samchain/econo-pairs-v1 huggingface dataset:
speech by Ben S. Bernanke, “Monetary policy since the onset of the crisis”, Federal Reserve Bank of Kansas City Economic Symposium, Jackson Hole, Wyoming, 31 August 2012. 3  In a foreign exchange swap, a given amount of foreign currency is purchased and sold simultaneously for two different dates. Consequently, this is a money market transaction that does not involve any exchange rate risk, thus differing from foreign exchange interventions. 2  BIS central bankers’ speeches  monetary conditions. Once the economic recovery had gained hold, the foreign currency purchases were suspended in June 2010. However, in summer 2011, the situation became so acute that the SNB had to take action again. After having employed the less far-reaching measures which I mentioned before, we set a minimum exchange rate against the euro on September 6, 2011. Since then, the SNB has made it perfectly clear that it is prepared to enforce this minimum rate through unlimited foreign currency purchases, if necessary. In setting a minimum exchange rate against the euro of CHF 1.20, we were reacting to the extreme appreciation in the Swiss franc. As you may recall, the price of the euro temporarily fell to as little as CHF 1.00 and that of the dollar to 70 centimes. The SNB’s aim with the minimum exchange rate is not to fine-tune the economy, but to provide the market with some guidance during a phase of great uncertainty.

The requirement for increased flexibility in the labour market could apply both to increased variability in nominal wage increases and to increased geographical and professional mobility of the labour force. Increased adaptation to the rate of wage increase in the Euro area and increased variability in nominal wage costs? The design of the negotiation system probably has significance both for the adaptation of wage increases to that within the Euro area and for the degree of nominal wage flexibility. Wage formation in Sweden can be characterised by a combination of centralised and decentralised agreements. During 2001 trade and industry had a relatively high percentage of agreements with local wage formation. Almost 70 per cent of employees in the private sector had wage agreements that entailed complete or partial local wage formation. The percentage of local wage agreements in the public sector has also increased during the 1990s. A more decentralised wage formation process could entail greater nominal wage flexibility, as wage costs could then be connected to a greater extent to the individual company’s situation. On the other hand, a more co-ordinated wage formation could also entail increased flexibility, as it would make it easier for those determining wages at a central level to take the overall considerations required to enable the economy as a whole to develop favourably. It is unclear to what extent a potential Swedish participation in Stage Three of EMU would entail incentives for a more decentralised or more co-ordinated wage formation process.
In the light of the prevailing uncertainties, it is essential that the bank lending channel continues to function well. To sum up, a cross-check of the outcome of the economic analysis with the signals coming from the monetary analysis confirmed the need to preserve an appropriate degree of monetary accommodation in order to secure a return of inflation rates towards levels that are below, but close to, 2% without undue delay. Monetary policy is focused on maintaining price stability over the medium term and its accommodative stance supports economic activity. As emphasised repeatedly by the Governing Council, and as again strongly echoed in both European and international policy discussions, in order to reap the full benefits from our monetary policy measures, other policy areas must contribute much more decisively, both at the national and at the European level. The implementation of structural reforms needs to be substantially stepped up to reduce structural unemployment and boost potential output growth in the euro area. Structural reforms are necessary in all euro area countries, although specific reform needs differ across the individual economies. The focus should be on actions to raise productivity and improve the business environment, including the provision of an adequate public infrastructure, which are vital to increase investment and boost job creation. The enhancement of current investment initiatives, including the extension of the Juncker plan, progress on the capital markets union and reforms that will improve the resolution of non-performing loans will also contribute positively to this objective.

William C Dudley: Lessons learned from the financial crisis Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Eighth Annual BIS Conference, Basel, 3 July 2009. *  *  *  In assessing the lessons of the past two years, I will focus on five broad themes that are interrelated: •  Interconnectedness of the financial system  •  System dynamics – How does the system respond to shocks? •  Incentives – Can we improve outcomes by changing incentives? •  Transparency  •  How should central banks respond to asset bubbles? As always, my views are my own and may not necessarily reflect those of the FOMC or the Federal Reserve System. Interconnectedness This financial crisis has exposed how important the interconnections are among the banking system, capital markets, and payment and settlement systems. Focus on only one part of the financial system can obscure vulnerabilities that may prove very important. For example, the disruption of the securitization markets caused by the poor performance of highly-rated debt securities, led to significant problems for major financial institutions. Banks had to take assets back on their books; backstop lines of credit were triggered; and banks could no longer securitize loans, increasing the pressure on their balance sheets. This reduced credit availability, which increased the downward pressure on economic activity, which caused asset values to decline further, increasing the degree of stress in the financial system.
Yet at that time, financial crises were a phenomenon felt to be confined to emerging markets. Advanced economies, it was thought, knew better. This, too, would come back to haunt us. Resolving emerging market crises was one thing, redesigning the international financial system to forestall them quite another. Working alongside HM Treasury colleagues (including Sir Jon Cunliffe – another whose path I have lost track of), an intensive programme of international reform began with the aim of preventing a  10  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  10  repetition of these emerging market crises. As part of the Bank’s contribution, under Eddie and Mervyn’s guidance, I worked with the Bank of Canada to produce a blueprint for international monetary reform.13 This blueprint proved controversial, as it proposed restrictions on the IMF’s ability to extend credit to countries in crisis. That jarred with IMF orthodoxy, including the then-Deputy Managing Director Stan Fischer, who at the time was proposing the IMF become an international lender of last resort.14 It also jarred with US orthodoxy. Under Larry Summers and Tim Geithner, the US Treasury had overseen the emerging market bailouts from Mexico in 1994 onwards. In 2002, I was asked by Tim Geithner (now at the IMF) to go to Washington to work on international financial system design, alongside two former US Treasury colleagues, Nouriel Roubini (now better known as Dr Doom) and Brad Setser. There were no prizes for spotting the odd one out.

As MAS Chairman Mr Tharman Shanmugaratnam puts it in his Foreword to this year’s Annual Report: “MAS has progressively over the five decades become a central bank and integrated financial supervisor of repute amongst its international peers, a source of confidence domestically, and an active partner with the industry in developing opportunities for Singapore’s growth as an international financial centre.” My colleagues and I are deeply conscious of the legacy which we have inherited and will continue to do our best for Singapore: to secure for Singaporeans a low rate of inflation; to preserve the purchasing power of Singapore’s official foreign reserves; to keep Singapore’s financial system safe and sound; and to grow Singapore as a vibrant international financial centre. With that, let me close my remarks. Thank you. 1 June 2021 Consensus Forecasts. 2 Comprising Indonesia, Malaysia, Thailand, the Philippines and Vietnam, and weighted by shares in  Singapore’s non-oil domestic exports. 3 Purchasing Managers Index which tracks expectations for future output. 4 Future output sub-indices drawn from the composite PMIs for China and Hong Kong. For all other Asia ex-Japan  economies, the manufacturing future output sub-index is used. 5 June 2021 Consensus Forecasts weighted by Singapore’s non-oil domestic exports shares. 6 MAS Macroeconomic Review April 2021. 7 DBS Bank, Oversea-Chinese Banking Corporation, United Overseas Bank, Citibank, Malayan Banking Berhad,  Standard Chartered Bank, and the Hong Kong and Shanghai Banking Corporation.
The jury is still out concerning the final verdict as to which of the two views is right. In my opinion, however, one general conclusion is valid: a monetary policy strategy which carefully monitors money and credit developments is likely to contribute to the detection of potentially destabilising financial imbalances is likely to help detect potentially destabilising financial imbalances at an early stage. V.  Conclusions  Our discussion on how to manage globalisation comes at a difficult moment in time, a challenging period for financial markets and institutions worldwide, and a period of heightened uncertainty about the potential impact of the ongoing reappraisal of risk on the real economy. This makes this joint intellectual effort to understand the underlying mechanisms and forces of globalisation even more topical, and our joint quest to identify ways to manage globalisation even more valuable. In my contribution, focusing on the central banker’s perspective, I argued, first, that globalisation does not fundamentally undermine the effectiveness of monetary policy in preserving price stability. Although the channels through which monetary policy affects economic variables are certainly influenced by globalisation, the respective effects are  22  See Borio and Lowe (2002). 23  See ECB (2007a), Box 9 for an elaboration of the measurement of financial market liquidity. 24  See Rajan (2005, 2006). 25  Adalid and Detken (2007). BIS Review 9/2008  11  estimated to be small.

Luis de Guindos: Interview in Corriere della Sera Interview with Mr Luis de Guindos, Vice-President of the European Central Bank, in Corriere della Sera, conducted by Mr Federico Fubini on 13 June 2019. * * *  The 5y5y forward inflation rate is at an all-time low and clearly below where it was when Mario Draghi first hinted at quantitative easing (QE) in 2014. The ECB has already done some more easing and President Draghi himself mentioned that there was an interesting discussion at the latest Governing Council meeting on different tools to do some more easing – the asset purchase programme (APP) and others. What do you need to see in order to decide to do more? What we need to see is a de-anchoring of inflation expectations. This has not yet happened, despite the fact that there has been a drop in market-based inflation expectations. If you look at the survey of professional forecasters, the situation is a little bit different – expectations have remained stable. Then we need to see if there is a significant additional drop in economic activity – a crystallisation of the downside risks that we have indicated. We can always try to look forwards to get an idea of what might happen, but ultimately the reality is the reality. And, well, let’s see what happens. But I think the important part of our stance is that we are totally ready to react. We will have time enough to know the future when it arrives.
This prudent behaviour of the banks and the BNB during the economic boom, however, also had its origins further back in history. It followed the well-learnt lessons from a still earlier period – the great financial and banking crisis in the mid-1990s. We will leave it to researchers into Bulgaria’s modern economic history to mark out the different stages – such as for instance the initial point at the onset of transition characterized by a huge state ownership in the banks and the hectic emergence of a great number of private banks amidst a just-forming banking supervision and regulations; the state’s interference in the credit processes and banks’ decapitalisation in the mid-1990s; the sector gradually freeing itself from political dependence; the privatisation and foreign capital inflow (mainly from EU countries); the development of modern regulations and the building up of supervisory experience. However, even now we could sum up, and it would not at all be far-fetched, that the history of modern banking is the best part of Bulgaria’s history of socioeconomic transition after the changes that took place in 1989. Today Bulgaria has a modern and sound banking system. Still, a responsible behaviour implies the need of not only recognising what has been achieved, but preserving it too. Because the banking sector in Bulgaria has played a major role for the overall economic growth after the stabilisation and the introduction of the currency board regime in 1997.

Bulgaria remained one of the few EU member states, where not a single credit institution needed to be rescued with taxpayers’ money. Banks in this country not only could never be blamed for the economic downturn and have not been a source of systemic risks but just the opposite – they continue to be one of the main pillars of the macroeconomic and financial stability in the country. As a logical outcome, the stability of the banks in Bulgaria has won the confidence of domestic depositors – by the end of February the deposits of households increased year on year by 13.2%. Owing to this, an important structural trend is noticeably confirmed – gradually and with no significant upward pressure on the interest rates on deposits, the dependence on attracted resources from external sources has been reduced to an acceptable minimum. For example, at the end of February around 12% of total attracted resources were from foreign parent banks, compared to almost one fourth at the end of 2008). When we look back we realise that the current state of the banking system in Bulgaria is largely due to what was done over the years immediately preceding the global crisis. Instilling a prudent behaviour in the banks in that period through BNB’s conservative and anti-cyclical supervisory policies, regardless of the pursuit of market shares and profits, equipped the banks for the ensuing crisis with solid liquid and capital buffers.
But we have seen time and again how quickly responsible can turn to reckless, creating risks that ultimately derail the economy. Allow me to explain why this matters to everyone from Land’s End to John O’Groats, even those who do not own homes. History shows that the British people do everything they can to pay their mortgages. That means cutting back deeply on expenditures when the unexpected happens. If a lot of people are highly indebted, that could tip the economy into recession. Recessions that follow periods of rapid credit growth tend to be deeper and longer lasting. Since we start from a vulnerable position, we need to be especially careful. To insure today against such risks in the future, the Bank has introduced both new affordability tests for borrowers and a cap on the proportion of any lender’s new residential mortgages at high multiples of borrowers’ incomes. By acting early, the Bank can reduce the need for more drastic action later on. And by acting as we have, we can encourage a broadening of the housing market recovery. We recognise that there are large differences in housing markets across the UK. Around one in five new London mortgages are extended at or above 4.5 times borrower income, compared to one in ten across the UK as a whole, and one in twenty in Scotland. Capping the riskiest borrowing means that for every high ratio mortgage six must be extended at lower ratios.

For regions where country-level data is not available, chart assumes that UK exports are distributed between Commonwealth and “Other” countries in proportion to the number of those types of countries in each region. BIS central bankers’ speeches  Table 1: Annual average growth rates of trade and GDP (per cent) United Kingdom(a) Exports  Imports  1701–1830  GDP 1.1  1830–70  5.0  4.4  2.0  1870–1913  2.9  3.1  1.9  1913–50  1.3  0.7  1.5  1950–73  4.4  4.4  2.6  1973–2001  4.8  5.1  2.4  Trade  GDP  World(b) volume 1500–1820  1.0  0.3  1820–70  4.2  0.9  1870–1913  3.4  2.1  1913–50  0.9  1.8  1950–73  7.9  4.9  1973–2001  5.2  3.1  1820–2001  3.9  2.2  (a) Bank calculations and Hills, Thomas and Dimsdale (2010), “The UK recession in context – what do three centuries of data tell us?”, Bank of England Quarterly Bulletin, Q4. (b) Table 6 in Angus Maddison (2005), Growth and interaction in the world economy: the roots of modernity, The AEI Press, Washington. BIS central bankers’ speeches  7
Conversely, a peg that would leave the franc undervalued would lead to a monetary policy that is too lax. Third, as a rapid appreciation of the Swiss franc would most likely be the result of problems in the EMU, it would be illogical to link our currency to an anchor currency whose stability is doubtful and questioned by the markets. We would give up our record of stability in favor of a yet unproven monetary policy. A temporary peg would alleviate some of the problems associated with a permanent fixing of exchange rates. Monetary autonomy would be further restricted, but not completely lost. Interest rates would thus most probably not rise to the same level as in the case of a permanent peg. However, by placing a temporary ceiling on the exchange rate of the Swiss franc, the SNB would lose -- albeit temporarily -- control over the money supply. It would thus run the risk of triggering a subsequent rise in inflation. I would regard a temporary peg only as a measure of last resort in the event of extreme exchange rate disturbances. It is sometimes argued that impediments to inflows of foreign capital might be helpful in fighting an appreciation of the Swiss franc. Historic evidence, however, lends little support to this view. In the second half of the 1970s, Switzerland was confronted with a strong appreciation of the Swiss franc. To curb this appreciation, our authorities, among other things, tightened existing and introduced additional controls on inflows of foreign capital.

Real convergence encompasses factors such as labor mobility, price and wage flexibility, exposure towards external shocks, industrial structures, and so on. Judged by these factors, convergence among future members of the EMU still has a long BIS Review 102/1997  -3-  way to go. This is important because to be successful a European monetary policy depends exactly on these factors. Without a high degree of real convergence, monetary policy is bound to have different effects in different parts of the monetary union. The very idea of a single European monetary policy would thus become unrealistic. The ECB would come under political pressure to accommodate mutually incompatible wishes from different parts of the monetary union. The result could only be a less than optimal monetary policy and rising inflation and interest rates. For EMU to be successful the member states of the EU should therefore make determined efforts to further real convergence. The convergence criteria as laid down in the Maastricht Treaty require member states of the EU to achieve certain goals by spring 1998. Convergence, properly understood, can however never be something that can be pinpointed to a certain point in time, but must be an ongoing process. It does not make sense to require countries to get their fiscal situation under control by a certain date, just to let them go unpunished on a public spending spree shortly afterwards. Prudent fiscal policies should not only be a requirement for becoming, but also for remaining part of the EMU.
Step 1: Initiation of financial sector consolidation The Central Bank initiated the planning of the consolidation programme several years ago, and since then, a number of things have been done to bring it into reality, with procedures being carefully articulated for smoother implementation. As a result, in 2013, the Central Bank officially informed the Ministry of Finance, through a Budget Proposal, of the need for a strong and dynamic financial sector, by consolidating the institutions in the banking and nonbanking sectors in a prudent manner to ensure enhanced financial system stability and to spearhead economic growth. To support this initiative, His Excellency the President, in his Budget Speech on 21 November 2013, proposed to grant special tax concessions for expenditure incurred by banks and NBFIs, if they merge with, or acquire one or more financial institutions. Further, in view of providing better financial services for the development activity of the country, His Excellency proposed that two development banks, that is, NDB and DFCC be merged, for which too, qualifying payment status would be granted. Ladies and gentlemen, as the Central Bank is charged with the duty of securing financial system stability by its mandate, the major responsibility of implementing the consolidation programme announced by His Excellency the President was entrusted to the Central Bank. Further, in order to meet the funding requirements for the implementation of the consolidation programme, the Monetary Board approved a budgetary allocation from the Central Bank.

Also, under the Basel III requirements in the run-up to 2019, the  BIS central bankers’ speeches  11  quantity and quality of capital needed to be maintained is higher to meet the regulatory requirements of core capital and leverage ratios. Under the capital enhancement plan, the Central Bank will increase the entry capital requirement for new banks incorporated in Sri Lanka from its current level of Rs. 5 billion to Rs. 10 billion, commencing 2016. Meanwhile, for existing banks incorporated in Sri Lanka, commencing 2016, minimum Tier I capital requirement will be increased for Licensed Commercial Banks and Licensed Specialised Banks from Rs. 5 billion in 2015 to Rs. 10 billion, and from Rs. 3 billion in 2015 to Rs. 5 billion, respectively. However, branches of Foreign Banks operating in Sri Lanka are excluded from the capital enhancement requirement as they have backup funding arrangements from their parent banks. Similarly, the NBFIs are required to enhance the core capital from Rs. 400 million in 2014 to Rs. 1.0 billion by 2015 and further to Rs. 1.5 billion by 2018. Third: Human resources aspects Ladies and gentlemen, managing the concerns of employees and winning their confidence and support for the consolidation programme is very important for the smooth execution of this process. The Central Bank has informed all financial institutions involved in the consolidation programme that this process should not adversely affect the staff of the respective financial institutions.