samchain/econo-pairs-v1 huggingface dataset:
4  BIS central bankers’ speeches  non-constant parameters allow the identification of a range of values that quantify the cost in terms of growth failure for every two percentage point increase in steady-state inflation. This cost implies lower growth of between 3 and 5 percentage points over a period of ten years. Finally, monetary policy is a powerful tool. When used improperly, it may cause permanent damage. But it can become an effective, stabilising factor and contribute to collective prosperity in an independent and active way. The sine qua non for this is to build monetary policy decisions into a systematic and predictable strategy, based on price stability, which drives expectations and guides the economy but doesn’t shock it. This is perhaps the most important practical difference to what was studied in the early 1970s. The ECB’s monetary policy strategy  The ECB’s monetary policy strategy is based on the new theory of the instruments I have tried to outline, and takes into account the enrichment of the theory of objectives, which emphasises the contributions of price stability to the “general prosperity”. It also provides continuity for a monetary tradition in continental Europe that has ensured inflation-free growth for more than 60 years. The strategy is based on the objective of “maintaining price stability” that the Treaty has entrusted to the central bank and the quantitative definition that the Governing Council subsequently gave the objective.

The studies I have mentioned helped to define a range within which inflation is no longer a factor that distorts economic choices. The ECB pursues, as an objective of monetary stability in the medium term, an inflation rate below, but close to, 2%, which is the upper limit of this range. The macroeconomic model on which the ECB’s monetary policy strategy rests is imbued with contemporary macroeconomics, based on dynamic optimisation and on the centrality of forward-looking expectations.5 At the same time, the model is broader and well structured and corrects the simplifications of the pre-crisis neo-Keynesian paradigm with its prescriptive approach to optimal monetary policy. The weakness of this paradigm was, and is, its inability to recognise the importance of financial frictions and the role of credit and money. This has to do with the fragility of the theoretical foundations that formalise the links between the real economy, financial imbalances and the level of confidence. Ignoring money is tantamount to assuming an absence of risk and uncertainty. Without risk, Keynes would have said, there would be no money. The preference for liquidity is not justified in an economy without uncertainty. But the neo-Keynesian model excludes the possibility of default. In it, risks in the financial sector can be isolated and therefore have no effect on the real economy. The financial crisis has clearly highlighted the weaknesses of this system. Macroeconomic theory has begun to reflect on the neo-Keynesian system and these studies are now one of the liveliest areas of analysis.
An important objective of such regulatory convergence is to ensure that crossborder financial linkages act to foster regional growth, while mitigating the propagation of systemic risk across borders through such linkages. The convergence of standards has proceeded in different ways in different parts of the world. In Europe, regulatory convergence has been driven by EU-level bodies and agencies, including the European System of Financial Supervisors and the European Systemic Risk Board. The EU-wide prudential rules are formulated and implemented through directives and regulations legislated by the European Parliament and European Council, with limited room for member states to apply “national discretion”. Recent proposals to establish a single supervisory mechanism for banks led by the European Central Bank, and a single resolution mechanism, will further  2  BIS central bankers’ speeches  reinforce the role of EU-level institutions in the management of financial stability in the Euro area. With significantly more diverse economies and financial systems, promoting greater regulatory convergence in Asia is more likely to proceed on the basis of a set of shared principles for developing and maintaining sound financial systems, while providing for the unique and distinct legal, financial, social and economic structures of individual countries within the region. It will be important to have clarity around the key principles, an inclusive process in agreeing on these principles, and mechanisms that support their effective implementation in individual countries.

The Journal can have a significant influence in drawing attention to the financial stability issues that are most important and thus contribute towards the thinking and responses on these issues. It is a process that should have an inclusive participation in this important agenda of financial stability. BIS central bankers’ speeches  3
The first two post-war decades, for example, when inflation was low, were considerably more stable than the 1970s and 1980s, when inflation was left to rise and there was a series of devaluations, with negative effects on productivity and growth. Moreover, the higher the rate of inflation, the more likely it is that the rate will fluctuate, which accentuates the uncertainty about future inflation. Savers and creditors then require higher compensation for risk: besides compensation for the expected rate of inflation, they will demand a premium for the degree of uncertainty about future inflation. This means higher real interest rates, which weaken the propensity to invest. Furthermore, the more inflation fluctuates and is difficult to forecast, the greater will be its arbitrary and random effects on the distribution of income and wealth. Inflation tends to redistribute from savers and lenders to borrowers, from those with fixed nominal incomes to those who pay such incomes, and so on. Clearly, such arbitrary redistributional effects are hardly in line with a distribution policy based on fairness. 2. Developments since the crisis Several years of good growth Since the upturn from the profound crisis in 1991-93, economic growth in Sweden has averaged 2.8 per cent, which is higher than we were accustomed to in the inflationary 1970s and 1980s. Moreover, the composition of growth has been favourable, with exports and investment predominating (Diagram 1). It should be underscored that this has been accompanied by the lowest level of inflation for decades.

The low inflation as such has no doubt helped to make the economy function better. The conditions for a long, stable upswing have improved. Together with clearer price signals, this makes it easier for households and firms to plan and make decisions. The workings of the economy have also been improved by the tax reform, various deregulations and changes to social security systems. Competitive pressure has grown as a result of EU membership and the globalisation of trade. The result is discernible in a higher rate of capital formation and structural changes in the economy. In both 1994 and 1995 GDP growth topped 3 per cent. In 1996 the growth of final demand remained fairly high, 2.1 per cent, and the rate accelerated in the second half-year to 2.6 BIS Review 56/1997  -3-  per cent from the corresponding period the year before. Total production, however, did not match the growth of final demand, the reason being that firms chose to trim stocks. The growth of GDP, which represents total output, stopped at 1.1 per cent in 1996.
This is new territory for us all and I expect it will be part of the ongoing supervisory dialogue in the years ahead. Thank you for your attention and for joining us today at the New York. I will be available during today’s lunch session to discuss further, and I hope you enjoy today’s conference. 1 I thank Jacqueline Fenton for assistance drafting these remarks. 2 Kevin J. Stiroh, Introductory Remarks at the New York Feds first Fintech Research Conference, March 22, 2019. 3/3  BIS central bankers' speeches

The amount due to and due from such overseas banks amounted to RMB 128 billion yuan and RMB 146 billion yuan respectively, a clear indication that banks from around the world are using the robust platform and large liquidity pool to offer RMB services to their customers at home. Looking ahead, we in Hong Kong will seek to broaden and deepen our offshore RMB market further, by enhancing our RMB infrastructure and encouraging participation. In doing so, we will continue to cooperate with other places along the way. From the end of next month, the operating hours of our RMB Real Time Gross Settlement system will be lengthened to 11:30 pm Hong Kong time, giving financial institutions in different parts of the world an extended window to settle offshore RMB payments through the Hong Kong infrastructure. Moreover, the Hong Kong – London Forum for promoting cooperation on the development of offshore RMB business just convened its first meeting yesterday. I am very pleased to note that the group had a very productive discussion, with concrete joint action plans set forth for enhancing offshore RMB market activities in both places. Meanwhile, we at the HKMA will also be continuing our efforts to raise awareness about the developments of offshore RMB businesses and the comprehensive services provided by Hong Kong in this regard.
Strength of our country is the fact that compared to earlier low-growth periods it has more liquid external funds available. At the same time, the financial sector is healthy and non-performing loans have diminished over time. Reforms currently under discussion, particularly a New General Banking Law, aim to bolster resilience and improve banking capital adequacy ratios (figure 10). Figure 10 Regulatory Capital  NPL  (percent of risk-weighted assets)  (percent of total loans)  Latin America (*)  Chile  18  18  15  15  12  12  9  9  6  6  3  3  0  0 10  11  12  13  14  15  16  3  3  2  2  1  1  0  0 10  11  12  13  14  15  16  (*) Shows the region’s simple average. Source: Global Financial Stability Report, IMF. The medium- and long-term outlook 19. The Chilean economy has endured a long period of slow growth, while its potential growth has dropped to a range between 2.5% and 3%, i.e., less than estimated a decade ago (4% to 5%). In principle, this change is explained by: (a) a smaller contribution of the accumulation of productive factors, inherent to a maturing economy; (b) a drop in gross fixed capital formation that has lasted several years; (c) reduced mining productivity; and (d) a limited contribution of productivity growth in the other sectors. 20.

Impact de la non compensation (netting) des opérations sur les dérivés sur le total bilan et les leviers des banques US  Augmentation du total bilan si non compensation des opérations sur dérivés (hors repos)  Impact du netting sur les ratios de levier des banques  Source : Risk.net (d’après Credit Suisse et Fitch)  BIS central bankers’ speeches  7
True, there are other external factors that generate what is occasionally unwarranted mistrust of the Kingdom of Spain. Undoubtedly, factors such as market irrationality, herding or procyclicality are significant, but they will not foreseeably change. There are also other factors, such as the mistakes made by European Union Member States when attempting to resolve their problems, that are no doubt also responsible for this higher cost, and the proof is that the sense of incapacity being conveyed to the markets does not only affect our country, as shown by the abnormally high level of most euro area countries’ CDSs. But it must also be accepted that the possibility of improving economic governance in Europe is in the hands of many other countries and not only Spain. This is why we should focus on easing the concerns of the markets, which do largely depend on us. These concerns are those that I have mentioned: there are doubts as to whether we will be capable of seeing through the fiscal adjustment, concluding the restructuring of savings banks and changing the institutional framework in a way conducive to job creation in Spain. As to the fiscal adjustment and to financial restructuring, I believe the means and the schedule set by Parliament are correct, and now it’s a question of complying.

But I will conclude by quoting a Frenchman, Clément Beaune, the new Minister for European Affairs, who I believe sums up the situation eloquently: "Celebration is necessary, but it is never enough and does not dispense with what has for six decades been the unique strength of the Franco-German relationship: a working relationship, organised at all levels of our political and administrative life, whose power stems from the fact that our two countries have indeed often divergent positions but know, at key moments, how to overcome them by involving others”. Involving others is what we did in July 2019 with the appointments to the Commission and the ECB, and even more so this year in the face of the crisis. Together we have served Europe and Europeans well. We can be sure of one thing: they will still need our common commitment, on many ambitions and for a long time to come. i Clément Beaune (2020), “L'Europe, par-delà le COVID-19”, Politique étrangère, autumn. 4/4  BIS central bankers' speeches
2  BIS central bankers’ speeches  Climate change is the Tragedy of the Horizon. We don’t need an army of actuaries to tell us that the catastrophic impacts of climate change will be felt beyond the traditional horizons of most actors – imposing a cost on future generations that the current generation has no direct incentive to fix. That means beyond: •  the business cycle; 9  •  the political cycle; and  •  the horizon of technocratic authorities, like central banks, who are bound by their mandates. The horizon for monetary policy extends out to 2-3 years. For financial stability it is a bit longer, but typically only to the outer boundaries of the credit cycle – about a decade. 10 In other words, once climate change becomes a defining issue for financial stability, it may already be too late. This paradox is deeper, as Lord Stern and others have amply demonstrated. As risks are a function of cumulative emissions, earlier action will mean less costly adjustment. 11 The desirability of restricting climate change to 2 degrees above pre-industrial levels 12 leads to the notion of a carbon “budget”, an assessment of the amount of emissions the world can “afford”. Such a budget - like the one produced by the IPCC 13 – highlights the consequences of inaction today for the scale of reaction required tomorrow. These actions will be influenced by policy choices that are rightly the responsibility of elected governments, advised by scientific experts.

24  The IPCC gives a range of budgets for future emissions which depends on assumptions about other climate drivers and the level of risk of temperatures going >2 degrees that society is willing to accept. It sets these in the context of existing fossil fuel reserves. See table 2.2 in IPCC (2014). BIS central bankers’ speeches  7  If that estimate is even approximately correct it would render the vast majority of reserves “stranded” – oil, gas and coal that will be literally unburnable without expensive carbon capture technology, which itself alters fossil fuel economics. 25 The exposure of UK investors, including insurance companies, to these shifts is potentially huge. 19% of FTSE 100 companies are in natural resource and extraction sectors; and a further 11% by value are in power utilities, chemicals, construction and industrial goods sectors. Globally, these two tiers of companies between them account for around one third of equity and fixed income assets. On the other hand, financing the de-carbonisation of our economy is a major opportunity for insurers as long-term investors. It implies a sweeping reallocation of resources and a technological revolution, with investment in long-term infrastructure assets at roughly quadruple the present rate. 26 For this to happen, “green” finance cannot conceivably remain a niche interest over the medium term. There are a number of factors which could influence the speed of transition to a low carbon economy including public policy, technology, investor preferences and physical events.
At the HKMA, we have been proactive in using technologies to make financial services more accessible, especially for consumers and SMEs. Over the past year, we have launched Open API, a framework that allows third party providers to aggregate information about the products and services offered by different banks for the benefit of end-users. Licences have now been granted to three virtual banks, with potentially more on the way, which will enhance the spectrum of products and services available to retail customers and SMEs. Another application launched was Faster Payment Systems or FPS, a 24/7 retail payment platform that offers cross-bank, cross-eWallet transfers in Hong Kong dollar or RMB. All that’s needed is the recipient’s phone number or email address. We have also introduced applications that help corporations: the eTradeConnect platform, for example, uses DLT-based technology to bring the paperwork-heavy trade financing business into the digital era. Other Asian economies have also been actively engaged in fintech solutions that help make access to financial services easier for their constituents. Without a doubt, a lot more work still needs to be done on fintech, especially when compared with other areas such as e-commerce and social networking where the impact of technology has been and continues to be immense. Second, Asian economies need to continue to promote long-term investments and stable capital markets. Research has firmly established that well-functioning financial systems are crucial to economic development, and that capital mobility in particular is beneficial for middle income economies.

The 2002 wage settlement resulted in very high wage growth for the fifth consecutive year. The Norwegian economy was exposed to considerable unexpected disturbances from the end of 2002 and in 2003. Economic developments in other countries were an important factor behind the appreciation of the krone. In the autumn of 2002 and into 2003, growth in the global economy moved on a different path and was substantially weaker than Norges Bank and other observers had expected. Weak developments in the global economy resulted in lower interest rates abroad and a wider interest rate differential between Norway and other countries. Developments in international equity markets and the risk of higher oil prices also contributed to strengthening the krone. A persistent downturn abroad, the likelihood of lower wage growth in Norway and a strong krone have led to reductions in the interest rate of more than 5 percentage points since December 2002. The sight deposit rate has been 1.75 per cent since March this year. Monetary policy easing has been aimed at  2  BIS Review 61/2004  bringing inflation up towards the target of 2.5 per cent and stabilising developments in output and employment. The decline in interest rates since December 2002 has contributed to weakening the krone. Measured by an index of 44 trading partners (I-44), the krone depreciated through 2003 by almost 11 per cent from its strongest level in January of the same year. The krone has fluctuated moderately in 2004.
Regulation is forcing market participants to reexamine the extent of their engagement and make more efficient use of their balance sheets. This adjustment process coincides with central banks worldwide adopting a series of unconventional monetary policy measures that have also affected the nature and scope of repo market activity. Some of these effects will prove temporary, others more permanent. Their full impact can only be assessed in earnest once markets have fully transitioned to their new steady state. From a central bank perspective, it is important to ensure that our own measures do not adversely affect the intermediation capacity of repo markets. Our decision in December last year to also accept cash as collateral in our securities lending facility has proven very effective in this respect. It contributed to mitigating risks of extreme specialness, while preserving the effectiveness of our policy measures in the pursuit of our price stability objective. At the same time, a high degree of persistence in repo specialness lends support to the idea that the stock of securities already held by the ECB is likely to be a powerful channel through which our measures can help preserve accommodative financing conditions, even after the end of our net asset purchases. Thank you. 1 I would like to thank Riccardo Costantini for his contribution to this speech. I remain solely responsible for the  opinions contained herein. 2 See Gorton, G. (2012), “Securitized banking and the run on repo”, Journal of Financial Economics, Vol. 104(3),  pp. 425-451; and Holmstrom, B.

The result can be that an inexpensive solution – BankAxept – is supplanted in favour of more expensive solutions. In Denmark, merchants charge a fee to customers who use a credit card. A similar practice in Norway could keep down payment costs. The profit banks earn on the use of international payment cards is higher than on BankAxept. It is therefore likely that, in isolation, it is in the interest of many banks for customers to choose international payment cards. New European regulations that will set a cap on the fees issuers of payment cards can charge are in the pipeline. This will likely weaken banks’ incentive to promote international payment cards. Banks continue to lose money on payment services. The cost survey we are presenting today does show that banks’ cost coverage has increased somewhat over time. But income still amounts to only 76 percent of the costs associated with payment services. Banks lose money on all main types of payment instruments, except for international cards. The losses must be covered by income from other banking activities. Pricing that does not cover costs may be a conscious choice by banks. Some customers may believe that they should not have to pay for using their own money. At the same time, mispricing and losses weaken banks’ ability and willingness to promote efficient solutions and invest in new infrastructure. That is not a forward-looking approach. We must invest now to ensure efficient and secure payments also in the future.