samchain/econo-pairs-v1 huggingface dataset:
And second, what about the readiness of other payment instruments, in particular payment cards? Let me first give you my views on the readiness of the customer. Readiness of customers? A parallel can be drawn with another major project, namely the changeover to the euro notes and coins in 2002. Indeed, as with SEPA, many of the preparations for the euro changeover were not visible to the citizens, as they were carried out by technical experts. Furthermore, the banknotes’ security features were disclosed only four months before the launch. As with SEPA, it was difficult to predict how the customer would react. On the other hand, well before the euro changeover took place, the central banking community discussed customer readiness in depth with the aim to ensure acceptance of the euro notes and coins. Well in advance of 2002, the Eurosystem started organising a “partnership programme” that involved the main bodies in the various sectors. This partnership programme emerged from the “megaphone idea” and the understanding that communication on the changeover to the euro had to be at national level by the national public authorities, banking communities and end-user associations. Each sector was encouraged to inform their target groups. Indeed, as if with a “megaphone”, the Eurosystem passed on a common set of key messages to target groups, and they in turn passed on the information to others. Applying the principle of subsidiarity in this context proved itself as the correct way to deal with differences in culture, language and institutional setting.

I would like today to express the views and expectations of the Eurosystem on the SEPA project. But let me first take a brief look at past achievements. The 2006 SEPA Summit focused mainly on building up all relevant stakeholders’ commitment to SEPA. Last year, the President of the ECB and myself underlined the opportunities which financial integration in general and SEPA in particular could bring to the economy. We also concluded that much more had to be done to reap these benefits. I specifically called for a closer involvement and dialogue with all stakeholders. Since then a lot of progress has been made and I am glad to see that, in general, the SEPA project is well on track. The basic SEPA components for euro payments have been developed, such as the SEPA credit transfer and the SEPA direct debit, as has the regulatory framework under the Payment Services Directive. Each national community has set up a forum for stakeholders to discuss the upcoming changes related to SEPA, and a European forum has been established. It is also impressive to see that many banks have made substantial preparations in order to launch the SEPA credit transfer in January 2008. It is expected that over 80% of banks representing the majority of credit transfer transactions (over 90%) will be operationally ready. The banks will demonstrate their commitment to SEPA at a signing event at the end of today. Financial integration is also progressing well in other fields.
I have covered just some of the questions which seem to us to be particularly relevant at present – and as markets evolve no doubt new topics and questions will present themselves. I encourage those of you with an interest in this area to keep running with it –your input is of great value to us. Keeping up with fast markets isn’t easy. But with your help I’m sure we can rise to the challenge of ensuring that fast markets are there to serve the real economy, both in good times and bad. Thank you. 20  For example, see Schooling Latter (2016), ‘Electronification of trading’. 9  All speeches are available online at www.bankofengland.co.uk/speeches  9  Chart 1 Recent episodes of heightened shortterm volatility in liquid markets  (a)(b)  S&P 500 Index: 100 = intraday trough 10-year US Treasury yield 120 Sterling/US dollar exchange rate 115  110  105  60  30  0  -30  -60  -90  -120  -150  -180  100 Minutes since trough  Sources: Bloomberg and Bank calculations (a) Sterling flash event 7 October 2016 (blue), US equity markets flash-crash 6 May 2010 (magenta), and US Treasury market flash-rally 15 October 2014 (orange).

This rising tide of responsibilities is not confined to monetary policy. Around 80% of central banks have some role in setting new macro-prudential tools. 12  The Bank of England is among the over 50% of central  banks fully in charge of doing so. In the US, responsibility is shared across agencies, including the Fed. In the European Union, responsibility is also spread across agencies, including a number of central banks. In the run-up to the financial crisis, micro-prudential policy was increasingly located outside central banks. Since the crisis, however, that trend has reversed (Chart 3). The ECB has assumed responsibility for supervising the euro area’s largest banks. The Federal Reserve’s supervisory responsibilities have been expanded and enhanced. And in the UK, micro-prudential supervision has returned to the Bank. 13  The most recent chapter in central banks’ evolutionary history has been increased openness and transparency about their actions, monetary, macro- and micro-prudential. This shift was a natural  9  Consistent with that, the historical evidence suggests that institutions, such as central banks, are essential elements of statecraft (Acemoglu and Robinson, 2012). 10 See for example, Cukierman et al (1992), Grilli et al (1991), Crowe and Meade (2007), Arnone et al (2006), Dincer and Eichengreen (2014), Bodea and Hicks (2015) and Garriga (2016). 11 The Cukierman et al (1992) index, updated and expanded by Garriga (2016). 12 Claessens et al (2016), discussed in Blinder et al (2017).
Zeti Akhtar Aziz: Current challenges confronting central banks Opening and keynote address by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the SEACEN-BNM Banking and Financial Law School 2009 "Current Challenges in Central Banking – Legal Perspective", Lanai Kijang, 24 September 2009. *  *  *  It is my great pleasure to speak at the 5th Banking and Financial Law School 2009, jointly organized by the South East Asian Central Banks (SEACEN) Research and Training Centre, the Institute of Bankers Malaysia and Bank Negara Malaysia. The theme for this year's Banking and Financial Law School on "the legal perspective of the current challenges in Central Banking" has particular relevance in the present environment. Indeed, global attention is now focussed on an overhaul of the financial architecture in the efforts to address the fundamental weaknesses that have surfaced in this recent global financial crisis. The current policy debates cover a wide ranging set of issues that include far-reaching regulatory reforms to strengthen the foundations for financial stability, institutional arrangements to achieve more efficient functioning of financial markets, effective coordination of financial stability measures and greater clarity of central bank mandates in promoting monetary and financial stability. The theme of this conference also has special relevance to us at Bank Negara Malaysia, as our new Central Bank of Malaysia Act 2009 will come into force later this year.

First, since banks that do not directly participate may benefit from the overall improvement in the market conditions, a free rider problem arises. Therefore, intervention should be conditional on the participation of a critical mass of banks. Second, if the conditions are very favourable, banks may choose strategically to participate in the programme, thus increasing its overall cost. Hence, it is paramount that the intervention entails some costs for the current shareholders. I don’t need to stress how relevant these issues became, especially in the aftermath of the financial crisis, when massive intervention in the banking industry had imposed very large costs on Europe’s taxpayers and had significant consequences for the sovereigns. Indeed, a key concern for policy-makers is that the large support offered to the financial sector may spur opportunistic behaviour and generally distort financial institutions’ risk-taking incentive, possibly magnifying the costs of the intervention while reducing its effectiveness. Thomas Philippon’s analysis is timely and tackles a very relevant issue as new rules for intervention and resolution of banks are currently being implemented. The new EU rules surrounding  3  See, for example, Heider, F., M. Hoerova, and C. Holthausen, (2009) “Liquidity hoarding and interbank market spreads: the role of counterparty risk”, ECB Working Paper No 1126 on the role of asymmetric information in the interbank market freeze during the recent financial crisis. Moreover, the de Larosière report pointed to the lack of transparency as being one of the causes of the financial crisis (EU Commission, 2009).
The analysis and projections in this Report contribute to the understanding of how the Central Bank exercises its responsibilities, as well as the opportunities and challenges that we face together. We remain at your disposal to deepen this discussion. Thank you. ***  7  Figure 1 Quarterly GDP change (1) (2)  Imacec (1) (3)  (contribution, percentage points)  (quarterly change, percent)  2.0  2.0  2.4  1.5  1.5  1.8  2.4  Imacec  Other  1.8  non-mining GDP  1.0  1.0 EGA  0.5 0.0  Fishery  -0.5 2017Q1  2017Q3  1.2  1.2  No minero  0.5  0.6  0.6  0.0  0.0  0.0  -0.5 -0.6  -0.6  2018Q1  15  16  17  18  (1) Seasonally-adjusted series. (2) Other includes trade, manufacturing, financial and entreprenurial services, construction, agriculture, transport&communications, housing services, personal services, public administration, VAT and import duties. (3) Moving quarters. Source: Central Bank of Chile.

With the new Act, the SNB specifically bears the responsibility of overseeing the systemically important payment and securities settlement systems. The operators of such systems will in future have to meet certain minimum requirements, which will also include requirements with regard to information security. Secure and reliable information and communications structures are an essential precondition for the smooth functioning of the financial system. In the context of its mandate, the SNB limits itself to systems-relevant aspects in these areas. Systems-irrelevant problems concerning individual banks or payment systems, by contrast, are explicitly not a part of its mandate. This is based on the conviction that the problems in the financial system must be solved by the market itself whenever possible. BIS Review 32/2004  1
2  Rogoff, K (2003), ‘Globalization and global disinflation’, paper prepared for the Federal Reserve Bank of Kansas City conference on ‘Monetary Policy and Uncertainty: Adapting to a changing economy’. BIS Review 11/2004  1  track record of success, built up over more than a decade, has progressively reinforced the credibility of these targets. As a result, people and firms have increasingly come to expect inflation to stay close the official target - a belief which itself helps to keep it there. Clearly the world has changed. For sure, there is still much we do not understand both about the ebbing of global inflationary pressures over the past decade and about the impact of low inflation on the way that people behave. And there have been crises, such as the stock market crash and September 11. By past standards, though, modern monetary policy is a less melodramatic affair. Has policy making become easier? I don’t think so, though I suspect it looks that way. But let met give a fuller answer by setting out how the present approach to setting interest rates works; and outlining some of today’s challenges. The policy framework I’ll start with inflation targeting, as it has been implemented in the UK since 1997. The institutional framework is set out in some detail in the 1998 Bank of England Act. This is extremely clear both about the aims of monetary policy and about the respective roles of the Government and the Bank.

Here is Chancellor Denis Healey, writing in his memoirs3 about a spat with the Prime Minster of the day:  3  2  Healey, D (1989), The time of my life, Michael Joseph London. BIS Review 11/2004  ‘At this time my own relations with Jim were shaken by an incident just after the Party Conference. On October 6 I had asked him to let me raise interest rates by another 2 per cent to the then unprecedented level of 15 per cent…He refused. I said I wanted to take the matter to Cabinet that morning. ‘All right’ he replied ‘but I will not support you.’ Nevertheless I insisted…’ In the event this did not prove necessary: Callaghan backed down, leading Healey to comment wryly that ‘This was the only time I have ever used the threat of resignation to get my way.’ The new framework has taken the politics out of interest rate decisions without sacrificing democratic accountability or oversimplifying the policy process. It is an elegant institutional solution to the lengthy debate between those who favoured untrammelled discretion and those who advocated rules (such as monetary targets); one, moreover, which manages to respect the constitutional priorities of a parliamentary system. Achievements Performance over the six years since the Bank became independent has been impressive. Against the target of 2.5% for RPIX which ran from 1997 until December 2003, average inflation was 2.4%.
This effort has been sufficient to create a primary surplus and, along with growth in the economy from H2/2010 onwards, to put debt on a downward trajectory as a share of GDP, which is predicted to be 85% gross and below 60% net in 2015. But this has not come without significant pain, and again, would not have been possible if private bank liabilities had been guaranteed more than was needed to keep the domestic payment system and basic banking services up and running. Let me conclude by summarising some of the potential lessons from this tale: 1. Iceland did not allow its entire banking system to collapse, it did not nationalise its banking system, and it did not default on sovereign debt. So, in spite of what one sometimes hears, the Icelandic case does not teach any lesson on the pros and cons of such measures. 4  BIS central bankers’ speeches  2. Iceland avoided sovereign default through a good initial fiscal position, the ringfencing of the sovereign as much as possible from collapsing cross-border banks, and a medium-term fiscal consolidation programme. The lesson is to practise fiscal prudence and avoid the socialisation of private sector losses. 3. Iceland protected its domestic payment system and deposits. The lesson might be bail-in, separability in resolution between the public utility element of banking from the rest, and deposit preference. 4. The EU system for cross-border banking is deeply flawed.

Closer to the region, a recent report by the Asian Development Bank (ADB) highlighted that South East Asian countries require funding worth USD3.1 trillion for climate-adjusted infrastructure in the region by 20301. In Malaysia, among other means, green financing is being rolled out through schemes such as the Green Technology Financing Scheme (GTFS). Some institutions are allocating capital and steering financial flows towards more low-carbon, climate resilient activities. However, considerable funding gaps remain. Public finance will likely be inadequate for this task and there is inevitably a need to draw in private capital. The renewable energy sector for example, requires a total of RM33.5 billion of funding by 20252, based on the projections provided by the Sustainable Energy Development Authority (SEDA) Malaysia. There is no ready panacea to the funding issues that we face. We need to understand the root cause to come up with possible solutions. In my view, one of the most critical issues is the mismatch in funding demand and supply; and information asymmetry. We need to find a way to bridge the language and information gap between scientists, government and financiers. What science says about climate effects, what climate action the Government is prioritising, what industries are providing and investing in – are quite incongruent at this point. While there is now a stronger demand for green financing, it is not matched by the supply side, due to information gaps between financiers and green promoters.
Besides, there is a persistent and visible recovery in inflation dynamics, and thus the inflation inertia has, to a great extent, been. When we consider where we are after four years of fighting inflation following the crisis, we see that CPI inflation, which was 73.2 percent by January 2002, remained below the end year targets for three consecutive years, declining to single digit figures; annual CPI is realized as 7.94 percent in March 2005. The total decline in inflation during this period was more than 65 percent. This favorable development was apparent in the expectations as well. While the reliability difference, which is the difference between target inflation and inflation expectations, was 13.3 point at the beginning of 2002, it dropped to 0.4 points at the beginning of 2005. As of today, according to the results of the survey of expectations of the Central Bank of the Republic of Turkey, the year-end inflation expectation dropped to 7.5 percent. This figure is below the official target of 8 percent. As well as being a concrete indication of the fact that the inflation inertia has been broken to a great extent, this improvement in inflation expectations is clear evidence of the increased confidence in monetary policy. Moreover, this situation shows that the inflation target will be a nominal anchor for economic units in their future decisions.

At this point, it is important to underline once more the damage caused by high inflation in order to remind us why should do everything in our power to stick to the price stability objective. This is especially important in an environment where the benefits of overcoming inflation are not yet fully understood. The consequences of failure to maintain price stability, in other words, the damage caused by inflation, can be clearly seen in our country both in society and in the economy, as is the case in all countries that have experienced high and chronic inflation. High inflation, one of the main reasons for poverty, depravation, unfair distribution of income, and the economic instability environment it creates has been one of the most influential impacts of inflation on society. The legacy of inflation on poverty, depravation and the unfair distribution of income have been clearly felt by society. Another effect of high inflation, which manifested itself in the short-term in society, is that of immoral behavior. High inflation led to moral corruption in our country. While Turkey ranked low in fields such as infrastructure, education, health and the fair distribution of income in international development indicators, it ranked high in indices of corruption. Another factor worth mentioning in this context is the relationship between high inflation and political instability. Shortsighted policies by political instability and the resulting inflation as a result have  BIS Review 36/2005  1  featured several times in economic literature.
Some of those who stop trading when markets are unsettled would probably not do so if they had a known and safe counterparty with whom to trade in a properly transparent market. Conditions are then in place for arranging securities transactions in ways that are safe and efficient, so that financial stability can be more satisfactory. The fixed-income market I shall now say something about the fixed-income market. The fixed-income market in Sweden differs from its larger counterparts in Europe. There are considerably fewer participants and the market is shallower – less liquid. This presumably entails higher costs  8  4  This refers to the derivatives that are not traded on exchanges, for instance swaps, futures and options. BIS Review 153/2008  for transactions of a given size, as well as closer relationships between the players. These circumstances are liable to affect how the market functions, particularly in times of unrest. The risk propensity falls and with relatively few participants, market liquidity is easily eroded. Trading in the Swedish bond and money market is still done mainly by telephone, over-thecounter, though some electronic trading has existed since 2001. This electronic trading is in three benchmark bonds. To work properly, electronic trading needs products that are highly standardised, as well as relatively high liquidity. In Europe, electronic trading is used for roughly 75 per cent of all transactions but they account for only about 50 per cent of the volume. Large orders are still traded by telephone.

The ECB has had to use different instruments at different stages of the crisis. Now the economic and financial situation in Europe is significantly better. Financial fragmentation has receded, Member States have made significant efforts towards economic convergence and the governance of the euro area has been strengthened. We are gradually moving out of the  BIS central bankers’ speeches  1  crisis phase into a different environment, with the focus shifting from solving the crisis to ensuring stable economic growth and inflation close to 2%. It requires a different approach and different instruments. The developments beyond our eastern border are the big topic of debate in Poland at the moment. Could the conflict between Russia and the Ukraine affect Europe and its economy in any way? The impact on trade or the financial system has thus far been limited. But this situation does give rise to uncertainty, so it can be regarded as a potential negative factor that could hinder economic growth in Europe, and that is part of our risk assessment. What about the strong euro? Aren’t you worried it could cause problems for European exporters and hinder the recovery? The ECB doesn’t target the exchange rate. Our primary mandate is price stability, and within this mandate, the exchange rate of the euro is among the factors determining the level of inflation. And indeed, the strong euro is contributing to the current low inflation.