhat due to reduced borrowing by enterprises. Household borrowing, on the other hand, has increased further. Developments in debt may also influence financial stability. Although borrowing by enterprises appears to be declining, their debt burden remains high. This reduces enterprises’ ability to cope with downturns. The household debt burden is increasing, but the level is low. These developments are due in particular to the housing market, with high turnover and high price rises. Experience shows that private sector debt tends to increase at a particularly fast pace during upturns. Higher asset prices may be a driving force.
Mr. McDonough’s address on the occasion of the 10th International Conference of Banking Supervisors Keynote address by Mr. William J. McDonough, President of the Federal Reserve Bank of New York and Chairman of the Basle Committee on Banking Supervision, on the occasion of the 10th International Conference of Banking Supervisors held in Sydney on 22/10/98. I am very honored to be here as Chairman of the Basle Committee on Banking Supervision and as the Chairman of this year’s International Conference of Banking Supervisors. These are unusually difficult and challenging times for bank supervisors around the globe. Turbulence in the financial markets has touched the banking system in virtually every country. To varying degrees and in many different contexts, bank supervisors are dealing with adjustments to their banking systems to assure their strength and vitality. At times like these, bank supervisors have a special role in maintaining financial stability. That role is to facilitate a resolution of banking problems so that the depository institutions will continue to provide the vital lifeline of credit to businesses and consumers. Past experience in many countries suggests that even severe problems can be overcome with decisive action by banks to identify problems quickly, recognize losses, strengthen the capital base, and execute a sound, forward-looking business strategy. Today, the supervisory community has the same challenge. We must identify the lessons to be learned from the current financial turmoil and address them.

Together with IOSCO and the IAIS, we should work to strengthen internal financial firm management, supervision and market discipline, no matter what the nature of the financial firm or market. As a final point, let me stress that while we continue to elaborate the roadmap of the Core Principles, we must also press on in understanding the frontiers of financial developments. This makes for a difficult and ambitious agenda, but we must be and we are up to the challenge. The most important example of this broad effort is the work the Committee has begun on the future of capital. We know the value the Basle Accord has had in strengthening capital standards around the world. At the same time, we have recognized that advances in risk management and financial practices are beginning to erode the relevance of the Accord for the most technically sophisticated banks. That means that we must identify ways to ensure that the Accord will provide meaningful guidance for the maintenance of strong capital levels at those banks, while still providing the fundamental protection to the financial system that is needed in all countries. To that end, the Committee has formed a Steering Group on the Future of Capital, chaired by Claes Norgren of the Swedish Financial Supervisory Authority. It is my hope that the review conducted by the Steering Group will bring together new thinking on a minimum capital rule, a comprehensive look at the supervisory evaluation of capital adequacy, which I described earlier, and enhancements to market discipline.