samchain/econo-pairs-v1 huggingface dataset:
All of this tells me that Bronx households have a considerable way to go before they reach more comfortable debt levels. Conclusion To sum up, over the first half of 2011, the slowing of economic growth in the nation and the weak labor market has been a major disappointment. Recently, growth has picked up modestly, but not enough to reduce unemployment. Despite some bright spots in the U.S. economy, strong headwinds are preventing a more vigorous recovery. Inflation, which has risen in recent months, is poised to slow soon. The Fed is doing – and will continue to do – everything within its power to promote jobs and price stability. 2  See, for additional discussion of this topic, William Dudley. 2011. “Job Creation in the Region”. Remarks at the Quarterly Regional Economic Press Briefing, New York City. August 12. 3  Quarterly Report on Household Debt and Credit, August 2011. BIS central bankers’ speeches  5  High poverty, unemployment and delinquency rates suggest that the Bronx faces a number of challenges. However, the continued job growth in the Bronx and rest of the city should create more opportunities for Bronx residents to improve their incomes and personal finances. Going forward, the key challenge for the Bronx will be to prepare its residents for the best jobs being created in the region. The Bronx must strive to build the human capital – that is, education and skills – of its workforce. A region’s human capital determines a large part of its economic success.

As of August, the 12-month change for a broad measure of consumer prices was 2.9 percent, almost double the change in the year before. However, the bulk of that increase was due directly to the run-up of energy and commodity prices, which tend to bounce around a lot. Measures of the underlying rate of inflation have moved up too, but by less and to levels broadly consistent with price stability. I expect those to subside soon, as well. It is important to remember that a year ago the worry was that deflation – meaning a persistent, widespread decline in prices – might take hold. Deflation tends to inhibit growth because people and companies have a harder time paying down debt and may defer investments and purchases when prices and wages are falling. Avoiding outright deflation is a very good thing. BIS central bankers’ speeches  3  Thus, barring more energy price jumps, I expect inflation to fall late this year and next. Moreover – and this is crucial – households’ inflation expectations remain well anchored. Low and stable inflation expectations help us to deliver low and stable inflation. In light of the current weak outlook, the FOMC has announced that we expect to keep shortterm interest rates exceptionally low at least through mid-2013 and will change the composition of the assets the Fed holds to provide additional support for growth. In addition, we have discussed the range of policy tools available to promote a stronger economic recovery even as we keep inflation pressures in check.
Thus, how much one pushes on the short-term interest rate lever depends, in part, on how financial market conditions respond to such adjustments. Imagine driving a car where the connection between the gas pedal and the engine speed was variable and uncertain. The driver would have to constantly monitor and adjust the pressure on the gas pedal to achieve the desired speed. Similarly, we will have to monitor and adjust short-term interest rates to achieve financial market conditions consistent with achieving our labor market and inflation objectives. All else equal, less responsiveness implies larger interest rate adjustments and vice versa. Quickly, let me give two examples that illustrate how variable this linkage can be. First, during the 2004–07 period, the FOMC tightened monetary policy nearly continuously, raising the federal funds rate from 1 percent to 5.25 percent in 17 steps. However, during this period, 10-year Treasury note yields did not rise much, credit spreads generally narrowed and U.S. equity price indices moved higher. Moreover, the availability of mortgage credit eased, rather than tightened. As a result, financial market conditions did not tighten. As a result, financial conditions remained quite loose, despite the large increase in the federal funds rate. With the benefit of hindsight, it seems that either monetary policy should have been tightened more aggressively or macroprudential measures should have been implemented in order to tighten credit conditions in the overheated housing sector.

Although that could change depending on how the economy evolves, my views on “when” do not differ appreciably from the most recent primary dealer and buy-side surveys undertaken by the New York Fed prior to the October FOMC meeting.3 I hope the economic outlook evolves so that it will be appropriate to begin to raise interest rates sometime next year. While raising interest rates is often portrayed as a difficult task for central bankers, in fact, given the events since the onset of the financial crisis, it would be a development to be truly excited about. When the FOMC begins to raise its federal funds rate target, this would indicate that the U.S. economy is finally getting healthier, and that the Committee believes it is on a sustainable track to achieving its dual mandate objectives of maximum employment and price stability. That would be very good news, even if it were to cause a bump or two in financial markets. So, when the appropriate time comes, how is the process of monetary policy normalization likely to unfold? In this regard, the revised policy normalization principles and plans that the FOMC released following the September FOMC meeting are informative.4 In particular, the Committee will begin to normalize monetary policy by first raising its target range for the federal funds rate and short-term interest rates will be the primary tool used for tightening monetary policy.
This means we can keep inflation in check regardless the size of our balance sheet. If the recovery got underway in earnest and credit demand surged, we could slow down the rate of credit creation by raising the interest rate we pay on excess reserves. Banks wouldn’t lend out funds at lower rates than what they can earn from holding reserves with us. As a result, a hike in the IOER would raise the level of interest rates throughout the economy and this would dampen any expansion of credit. Our ability to pay interest on excess reserves is an essential tool that we can use to avoid future inflation problems.4  4  In technical terms, we will be operating a floor-based system for implementing monetary policy rather than the traditional corridor-based system for a period. 6  BIS central bankers’ speeches  We are mindful of the fact that there could still be confusion about how exit will take place. This could increase financial market volatility. To reduce this risk, the FOMC has published a set of exit principles. These principles lay out a roadmap about how exit is likely to occur: First, the end of reinvestment of maturing securities; second, an increase in short-term interest rates, and, third, the gradual sale of mortgage backed securities to shrink the magnitude of excess reserves in the system and ultimately to restore the Fed’s balance sheet to a predominately all-Treasury portfolio.

By now, all major financial institutions should have identified what needs to be done and be in, or near, the final stages of developing detailed plans. Work on changing all applications identified as high business priorities also should be well under way. In the United States, most large institutions plan to have their major applications available for external testing around the middle of 1998, with an expectation that testing with other major institutions would largely be completed by year-end 1998. This schedule allows all of 1999 for end-to-end testing on an industry-wide basis. But even with two years to spare, it is safe to say that no organization will be able to cope successfully with the Year 2000 challenge unless both its management and staff realistically measure its scope and commit to its solution. Bluntly stated, if your own management and staff, or your correspondents and customers, take any of the following positions, your organization may be at risk: • Denial -- the Year 2000 is not an issue for our organization. It is. • No resource problems -- our organization can handle the Year 2000 with its existing resources and within current information technology budgets. Very unlikely. BIS Review 87/1997  -4-  • Vendors will address the issue -- our outside vendors and service providers won’t let us down. Trust is not a substitute for testing. • Covered by contract -- our lawyers have determined that we are appropriately protected by our legal agreements.
Despite a huge increase in the volume of central bank reporting, neither understanding of, nor trust in, central banks has improved. These trust and understanding problems are not unique to central banks – they are common across banks, business, government, the media. Nonetheless, what explains these trends? The financial crisis and the slow recovery from it are likely to have been one factor, but not the whole story. Let me highlight three other factors to have played a role, for central banks and more broadly. (a) The changing nature of trust  Trust has been studied extensively by philosophers, sociologists and anthropologists over many years. 49  These studies have shown that trust can take a variety of forms and can change shape quite fundamentally over time. Such a mini-metamorphosis appears to have taken place over recent years, in particular among trust in institutions. 50  The traditional model of trust was a fairly simple one. To a significant degree, it was anonymous, centralised and institutional. The actions of institutions, like the Fed and the Bank, were trusted by the general public, even when few of them understood what it is these institutions did and why. And having a trusted third-party, able to exercise a degree of control over monetary and financial affairs, was a source of comfort. This institutional structure, in the main, served society well. Not least, it lasted for several hundreds of years. Some have argued that a good chunk of society’s success over this period can be attributed to these institutional foundations.

It is made convenient for worldwide usage as it is an internet based platform – the first of its kind in the world with crude palm oil (CPO) as its underlying base commodity. Although Malaysia already has a well functioning and efficient Islamic inter-bank market, the CMH provides a further viable alternative using the commodity murabahah concept. While the CMH will provide another alternative to the already robust liquidity management infrastructure in Malaysia, it will also enable liquidity management in the global financial system. The CMH has a vast potential to facilitate liquidity flows from one financial centre to  BIS Review 98/2009  1  the other. The increased efficiency in the liquidity management across countries will also contribute towards sustaining overall stability of the Islamic financial services industry at the international level. In addition to enhancing liquidity management, the CMH will provide an environment for increased innovation in the Islamic financial industry whereby the financial institutions will be able to provide a wider range of new financial instruments including deposit, financing, investments and hedging. To evolve Malaysia into an international Islamic financial hub, Malaysia has under the MIFC initiative, put in place a facilitative framework for both ringgit and foreign currency denominated sukuk issuance. The recent issuance of the US dollar 1.5 billion 5-year Petronas Emas Global Sukuk on 12th August marks a new beginning for the foreign currency sukuk market in Malaysia.
Total new lending to households in 2021 amounted to € which is higher than the € credit that was granted during the pre-pandemic year of 2019 and well above the € granted during 2020. The momentum has been maintained in the first two months of 2022 as well, since the new lines of credit amounted to € against € last year. Total new lending to businesses in 2021 accumulated to € which is higher than the € granted in 2020 but subdued when compared with the € granted in 2019. It is evident that the banks' financial position, the regulatory measures and initiatives taken by both the European Central Bank and Central Bank of Cyprus are the factors that contributed to this positive post-Covid development of the banking sector providing support to the economy. However, banks must, for their own good and profitability as well as for the good of the Cypriot economy, become better and more efficient at serving their clients. I have made this point to the CEO's and Chairmen of the banks a number of times and I also called a meeting between the CBC, economy stakeholders like KEBE, Institute of Certified Public Accountants of Cyprus, the Cyprus Bar Association and the Cyprus banks to promote and facilitate better and more efficient ways of doing business with the banking sector. Whereas as agreed, follow-on meetings have subsequently taken place  3/5  BIS - Central bankers' speeches  between the stakeholders, I'm forced to say that I have not seen practical progress.

Constantinos Herodotou: Central Bank Challenges in a world of growing uncertainties - the conduct of monetary policy and the evolution of traditional banking Speech by Mr Constantinos Herodotou, Governor of the Central Bank of Cyprus, at the ICPAC Mediterranean Finance Summit, Limassol, 5 May 2022. *** Dear guests, dear co-speakers, it is a pleasure to have the opportunity to speak to you here today. These days our thoughts are with those affected by the tragic events of the Russian invasion in Ukraine. Beyond the human loss, Russia's war against Ukraine has disrupted further the global supply chains and in effect growth and inflation patterns around the world and the euro area economy. Europe faces both supply disruptions and surging prices for commodities and raw materials, problems exacerbated by the region's dependency on Russian oil and gas. How the euro area economy performs will greatly depend on the magnitude and time length of the conflict, the side effects of current sanctions on the euro area and on possible further measures. I will first describe the current economic developments in the euro area as regards growth and inflation outlook and the ECB's monetary policy stance and challenges under the prevailing uncertain geopolitical situation. As the supply disruptions from the acute phase of the pandemic were easing, the war and the consequent sanctions imposed on Russia are causing a new negative shock that is weakening the pace of the post pandemic recovery, creating new supply-side bottlenecks and increasing inflationary pressures for longer.
For the purpose of self-fortification, the small open markets need to make greater efforts to strengthen domestic monetary and financial systems. They may need to do so to such an extent as to go beyond established practices and standards of the large developed markets, simply because there is greater risk for them than for the larger markets of being overwhelmed by international capital. This approach will involve costs, and this should be recognised and accepted. First, it may require substantial resources - witness the enlargement of the monetary base in Hong Kong to build a big cushion to absorb the impact of volatile short-term capital flows and to reduce the sensitivity of interest rates to those flows. This involved committing over $ billion of our foreign reserves as a shock absorber. We can afford this, but this may not be the case for other small open markets. Second, it may also involve the regulators playing a more proactive role in market development, anticipating and pre-empting systemic problems. This is very much the background to the banking reforms now in train, to the public discussions about consolidation of the banking sector, and also to the merger of the exchanges. Third, it certainly requires a much higher degree of cooperation and coordination among different domestic regulators, and for each to take into account the wider cross-market issues that have a bearing on systemic stability.

Once the joint banking supervision facility in the euro area has been established, the idea is that the ESM will take over from the EFSF and the loan can be channelled directly to the Spanish banks. This will break the links between the crisis banks’ finances and the Spanish government’s finances. The European Commission has signalled that a proposal regarding banking supervision will be announced in early September. One condition for the ESM to be able to take over the loan is, of course, that the mechanism is actually activated. This requires approval from countries that together account for 90 per cent of the capital paid into the mechanism. At present, approval is yet  BIS central bankers’ speeches  3  to be given by Germany – which is awaiting a verdict from its constitutional court in mid-September. The Memorandum of Understanding regarding support to the Spanish banks makes it clear that the Spanish government is expected to carry on with its work on reducing its budget deficit to just below 3 per cent. The time limit they have been given to reach this has been extended by one year to 2014. Spain has given an account of its budget plans and the savings to be implemented to reach the target. During the summer the IMF has also given strong support to Spain’s efforts. Concern over the situation in Spain and Italy The market’s reactions to the agreement on banking support to Spain can be described as cautiously positive.
Historically, attempts to use monetary policy to affect the average level of real variables such as employment and unemployment have led to serious mistakes and high inflation. In the case of the real economy, monetary policy can only affect, and to a certain extent dampen, fluctuations in real variables around their average levels. For monetary policy, it is thus meaningful to select a certain target for average inflation, but it is not meaningful and in fact counterproductive to select a certain target for average production or employment, other than the normal level that is determined by the workings of the economy and factors other than monetary policy. With a flexible inflation targeting regime, the central bank then has to set a policy rate and choose a policy rate path that make the forecast for inflation and resource utilisation together "look good". By a forecast that looks good I mean a forecast in which inflation is on target and resource utilisation is normal, or in which inflation is approaching the target and resource utilisation is approaching a normal level at an appropriate pace. To be more precise, it means a forecast for inflation and resource utilisation that as effectively as possible stabilises inflation around the inflation target and resource utilisation around its normal level and, in the event of conflicting objectives, achieves a reasonable compromise between inflation stability and resource utilisation. Different central banks express this in slightly different ways. The Riksbank has often used the term "a well-balanced monetary policy".

One way of evaluating how effectively the central bank implements monetary policy is therefore to simply investigate how well the market participants have predicted the changes in the central bank's interest rate path. We can also analyse how well the expectations regarding the future interest rate adapt to the central bank's new interest rate path after the announcement. 10 Figures 11 and 12 are examples of the type of figure that can be studied in this case. These relate to the first interest rate decision I was involved in making, in June 2007, and to the latest decision from February this year. Summary Let me now sum up by first returning to the question I raised at the start: when evaluating monetary policy with an inflation target, why is it not enough to simply compare outcomes and targets for inflation? One reason is that inflation reacts with varying time lags and to different degrees to monetary policy measures. Inflation is also affected by shocks that are difficult to identify or that occur at a later date. The central bank does not therefore have complete control over inflation. Inflation can be on target even if the central bank has acted wrongly but been lucky, or deviate from the target even if the central bank has acted correctly but been unlucky. Another reason is that the Riksbank and other central banks with inflation targets conduct flexible inflation targeting, which means that they strive to both stabilise inflation around the inflation target and to stabilise the real economy.
Our long historical ties, going back to the 2nd century B.C., are an asset. Singapore’s Arab lineages run through our veins. But to build bridges between our peoples in the 21st century, we have to not only look back to our historical ties and roots, or rekindle and reinvigorate our ties in trade. We have to work with our young. Our young today grow up knowing very little of each  BIS Review 47/2005  3  other. We have to give them opportunities to meet, to find resonance in each other, and to strike up friendships. If we do this when our people are young, we build up trust for the future. And trust is what makes economic and business relationships last. Singapore, Kuala Lumpur and other Asian cities can play a growing role in this regard. For some years now, we have been creating what we call a “global schoolhouse” here in Singapore. Today, Singapore has some 66,000 international students pursuing different levels of education. At the university level, we have today some 16 of the best global institutions providing programmes in diverse areas. Top business schools such as INSEAD and University of Chicago have established their own campuses in Singapore. At our Singapore universities, there is already a small Middle Eastern presence, with 10 undergraduate and 16 postgraduate students from Middle Eastern countries (including Turkey, Jordan and the UAE).

To go back to my earlier imperfect metaphor, we want to test whether the track and the cars can cope with an unlikely but plausible combination of adverse circumstances. And you will note that a major part of the adverse scenario is a rise in unemployment and a crash in house prices. We want particularly to test this because housing mortgage debt is around two-thirds of UK banks’ domestic lending. And this brings me onto my second example. Last week, the Financial Policy Committee announced two important measures to address the risk that continued momentum in the housing market could pose to household indebtedness and thence to the economy and to financial stability. I think it is important to understand why the FPC is concerned about the housing market: what we are and are not responsible for and what we can and cannot do. We cannot address  4  BIS central bankers’ speeches  the imbalance between the supply and demand for houses in the UK. The Bank cannot build a single house. Nor should we take responsibility for house prices. It is the risks to financial stability and to the economy we must focus on. The main risk we see arising from the housing market is the risk that house prices continue to grow strongly and faster than earnings and – and this is an important “and” – this increase in prices leads to higher and more concentrated household indebtedness.