samchain/econo-pairs-v1 huggingface dataset:
Ardian Fullani: Development of the interbank market in Albania and the Bank of Albania Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the Forum “Interbank Market Development and Improvement of Operational Policy at the Bank of Albania”, Tirana, 21 June 2010. *  *  *  Dear bank managers, Dear colleagues, We are gathered here today to discuss an essential issue concerning the performance of our financial market and the Albanian economy on the whole: interbank market development and strengthening. I do believe that the role and importance of the interbank market is clear to all attendees. It represents the first link of liquidity trading in economy and the most transparent price setting mechanism. By providing the appropriate instruments and partners for liquidity trading, the interbank market allows the refinancing of short and medium-term positions and facilitates the mitigation of your business’ liquidity risk. The banking system and the interbank market represent the exclusive setting monetary policy operates in. A developed, active and efficient interbank market enhances the efficiency of central bank’s monetary policy, transmitting its impulses into the economy best. Thus, the development of the interbank market smoothes the progress of financial intermediation and boosts lending to economy, hence improving the country’s economic and social welfare. The deepening and broadening of the financial market is one of the key structural reforms in economy. It should be ceaseless and it requires the commitment of domestic and external factors.

It naturally adapts to the different economic development stages the country and the state go through. I do believe there cannot be a developed and well-integrated economy without open, integrated, efficient, transparent and well-regulated markets. Therefore, it comes out clearly that the development of the interbank market is in all stakeholders’ interests: the banking system itself, the Bank of Albania and the economy on the whole. Being fully aware of this, the Bank of Albania has built a clear strategy in terms of: 1. Deepening and broadening the money market in Albania further;  2. Creating relevant market instruments;  3. Establishing a close and rational cooperation with the banking system and the financial market in general;  4. Ensuring a clear and constant communication with the market operators and the public at large;  5. Providing modern technological solution. As a result of these initiatives, our monetary policy is now entirely based on indirect instruments of monetary management, which operate in line with the open market logic. Our operational framework allows the banking system to manage the liquidity effectively, being a counterparty of the last resort to meet the system’s aggregate needs for liquidity or invest it. Via the required reserve, the Bank of Albania has provided you with enough room to cover your unexpected liquidity needs, at a remuneration rate close to the market interest rates that  BIS Review 97/2010  1  avoid the distortions the required reserve may yield to your banking business.
See ‘Lambda’, speech by Mark Carney at the London School of Economics, 16 January 2017. 16 Each observation shows the central projection for spare capacity or excess demand at the end of the second year of the forecast period (the 'Year 2' point) on the horizontal axis against the central projection for four-quarter CPI inflation at Year 2 on the vertical axis from successive Inflation Reports. The left-most observation (labelled "Aug. 2016 no stimulus") is a counterfactual version of the August 2016 Inflation Report forecasts with the effect of the MPC's Bank Rate cut, Term Funding Scheme and Asset Purchases removed. See ’Lambda’, speech by Mark Carney at the London School of Economics, 16h January 2017, for further details and discussion. 17 See Table 4.C in the May 2018 Inflation Report, available at www.bankofengland.co.uk/inflation-report/2018/may-2018. 12  All speeches are available online at www.bankofengland.co.uk/speeches  12  Chart 7: Trade-off in successive Inflation Report projections at Year 3 3.0  Inflation (%)  August 2016 2.5  November 2016  February 2017 August 2017  May 2017 November 2017 February 2018  2.0 -1.0  August 2016, no stimulus  -0.5  May 2018  Excess demand (%)  0.5  1.0  0.0  Preferred trade-off if λ=0.1  1.5  Preferred trade-off if λ=1 1.0 A Guidance Stocktake As the UK enters the most critical phase of the Brexit negotiations, it is useful to take stock of forward guidance and its potential role during the upcoming period.

The depreciated exchange rate has stimulated the traded goods sector. The manufacture of consumer and capital goods has a relatively low weight in the Icelandic economy, but the demand for these was hit disproportionally during the postLehman economic confidence crisis in the second half of 2008 and first half of 2009. Finally, although the destruction of wealth that Iceland has experienced as a result of the collapse of the Icelandic banks is enormous, it is not proportionate to the size of the banks, as foreign creditors will lose much more. Let us now turn our attention from the macroeconomic part and explore further the story of Iceland’s cross-border banks, which to my mind holds important lessons for cross-border banking more generally, both from the standpoint of the small economy and at the European and global levels. In the rest of my remarks, I will first give you a short overview of how the Icelandic banks failed. I will proceed to explain the build-up of these cross-border banks and the associated vulnerabilities. I will then return to the collapse of the banking system by discussing crisis management and resolution before turning to some of the causes. Finally, I will reflect on the lessons learnt and some of the issues that remain unresolved. How did the banks fail? Iceland’s three cross-border banks all failed and were placed in special resolution regimes during the first full week of October 2008.
Later on, this increase in Asia’s net saving combined with significant terms of trade gains (figure 2). Thus, there was a large amount of funds looking for a place to invest. The United States had the capacity to produce profitable securities to absorb said savings (Caballero et al., 2008). A different version of this story was that the deficit was simply mis-measured, owing to its many non-observable components, which led analysts to mistake foreign funding for foreign income (Hausmann & Sturzenegger, 2006). This is the case, for example, of seniorage. Both stories help explain why the current-account deficit can persist in high levels for longer than usual. But domestic factors also played a part in the US. expansionary monetary and fiscal policies while a real-estate bubble was building up, put additional weight on the fall in savings. The main question was if this process could be sustained, and the more benign visions thought it could last a long time. But the accumulation of imbalances at least had to moderate, which indicated that the dollar would weaken and output would slow down. Calculations performed a few years back indicate that a dollar depreciation of around 40% was necessary to reduce the current-account deficit by 3 percentage points of GDP. 2 According to estimates by Freund and Warnock (2007), such an adjustment would cause a GDP slowdown of around half a percentage point, much less than a financial crisis.

But not only have we learned from past errors, like the need to have good economic policies; the world is also better. The progress of the past few decades in technology, flexibility, international integration, transparency and accountability, among other factors, make this world a safer place. In Chile we have a policy framework that grants us a good position like no other before, to sail through troubled waters. Regarding the world economy, there are big risks. The Chilean inflationary problem stems from international price rises, although recently we have seen the harmful effects of propagation. In the baseline scenario, the world will post strong growth in coming years, driven to a large extent by emerging economies, particularly China and India. One cannot rule out a deeper and longer lasting slowdown of industrialized countries than assumed in the baseline projection. In a weaker economic scenario, commodity prices should decline. A drop in the oil price would come as a relief for the world economy. Also, a weaker world economy could affect Chile’s GDP growth directly. These forces would pull down inflation. However, the inflationary dynamics and the convergence of inflation to the target cannot be based on a weak world scenario. This is a possibility and, as we always do, we will act with sufficient flexibility and realism to incorporate international developments and prospects in the analysis that underlies our monetary policy decisions. In these moments, inflation risks and dynamics do not allow for excessive optimism.
According to, for instance, Dagens Nyheter newspaper’s editorial pages, the policy was instead “an interest-rate increasing experiment”, based on the Riksbank governors spreading “misleading pictures of the future”.10 The only explanation I can think of for this claim nevertheless being repeated and referred to so often and so uncritically, is that people simply assume that it must be true because it has been expressed with such emphasis and intensity. A hazardous policy But claiming that it has all been about leaning against the wind is not only a misleading description of the policy conducted and the motives behind it. There is also good reason to wonder whether a policy whereby the repo rate had remained unchanged since the crisis might not have been rather risky, regardless of what one claims it would have represented. According to the counterfactual analysis, there were only gains and no problems: inflation would have been close to the target and employment would have been higher if the repo rate had not been raised. But I also believe that there would have been a major risk of other, less pleasant things happening that is disregarded in the analysis, consciously or unconsciously. 8  See, for instance, Visco (2014): “An actual example of the debate on the macro-prudential use of the policy rate relates to the tightening of monetary policy by the Sveriges Riksbank that began in July 2010 and peaked in July 2011.

Further development of the inter-bank market was another important component of the project, given its significance in enhancing the monetary policy transmission mechanism to the economy. The supervision philosophy started to change in January 2010 with the establishment of a new dynamic structure oriented towards risk identification and management. Therefore, in addition to human resources capacity building for its eventual application, best European standards had to be identified and acquired in detail. The precious experience of the Bank of Italy, one of the most prestigious institutions in Europe, helped the Albanian supervision process conform to the best European models. I would like now to highlight several key developments: First, we have migrated from the actual CAMELS evaluation system towards another evaluation model based on a wider spectrum of individual risks, as envisaged in Basel II and Basel III standards. That was the most intensive process of this project, which required maximum engagement of Bank of Albania’s experts throughout these 18 months. Eventually, we produced a new supervision manual with European principles and methodology, broken down by risks and individual evaluation systems. Bank evaluation improved as qualitative criteria were taken into account in addition to quantitative data. Second, the Regulation “On capital adequacy ratio” has been revised in accordance with the BASEL II and Capital Adequacy Directive. The revision is followed by introduction of the standard method for credit and market risks and the simple and standard method for operational risk. Given its significance, the draft-text of the Regulation is being consulted with the banking industry.
Since then, differentials have narrowed again somewhat due to a more pronounced decline in the US. The yield on ten-year Confederation bonds last stood at –0.15%, virtually unchanged versus midyear. Let me now turn to the foreign exchange markets. Compared to the turbulent developments on the equity markets, the currencies of the major advanced economies traded within fairly narrow ranges in the second half of the year. On a trade-weighted basis, the US dollar has gained 2.5% since mid-year thanks to a buoyant economy and rising interest rates. The tradeweighted euro, however, lost almost 1% over the same period due to weaker economic momentum in the euro area recently and uncertainty linked to Italy’s budget issues. The Swiss franc remains vulnerable to changes in risk sentiment on the international financial markets. It strengthened moderately, by 2.5%, in the second half of the year (cf. chart 4). This appreciation is primarily due to the period between August and mid-September, when concerns about emerging markets – and possible consequences for Europe’s finance sector – caused a renewed spike in risk premia on European financial securities. From mid-September, the Swiss franc depreciated again slightly, particularly against the US dollar which has become more attractive to investors due to the greater interest rate advantage. Furthermore, emerging market currencies stabilised noticeably. Overall, developments on the foreign exchange markets show that the situation remains fragile and that the Swiss franc continues to serve as a safe haven in times of heightened uncertainty.

News conference  Berne, 13 December 2018 Andréa M. Maechler  Introductory remarks by Andréa M. Maechler  I will begin with a review of developments on the financial markets and look at the status of the Swiss franc. After that I will say a few words about the upcoming transition from Libor to SARON as the new reference interest rate in Switzerland and inform you about progress being made on this front. Situation on the financial markets  So let me start with developments on the financial markets. In the second half of the year, sentiment on the financial markets darkened considerably at times, despite the fact that the economic situation in many countries remained sound. Nonetheless, the economic data did weaken slightly in some regions. This caused investors to focus on a number of risks – most notably, ongoing concerns about protectionist tendencies, but also the currency crises unfolding in several emerging economies and Italy’s budget dispute with the EU. As a result, volatility on the financial markets has increased significantly since mid-year (cf. chart 1). This is particularly true of the equity markets, where prices fluctuated substantially at certain points. Thanks to strong economic data and solid corporate earnings growth, US stock exchanges performed better than their counterparts in Europe and the emerging markets (cf. chart 2). Despite suffering sizeable losses in October, the S&P 500 recently closed only moderately lower than it had at the end of June down 3%.
François Villeroy de Galhau: The euro area - staying the course through uncertainties Introductory remarks by Mr François Villeroy de Galhau, Governor of the Bank of France, at the Bank of France Symposium & 34th SUERF Colloquium on the occasion of the 20th anniversary of the euro, Paris, 28 March 2019. * * * Good afternoon everyone and welcome to Paris. This is not only the 34th SUERF Colloquium but also the 10th Banque de France International Symposium. It is also Marc-Olivier’s last symposium and I would like to warmly thank him and the teams at SUERF and the Banque de France for their hard work. I also wish to express my gratitude to the speakers and moderators as key players in “staying the course through uncertainties”. In my opening remarks I will modestly describe different types of uncertainty before discussing their possible implications for policy. ** 1 – There are actually four different types of uncertainty We often talk about uncertainty as if it is a single phenomenon. There are, however, multiple sources and forms of uncertainty that have different implications for how policy makers can and should respond. To introduce your discussions over the next two days, I will mention four of them. First, “Current state” uncertainty One form of uncertainty that we grapple with all the time is not being completely sure where we are economically.

Furthermore, differences in demographic trends and structural policy choices between countries in the eurozone (or states in the US) may create or perpetuate some heterogeneity across large monetary areas, an issue you will discuss tomorrow morning. 2 – How to respond to such uncertainties? Without pre-empting discussions, let me flag some possible responses. I’ll first, address the issue of policy uncertainty between central bankers. So far, it is, fortunately, the simplest one: we are not in a so-called “game of chicken” and clarity about policy intentions between ourselves are beneficial for all. The frequent exchanges we have at the BIS, G7, G20 and even events such as this Symposium, are valuable to create mutual trust and avoid the possibility of large policy surprises. Our monetary policies are independent, and rightly so, but they are concerted and we are committed to avoid currency wars. Clarity about our reaction functions clearly also extends to financial markets and the public at large. Second, how could we respond to current state and future path uncertainty? The textbook answer, dating back to Theil and Tinbergen, is to work out your best guess and then act as if you are completely sure. This is sometimes described as the certainty-equivalent approach. There are, however, symmetry assumptions in this type of model that do not necessary hold in the real world. Uncertainty around the central projection may be skewed in one direction. Applying the certainty-equivalence approach also assumes that upside errors are regarded equally to downside errors.
Our financial education programmes, informative publications on banking products and services, coupled with regulation, licencing, introduction and support for new payment and financial services technology and instruments, are aimed at enhancing financial inclusion and generating opportunities for financial access for all groups of the society. The Bank of Albania deems that more may be done with regard to designing and promoting financial products that satisfy better the needs of such groups. In addition, we think that there is more space for faster growth of credit to the private sector, particularly for certain sectors, in which inequality is more notable. More concretely, agriculture is a good example to illustrate this point. While it contributes a significant share to the gross national product, it only gets a small share of credit and other financial products. Beyond these policies and strategies for developing financial products, the real fight against poverty and inequality in the long term should be based on accomplishing structural economic, legal and institutional reforms, designed in the framework of the European integration process. The priorities of our economies should focus on maintaining macroeconomic and financial stability, continuing structural reforms in infrastructure and the labour market. Creating favourable conditions for doing business and for honest investors, by fighting informality, should be accompanied with the creation of human capital and preparation of the workforce in accordance with the actual technological developments and challenges. Dear participants, The Transition Report 2016–2017 of the European Bank for Reconstruction and Development is an important document for all of us.

All VSEs will be welcome, including, of course, those whose business is expanding and who need information tailored to their size. The Banque de France shall guarantee complete privacy in these dealings – indeed this is one of its fundamental values and skills: VSEs will have the peace of mind of knowing that, if they so wish, all discussions will be fully confidential. The VSE Correspondents will be appointed in the spring of 2016 and, after a period of specific training, will be fully operational by the autumn. Also in the autumn of 2016, the Banque de France will provide firms with access to an online analysis and simulation tool called OPALE, which enables companies to assess their finances while also learning more about the subject. 1  Evaluation de la mise en oeuvre des 5 mesures prises par la FBF pour améliorer les relations banquesTPE/PME, report submitted on 25 November 2015. BIS central bankers’ speeches  3  3) I’d like to turn now to my last suggested focus for action, which I believe is also extremely important: reducing the amount of time it takes for business customers to settle their invoices. Again it is difficult to provide accurate measurements – and at the Banque de France we are well aware of this as we have been helping to look into the issue for several years.