samchain/econo-pairs-v1 huggingface dataset:
Nevertheless, we see the recovery being driven to a large degree by consumption growth which is quite steady; surprisingly steady to be fair, given that 20 percent of our employment got hit with the shutdown in foreign tourism. The overall consumption has held up surprisingly well largely due to higher-income people that are still able to consume. Besides Page 4 of 11  consumption, the recovery is also driven by exports, which I am sure all of you know, has responded quite well largely due to improvements in the economic growth of our trading partners. It is not just only China that has done consistently well, but also the United States would likely see very strong growth going forward given the recent stimulus package. Hence, we expect the overall recovery to be driven substantially by private consumption and exports in the year ahead. The big risk to the outlook that I mentioned is again tourism. In our baseline forecast of 3 percent GDP growth this year, we assume foreign tourist arrival of about 3 million, and most of that is expected to be in the fourth quarter. So if for some reasons, the vaccine rollout is delayed or we are not able to open the economy as expected by the fourth quarter this year, the GDP growth of 3 percent would be less likely. The 3 million this year is not that much, however, this risk will become more significant for the next year.

While rules and regulations will certainly be there to ensure orderliness, fair and ethical conduct, risks of a rapidly changing environment would require flexibility and agility in their design. This is both good and bad news. The good news is that the design of rules could be more principle based, outlining key parameters and outcomes, leaving the ‘how’ to achieve them to the best practices of the industry. The bad news is that the industry will have to be independent in figuring out and ensuring compliance. Consequently, there is a need for the industry to further elevate its capacity and capability for the new environment. The goal is not only the greater adoption of digital technology in financial services which will undeniably reshape customer behaviour, business models and the traditional structure of financial intermediation for the better. It is also the push for the industry to adapt, innovate and change. In the banking sphere, digital banking is just around the corner. The Bank will issue a discussion paper on this by year end and perhaps, a regulatory framework by next year. Digital insurers could be next. What about financial markets? I put this challenge to you ~ think about how your industry could change with these developments, how you should adapt and change, and what needs to be done. Tell us what you think and you can reach out to the FMC to share your thoughts and ideas. Another area of focus that has captured wide attention is that of climate change and sustainability.
This question is one that the Central Bank and the Monetary Policy Committee must grapple with at all times. In the recent term, monetary policy has been conditioned by the private sector debt crisis, which stems from years of overheating and the subsequent financial crisis. As the debt situation improves and the slack in the economy diminishes, it will become more important to tackle inflation aggressively. Historical and international experience shows that this cannot be done without temporary sacrifices in economic activity and employment levels. We must therefore hope that inflation subsides as forecast in the near future. Lifting the restrictions on capital outflows is one of the most complex tasks facing the Icelandic authorities at present. The controls probably prevented further depreciation of the króna after the banks collapsed, although no one knows how long the depreciation would have persisted. The controls therefore provided shelter for restructuring of private sector debt and the financial system as a whole and afforded monetary policy the room to concentrate more on domestic economic conditions than would otherwise have been possible. The benefits of the capital controls are most pronounced during the resolution of the balance of payments problems proceeding from the collapse of the financial system. If all nonresidents’ so-called impatient claims on residents were paid in a short period of time, Iceland would pay down foreign debt much more rapidly than is desirable. If worse comes to worst, the deleveraging could amount to roughly half Iceland’s GDP in relatively few years.

Growth in business investment is an important factor, contributing over 25% in 2011. Business investment measured 9½% of GDP during the year. This is somewhat below the 30-year pre-crisis average of 13%, but the good news is that in Q4 the ratio of business investment to GDP was up to 12.2%. Of course, business investment should rise up above the average in a conventional upswing. But our upswing, as that of most other countries hit hard by the financial crisis, is not conventional. Iceland suffered a deep banking and currency crisis in 2008. Research shows that the contraction following such a twin crisis is usually deeper and more protracted than a contraction following either one of these crises. In addition, research shows that the economic recovery following a financial crisis is generally weaker than after a normal recession, as domestic debt levels are high. And finally, studies show that the post-crisis recovery of investment is usually slower than usual if the investment level was high before the crisis struck. All of these factors apply to Iceland and should be borne in mind in any discussion of the strength and pace of the economic recovery. The labour market has developed broadly in line with the business cycle and the historical experience of Iceland and other countries. During the downswing, firms appeared to have tried to avoid layoffs, opting instead to reduce the number of hours worked and step up parttime employment.
Zeti Akhtar Aziz: Building financial systems for sustainable development Speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Global Ethical Finance Forum “Building Financial Systems for Sustainable Development”, Edinburgh, 1 September 2015. *  *  *  It is my distinct pleasure to speak at the Global Ethical Finance Forum here in Edinburgh. I would like to warmly thank the Scottish Government and the Middle East Global Advisors for the kind invitation for me to speak at this forum. It is a privilege to be here in the company of this distinguished and diverse gathering of professionals from the various fields that are prioritising ethical finance for sustainable development. The discussion on ethical finance that supports sustainable development is timely. In this recent decade, we have had to deal with a financial crisis of unprecedented global proportions that has stemmed in part from the prevalent ethics and culture in the financial services industry. In this period, we have also witnessed significant occurrences of misbehaviour and ethical lapses surface in the financial services profession, including the manipulation of reference rates and deliberate compliance failures. Since the global financial crisis, we have now had several years to reflect on these weaknesses and to institute the much-needed reforms that have prioritised resilience and stability. Having made important progress on this front, it is timely to direct our attention to developing more enduring solutions that will place the financial sector firmly back in the service of society.

With the financial reforms by the international community now much in place, the imperative for future finance is not only by becoming stable and resilient but also becoming a deep anchor to its bedrock, the real economy and generating a positive benefit to the greater society. With that, allow me to wish you an engaging and productive forum. Thank you. 4  BIS central bankers’ speeches
–  We are also exploring an “all-in-one” addressing system, that will enable us to pay someone electronically using the payee’s mobile number, email address, social network account, or other proxies. No need to know the payee’s bank account number. Two, seamless data sharing through publication of open Application Programming Interfaces, or APIs. –  We just had a two-day API conference earlier this week, where industry players shared their views on how we can take the API strategy forward. –  MAS is working with FIs to leverage on new technologies to share aggregated data to improve market and risk analyses, forecasts and projections. We are committed to building a Smart Financial Centre, where innovation is pervasive and technology is used widely to: •  Increase efficiency  •  Manage risks better  •  Create new opportunities  •  Improve people’s lives. 4  BIS central bankers’ speeches

On the demand side, should emerging countries decouple to a large extend from the United States, their contributions would then be sufficient to maintain a significant pace of commodity prices growth. On the supply side, unexpected climate or geopolitical disruptions may lead to shocks on production, as in the past few years. On top of both factors, in the current context of raising inflation and troubled financial markets, commodities attract a growing part of investment, speeding up sometimes rather artificially their price increases. Second, the triggering of possible second round effects is a well known source of concern for the Governing Council of the ECB. The common desire of firms and households to offset  BIS Review 32/2008  1  profit margin and purchasing power losses stemming from inflationary shocks may lead to a wage-inflation spiral, ending in deteriorated output prospects and welfare losses to all parties. One should however note that nothing significant has materialised at this juncture. On the contrary, remunerations have remained well in line with productivity gains with, to take an example, reference wages increasing by 0.3% in France during the fourth quarter of last year. From this point of view, protracted shocks to food and commodity prices put the anchoring of inflation expectations and the credibility of monetary policy to the test. The recent upward trend in European household and market expectations may be of some concern.
As for the cost of labour, while it is true that since 2004 wages have been growing more in line with productivity, it also the case that not all the loss in competitiveness experienced before 2004 has been reversed. In 2006, in fact, unit labour costs were still 18% higher than in 2000. And although wage growth has been moderate in recent years, it has been even more so elsewhere. Indeed, when compared to those in the euro area, Malta’s relative unit labour costs have risen since 2000. There is little doubt that external competitiveness has deteriorated and that continued wage restraint, therefore, remains an essential ingredient in the recipe for achieving faster export-led growth. Productivity can also be boosted by making education and training systems better attuned to the needs of a competitive economy, by further reducing compliance costs and simplifying administrative procedures, and by improving the quality of the business infrastructure. Together with those suggested above, these measures can make a substantial contribution to strengthening the economy’s capacity to deal successfully with globalization. Lastly but no less importantly, it also needs to be realized that action on all these fronts is essential for preserving a social model that has reduced income inequality and secured wide access to education, health and pensions. Conclusion Mr. President, at this critical juncture in the country’s economic development on the eve of joining the euro area, the national interest calls for a strong sense of realism.

Failure to understand under which conditions an economy works best in today’s world to make possible concrete improvements in welfare can be very costly. There is, therefore, a need to foster a greater public awareness of developments in our external environment and of the appropriate policy responses. There is also a need for a wider acceptance of some basic truths, for example that it is an illusion to believe that something can be had for nothing, or that governments can fix any problem or grievance. On the contrary, policy makers and opinion shapers alike have a responsibility to explain that the expectation of ever increasing entitlements and higher living standards must be balanced with the recognition that these expectations cannot be satisfied sustainably through the redistribution of national income. In the long run, the expected improvements can only be financed through productivity gains and economic growth. And since nobody owes Malta a living, the responsibility for shaking off our ambivalent attitude to change and for turning globalization from a threat into an opportunity is ours and ours alone. 4  BIS Review 143/2007
Recent economic research – both analytical and empirical – is seeking to further explore how the economy’s performance is influenced by institutions and values; and, more generally, how the economy’s functioning may change if we relax some of the simplifying assumptions about (1) the behaviour of a seemingly “valueless”, perfectly rational homo oeconomicus; and (2) the functioning of markets that are “perfect and complete”, characterised by full information, rational expectations and largely unaffected by cultural and social values. In my presentation, I will address some of these issues by examining how and to what extent institutions and values may be affecting the performance of the European economy. To this end, I will first sketch out a simple conceptual framework indicating how economic performance, the functioning of markets, institutions and human values relate to each other. Second, I will show how the growth performance of the European economy – compared to that of the United States – can be accounted for by differences in the trend growth rates of productivity, labour utilisation and population; and then I will discuss – on the basis of the empirical evidence available – the role of economic institutions, social preferences, values and attitudes in explaining, at least partly, these differences. A key issue of practical and policy relevance is whether European economic performance can, in fact, be improved without giving up values or preferences that are considered to be quintessentially European.

Moreover, the attempt to examine and illustrate these relationships on the basis of the performance and the available empirical evidence for the European economy – in comparison with that of the US but also with the benefit of the different practices and experiences in European countries – did require some time for exposition; but, I believe, it has provided us with some useful conclusions of policy relevance. Let me end on an optimistic note. The European economy is currently experiencing robust economic growth which is expected to continue, benefiting from the ongoing strength of global economic activity, despite the slowdown of the US economy, but primarily relying on internal sources of growth, with domestic demand projected to expand at a solid pace. There are, of course, uncertainties and several risks surrounding this central and likely scenario. But, at the same time, there are encouraging signs that the supply-side of the European economy is responding positively to the reforms in markets and institutions implemented over the past few years. Productivity growth is picking up, employment is rising and the unemployment rate is projected to further decline. If future developments and further analysis confirm the indications of supply-side improvements, we can look forward to a gradual increase in the European economy’s potential for higher sustainable growth.
In Asia, this is being addressed at two levels – at the national level to develop inclusive financial systems and better social safety nets, and at the regional level, for regional initiatives to be inclusive, to ensure that regardless of the stage of development, countries in the group will build up their capacity and capability to benefit from the progress of the region. 4  BIS central bankers’ speeches  Conclusion Let me conclude my remarks; the new global policy frontiers are now addressing the challenges of the new global economic and financial landscape. Given the more connected and inter-dependent world, the call is for strengthening the cross-border dimension of policymaking. Asia has taken advantage of this period of relative stability to advance economic and financial integration, and to strengthen our economic potential. Asia will, however, continue to be vulnerable to external developments and future shocks. To be in a better state of readiness to withstand these eventualities, the policy priority is to build resilience. Not only having the buffers and institutional capacity, but also to come together collectively to manage the new challenges, and thus be positioned to contribute constructively to global stability and growth. BIS central bankers’ speeches  5

First, large fiscal burdens in many advanced economies have altered the risk profile of the supposedly risk-free assets such as their government securities. As the line between traditionally risk-free and riskier assets becomes blurred, investors would be more willing to search for yields and switch back and forth between assets more easily. Second, although the money used by advanced economies’ central banks to purchase securities has ended up mainly in the banking system for the time being, quantitative easing does help raise investors’ risk appetite. On the one hand, QE is likely to make the  BIS central bankers’ speeches  1  recovery of advanced economies a bit firmer through improved consumer and business sentiment. With that, investors’ risk-appetite has risen, driving investors to riskier assets, including commodities and emerging market securities. On the other hand, QE drives down yields in advanced economies. The combination of rising risk-appetite and low yields in advanced economies pushes investors to search for higher yields elsewhere and thus makes commodities and emerging market securities more attractive. Of course, we must note here that despite the altered risk profiles, government securities of advanced economies are likely to remain the ultimate safe haven assets. As such, portions of capital flows could reverse themselves very easily when risk appetite wanes. Experiences have shown that the so-called “risk aversion” episode could coincide with large withdrawals of funds from emerging markets back to advanced economies. These fluctuations in capital flows could potentially pose important challenges for emerging markets.
Our policy rate is still in a positive territory at a level of 1.25%, alternative instruments are available for targeted actions, the level of foreign reserves remains comfortable and the banking system stable with NPLs ratio of only 3.4%, despite the pandemics shock and closure of a bank in the midst of the pandemics. Of course we have to be vigilant, and not only of conventional side effects of "too loose for too long" stance, but also of the possible adverse feedback  1/2  BIS - Central bankers' speeches  loop between real and financial sector, as well as of the so called "zombification" risk. As complacency is not an option, shielding against those risks asks for further strengthening of the financial safety net, which will remain one of our priorities. Thus, although still overwhelmed with the current challenges and the need for further policy support, we must not remain oblivious to the pre – pandemic strivings to increase the potential to grow faster, but in a sustainable and inclusive way. This requires gradual shifting of the focus back to the pre-crisis structural bottlenecks such as the quality of institutions, strengthening the rule of law, investing in human capital and in the potential to innovate, as well as to new structural hurdles that will be left as a legacy of the pandemics, which might not be even well known at the current juncture. Clearly, we as central banks cannot play a main role in these segments, but perhaps a supporting one.

In fact, this is the first crisis episode when the initial reaction of the National Bank was loosening and not tightening the MP. This time, despite the strategy of de facto fixed exchange rate, solid fundamentals and strong official reserve buffers allowed for loosening of the monetary policy and adopting regulatory flexibility. Also, our initiative for access to the ECB backstop facility, which was also supported by other central banks in the region, and the positive ECB response, allowed for wider space for accommodative policies. The symbiosis of these actions has enabled conducive financial conditions, i.e. decline of borrowing interest rates at historically low levels and uninterrupted credit flows growing at a rate of 6% annually, double than in the EU, that helped "ring –fencing" of the labor market, preserving wages and jobs. Where do we stand now, what are the major challenges ahead and is it time for complacency? A common denominator for all policy makers at the moment is the lingering uncertainty. Many scenarios are in place, from smooth and orderly recovery, through strong rebound with price pressures, ending to stalled recovery amidst new and more virulent strains. From a central bank perspective, our advantage is that there is still policy room for maneuver, although narrowed.
BIS central bankers’ speeches  15  Chart 14: Sterling appreciated significantly since March 2013 before moderating recently 130  Sterling trade-weighted USD per £ Euros per £  120 115 110 105 100  Index (March 2013 = 100)  125  Jan 16  Dec 15  Oct 15  Nov 15  Sep 15  Jul 15  Aug 15  Jun 15  Apr 15  May 15  Mar 15  Jan 15  Feb 15  Dec 14  Oct 14  Nov 14  Sep 14  Jul 14  Aug 14  Jun 14  Apr 14  May 14  Mar 14  Jan 14  Feb 14  Dec 13  Nov 13  Oct 13  Sep 13  Jul 13  Aug 13  Jun 13  Apr 13  May 13  Mar 13  95 90  Source: Bank calculations. Conclusion The three factors I have described are guides to monetary policy decisions, but there are no magic thresholds.23 This journey doesn’t have a set timetable; only an expected direction of travel. In my opinion, we need to see cumulative progress in these three areas to have reasonable confidence that inflation is on track to return to the target and that a modest tightening in monetary policy will be necessary to ensure it does so sustainably.

As a result, equity capital is eroded by around 3 ½ percentage points of risk-weighted assets. Yet despite this assumed marked worsening in the global economic weather, the FPC judged that UK households and businesses would continue to be supported by our banking system. 2  BIS central bankers’ speeches  2. Financial conditions and macroprudential policy  The improvement in the price and availability of credit is one sign of the normalisation of the UK financial environment. Another is that, after seven years of deleveraging, aggregate credit to the UK private non-financial sector has begun to grow again (Chart 2). This has not been a debt-fuelled recovery. Aggregate private credit growth is modest compared to pre-crisis conditions, and is just now coming into line with nominal GDP growth (Chart 3). Chart 2: Credit growth in the private sector is recovering Private non-financial sector credit growth (oya)  Sample average  25 20  Per cent  15 10 5 0  1967 1968 1970 1972 1973 1975 1977 1978 1980 1982 1983 1985 1987 1988 1990 1992 1993 1995 1997 1998 2000 2002 2003 2005 2007 2008 2010 2012 2013  -5  Source: Bank of England.