samchain/econo-pairs-v1 huggingface dataset:
The traditional role of central banks as the lender of last resort and keeping certain markets functioning may have the side effect of increasing risk-taking in the financial sector. If banks assume that central banks will always be there for them in a crisis, risk-taking may increase, as they will nevertheless be bailed out in a crisis situation. This needs to be borne in mind when formulating the terms and conditions for the purchases. But there is also a need for regulation and supervision  22 [30]  that can increase the resilience of the financial markets in various ways. This is important to reduce risk-taking and the likelihood that central banks will need to intervene. More analysis of the impact of asset purchases is needed Central banks' balance sheets have grown and become very large since the early 2000s, see figure 5. For example, the Riksbank's balance sheet has increased from just over 5 per cent as a share of GDP before the global financial crisis to just under 30 per cent today. Central banks have bought securities, primarily government bonds, to make monetary policy more expansionary when the policy rate has been close to the lower limit, and have also bought other securities to stabilise the financial markets. There are of course strong links between these two purposes. If there are problems on the financial markets, monetary policy has less impact on other interest rates and therefore also less impact on demand and inflation.

Their development has enabled market participants to hedge risk, develop arbitrage, and, therefore, enhance the efficiency of price setting in financial markets. Of course, the other side of the coin is that derivatives are sometimes criticised as they may be regarded under some circumstances as a potential threat to financial stability. I will come back to this point later on. The elimination of currency risk within the euro area has also had far-reaching effects on the equity markets. This is crystal clear when observing volatility patterns and portfolio allocation methods. As regards volatility patterns, recent developments seem consistent with the predictions of economic theory, where stock prices should reflect expectations of future dividends, interest rates and risk premia. It follows that the introduction of the euro should be associated with a reduction in differences 7 in volatility across markets. Indeed, a recent empirical study demonstrates that those countries whose stock exchanges had a structural high or medium volatility regime, converged towards those with a low volatility regime. From the point of view of the European stock market as a whole, this shows an improvement in global efficiency. As regards investment patterns, sector-diversification strategies have been defined as an alternative to country diversification. Before EMU, it was common practice for institutional investors to make geographical diversification their first priority, and, secondly, to select securities in accordance with a sectoral diversification pattern. There is some evidence that the “home bias” has weakened since the introduction of the euro.
The Federal Reserve Bank of New York has also been deeply involved in efforts to reduce foreign exchange settlement risk -- efforts that should further serve to improve market efficiency and overall financial stability. In October 1994, the New York Fed-sponsored Foreign Exchange Committee issued a major report on “Reducing Foreign Exchange Settlement Risk.” The Bank has also been working actively in this area with other central banks through the G-10 central bank Committee on Payment and Settlement Systems, or CPSS, which I have had the pleasure to chair in recent years. Building upon the work of the New York Foreign Exchange Committee, the CPSS published a document in March of last year, often referred to as the Allsopp report, that contains a comprehensive strategy outlining how the public and private sectors can work together to reduce foreign exchange settlement risk. The strategy was endorsed by the G-10 central bank governors and calls for specific action on the part of individual banks and industry groups. A survey conducted by the CPSS last autumn indicates that individual banks are answering the G-10 governors’ call for action. Many banks have made a good start in improving their ability to measure, manage, control, and net their bilateral settlement exposures, and they plan to push these efforts even further over the next year. While this is a very encouraging beginning, we can’t ignore the fact that more work must be done by individual banks.

And, neither bankers nor traders have a monopoly on this capacity -- corporate treasurers and institutional investors can pull up most of the same screens we can. At one time, a presence in a local market and access to early newspapers could provide a trading advantage for a large market maker. Today, news from that market is available electronically worldwide with almost no lag. Information is cheaper and easier to come by than ever before. The result? A global market that reacts quickly and efficiently to new data, and participants who have more time to analyze information because they need to spend less time gathering it. One consequence of this improved transparency in information technology is that information gets reflected in asset prices more quickly and more smoothly than ever before. A closely related development that has also contributed to increased transparency in the foreign exchange market has been the rapid evolution of the price discovery process in the past several years. Electronic brokerage and electronic interbank dealing systems have evolved that have smoothed the dissemination of current pricing and improved market liquidity. Whereas truly competitive pricing was once the province of only the largest market makers, smaller interbank dealers -- and even some foreign exchange end-users -- now also have access to narrow bid-ask spreads. The result so far has been a deeper market and, again, a more level playing field for all market participants, with pricing no longer dominated by a few large players.
The first is to make the size of the arrangement larger and more meaningful with respect to possible needs of members. The second is the simplicity of the activation process, especially for the first tranche. This is important for giving assurance to participating members that liquidity will be made available in a timely manner. And the third is the objective of turning CMI into a multilateral facility at a later stage. This last feature, if realized, will provide the region with its own financial arrangement that can help expand the region’s capability in safeguarding financial stability. lt goes without saying that a move to emphasize greater resource commitment by members will entail substantial strengthening in the current regional surveillance process. This is a development that we all should welcome. Strengthening the surveillance process should in fact be a key prior condition for expanding the CMI because it will help make the CMI process credible while reducing the risk of moral hazard. CMI is currently under review. I hope some of the points I have touched upon will be further explored. But whatever the outcome of the review may be, I am confident that it will signify another important step forward for regional financial cooperation. My second thought is on the region’s bond market. Economists in the region have long made known their views that Asia is a region with surplus savings, but the financial surplus of Asia has not been effectively utilize for the benefits of the economies in Asia. This is clearly a missed opportunity.

10  Alsterlind et al. (2015) describe the signalling and portfolio balance channels in more detail. 11  12  In Sweden, the effect on rates with short maturities is probably more important than the effect on rates with long maturities. This is because most lending to household and  15 [16]  companies is done at variable interest rates. According to Statistics Sweden’s Financial Market Statistics, 73 per cent of lending to households and non-financial corporations had a remaining interest-rate fixation period of 3 months or less in February 2018. The primary purpose of repo rate forecasts has so far been to influence market rates, and periodically there have been major differences between the Riksbank’s forecasts and market expectations (see Sveriges Riksbank 2017b). 13  14  See Sveriges Riksbank (2012). 15  See Rachel and Smith (2015) and Holston et al. (2017). See, for instance, Duffie and Krishnamurthy (2016), Bernanke (2016) and Constancio (2017). 16  The Riksbank could reduce the liquidity surplus further by selling other assets, i.e. gold and foreign exchange reserves. But such a change of its asset holdings is not likely; the Riksbank has in the last decade instead enhanced its foreign exchange reserves by more than SEK 200 billion financed by loans in foreign currency. 17  18  See Greenwood et al. (2016), Constancio (2017) and Krishnamurthy (2018). This is still a simplified description of the Riksbank’s operational framework. See the references in footnote 6 for a more complete description.
Over time, we expect stronger governance within insurers to reinforce associations between financial reporting and fundamental economic factors, as intended by IFRS. In Malaysia, the finalisation of IFRS 17 is indeed timely in the light of current reforms being undertaken by Bank Negara Malaysia to further develop the domestic insurance market. This will see greater competition and complexity in the insurance sector, alongside a renewed impetus for growth through channel diversification and digitalisation. In this environment, the implementation of IFRS 17 will have an important role in improving the quality of information provided to the market on how these developments impact the performance of insurers, and in strengthening foundations for sound governance and risk management. This in turn will promote the effective functioning of insurance markets to serve the economy. Early preparation is key So then, where do we stand today? With less than two and a half years before the implementation date sets in, how prepared are insurers to implement IFRS 17? The answer is not encouraging. A recent survey published in January this year by a software firm covering some 240 insurance companies spread around the world, found that a startling 92% of insurers had yet to start putting solutions in place. Among those that have started, a vast majority are still only in the initial stages of planning.

Otherwise there is the danger that the burden of the adjustment will be born disproportionally by the traded goods sector that might have detrimental medium term consequences. While the near term outlook in the global economy is rather gloomy, the situation in Iceland is quite different. A prolonged growth phase was followed by one year, 2002, of a minor contraction, but at present we foresee a new period of growth when our task will be to maintain economic balance. The Central Bank is determined to keep inflation under control during the coming years of extensive activity in the economy, thus maximising the long term benefits of the extension of the export base. Ladies and Gentlemen The structure and diversity of the Icelandic economy has changed radically in recent decades and the legal framework has been modernized. Only a few decades ago the Icelandic economy had a narrow production base when fishing and fish processing were by far the most important activity. Today, the Icelandic economy has a broad base. Fishing continues to be important, but various industries have also developed, exploiting among other things the vast opportunities offered by the revolution in information technology. Strong companies successfully compete in the international market in various fields, including among other things communications and financial services. The liberalization and opening up of the economy demand close cooperation with other nations. In that respect it will be important to cooperate with businesses and public authorities in Europe, not the least in Germany.
In the current situation it can actually be claimed that there is no conflict. 1  The designation “inflation nutter”, describing a central bank only working towards stabilising inflation, was coined in a speech held by Mervyn King at a conference at Gerzensee, Switzerland in 1995, later published as King (1997). The designations strict and flexible inflation targeting were first introduced and defined, as far as I know, in a speech I held at a conference at the Banco de Portugal in 1996, later published as Svensson (1999). 2  BIS Review 22/2010  Figure 1 Monetary policy alternatives, February 2010 a. Alternative repo-rate paths 5.0 4.0 3.0 2.0 1.0 0.0 -1.0  d. CPIF 4.0  Per cent, quarterly averages  Annual percentage change  3.0 2.0 1.0 0.0 08  09  10  08  12  11  09  b.

Differences in reporting requirements can be seen as a barrier to achieving the full potential of this “single” market, to the extent that they impose an additional cost on those entities operating, or planning to operate, across borders. Not surprisingly, therefore, there have been a number of calls for regulators to work together to streamline the reporting requirements that apply to institutions which are active on a pan-European basis. The Committee of European Banking Supervisors, or “CEBS”, established two years ago and charged with promoting convergence of supervisory practices and cooperation and information sharing between supervisors, has risen to this challenge and has taken a major initiative in this respect, culminating in the publication of two sets of common reporting templates, one set for institutions to report their solvency ratio results under Basel II, and the other set for institutions to report financial information based on IFRS. These two projects take advantage of the two initiatives for convergence in international regulatory requirements I have already mentioned. Indeed, it would have been very difficult, if not impossible, to have made progress without them. Both the introduction of International Financial Reporting Standards and the implementation of Basel II are obliging supervisors to modify their existing reporting requirements and systems. This presents a window of opportunity to make progress on more convergent approaches. The benefits of a common reporting framework are clear, both for the institutions generating the information and for banking supervisors. From the standpoint of financial institutions, administrative costs will decrease, particularly for cross-border banks.
Now the IMF is assuming that it will only amount to just over 3 per cent. 1 The speed of the global economic downturn is unparalleled in modern times and has come as a surprise to the Riksbank and many other forecasters. At the beginning of September we were expecting world growth to amount to almost 4 per cent in 2009. In the Monetary Policy Report we published in February we are instead forecasting almost zero growth this year. Developments in the world economy are thus expected to be the weakest since the beginning of the 1980s. Inflation has fallen significantly in recent months. It rose rapidly in 2007 and up to summer 2008, primarily as a result of rising energy and commodity prices. Since then the price of oil has more than halved. This has led to a rapid changeover from high to low inflation. In July inflation in the OECD countries was close to 5 per cent. In January it had fallen to zero per cent in the United States and to around 1 per cent in the euro area. Over the coming six months we will probably see very low or negative inflation in some industrial nations. Inflation excluding energy and food prices has been more stable in recent years. In the United States, core inflation has fallen slightly, but only from 2.5 per cent during the first half of 2008 to 1.7 per cent in January 2009. In the euro area, core inflation is just below 2 per cent.

Jean-Claude Trichet: Introductory remarks at ETUC Congress Speech by Mr Jean-Claude Trichet, President of the European Central Bank, at the 11th ETUC (European Trade Union Confederation) Congress, Seville, 22 May 2007. *  *  *  Let me begin with a few remarks about the importance of price stability for the welfare of euro area citizens. The successful maintenance of stable prices and longer-term inflation expectations that are securely anchored at levels consistent with price stability is a necessary condition for attaining sustainable growth in economic activity and sustainable employment creation. Looking back over the period since the euro was launched euro area inflation has indeed been very close to 2% on average. Stability-oriented monetary policy has therefore directly improved the well-being of euro area citizens, inter alia, by supporting the purchasing power of their income and savings. While single monetary policy continues to deliver on its mandate, the euro area economy also faces significant challenges that point to the need for structural reforms. Among these challenges, improving the productivity performance of the euro area is particularly important: at the level of the euro area as a whole, the average annual increase of labour productivity declined from 1.6% between 1991 and 1998 to 0.8% between 1999 and 2006, whereas it increased in the United States from 1.3% to 2.2%. Pursuing structural reforms is also essential to maintaining the competitiveness of the euro area as a whole and to translating the opportunities brought about by globalisation into achievements.
Strong and bold entrepreneurial and political leadership is now required to see the necessary changes for the financial system through, as demonstrated today by the G20 leaders in Pittsburgh. Clearly, there are many areas in financial regulation that can and in many cases should be improved. Given what is at stake, there is clearly a need to prioritize. I have briefly laid out to you this evening where I see those priorities. Thank you for your hospitality and patience. BIS Review 115/2009  5

Furthermore, a specialised newspaper boasting the strength and the prestige of Ziarul Financiar has the obligation to judiciously calibrate any piece of information with an analysis of its significance. For instance, the media have adopted a bleak, sometimes apocalyptic, tone these past few days amid an abundance of news alerts on the likely number of unemployed over the upcoming months, i.e. around 30,000 individuals. Of course, taken individually, anyone being made redundant is faced with a tough issue. However, from an economy-wide perspective, the rise in unemployment by 30,000 people only accounts for about 0.5 percent of the workforce. Coupled with the very low level of unemployment (3-4 percent) prior to the outbreak of the ongoing global recession, the economic analyst will conclude that unemployment is hardly a pressing issue in Romania for the time being. On the other hand, it is equally true that the short-term outlook for the domestic economy is not and cannot be too favourable. To the bleak international environment added what we may also call the irrational exuberance of both markets and, on many occasions, state authorities. In my opinion, the mixture between a hostile external environment and what seems to be an inadequate domestic response to this environment stands out as the underlying reason for which rating agencies have downgraded, sometimes rather severely, our sovereign rating. Of course, we may voice our discontent with the rating agencies’ evaluation. At times, rating agencies themselves have facilitated our criticism.
Sabine Lautenschläger: Interview in Der Standard Interview with Ms Sabine Lautenschläger, Member of the Executive Board of the European Central Bank, in Der Standard, conducted by Mr András Szigètvari on 27 March 2019 and published on 1 April 2019. * * *  Can you enlighten us: is the ECB stealing interest income from savers, are savers being dispossessed? Many German economists and politicians are convinced of exactly that, leading them to harshly criticise the ECB leadership under Mario Draghi. I appreciate that people are concerned, it’s true that putting money into a savings account these days will earn you very little interest. But it’s also true to say that people can only save if they have a job and earn enough money to put some savings aside. Our monetary policy has made an important contribution to boosting employment and wage growth. And people are not only savers, but also entrepreneurs and home buyers, who benefit from low interest rates. So the question we need to ask ourselves is: if the ECB had not taken certain measures in the past, what state would the economy be in today? And how would you answer that? There was a high risk of deflation in the euro area. Deflation would have meant falling prices, with people therefore postponing their purchasing decisions in anticipation of prices falling even further. At the same time, firms would have reined in investment and there would have been job cuts. That is a vicious circle.

As far as economic growth is concerned, there have been repeated setbacks over the past few years. Geopolitical uncertainties such as Brexit and the threat of protectionism are currently weighing on economic sentiment. That is also why inflation remains subdued. Moreover, it has taken a long time for the decline in unemployment to be reflected in higher wages. The number of people who lost their jobs in the crisis but never registered themselves as unemployed has been underestimated. When the economy revived, these people returned to the labour market. A great many people, above all part-time workers, began to work longer hours when the upswing set in. In brief, the labour supply was underestimated. It’s only when the labour market has thoroughly cleared that 1/3  BIS central bankers' speeches  wages start to climb more steeply. We’re seeing that in Germany for example. One serious criticism of the ECB’s programme is that it is effectively only subsidising the southern crisis countries. The central bank has pushed interest rates down. Without this life-saver, Italy would have gone bankrupt long ago and the euro would have been history. Hold on a moment. All have benefited from the measures. The savings for taxpayers resulting from lower interest rates were nowhere as high as in Germany. But isn’t it also true that the ECB is indirectly financing governments here? Any creditor who invests in Italian or Spanish government bonds knows that the ECB will buy these bonds off them in the future.