samchain/econo-pairs-v1 huggingface dataset:
As I see the Czech Republic a part of the developed world, I believe this is a topic that is relevant to the Czech National Bank. The key constraint or dilemma – or even puzzle, if you will – for us in the central banking community has been one key real variable which we believe is beyond the reach of central bankers. That variable is the real equilibrium, or natural, interest rate. We believe that this variable is absolutely key for the economy and that it is exogenous (i.e. not in hands of anybody, or at least not central bankers). At the same time, it critically influences both the financial sector and the real economy. I have tried to depict what I want to say on this very stylised chart (Chart 1). Chart 1: The role of the equilibrium interest rate  1/5  BIS central bankers' speeches  It basically shows that if you have got the natural real equilibrium interest rate at a certain level – and, of course, it is not directly observable, we can only estimate it, like the output gap, for instance – monetary policy must take this variable into account and must in fact respect it. Given the inflation outlook, the movements of nominal interest rates or policy rates should, in an ideal world, imitate those of the equilibrium rate. Or at least they should not deviate much from equilibrium. Why? Because this interest rate interconnects the future, the present and the past.

But if this model is right, higher rates would not help either, as rates substantially above equilibrium would mean that demand for loans from banks would decline sharply and the riskiness of future projects would increase, and even currently viable projects might turn into unviable, nonperforming ones. But let’s go back. What is a real problem, and take it as a criticism of our own club, is that we are unable to explain this story, this narrative. I have long pondered why this is the case. Recently, I caught a glimpse of an answer in the work of the young German economist Benjamin Braun. Like him, I feel that people have simply stopped understanding us. After 2008 we started to tell a different “monetary story” – a different narrative about money and central banks – to the one people were used to. Public confidence in the monetary system was and is grounded in the previous narrative, which in turn is based on three building blocks. One, the central bank is the sole creator of money and thus has perfect control over the quantity of money; money is therefore exogenous, to use the language of economics. Two, commercial banks do not create money but merely convert existing deposits passively into loans. And three, the lower the growth in the price level, the better. This narrative, which some would term imprecisely “monetarist”, did a very good job of reconciling public preferences and central bank decisions when bankers were fighting inflation and subsequently working successfully to stabilise it, i.e.
These include: •  Stable macroeconomic environment as reflected in single digit inflation, reduction in lending interest rates and a stable exchange rates  •  Amendments/Harmonisation of financial sector legislation such as the Development Bank of Zambia (DBZ) Act, the National Savings and Credit Act (NSCA), the Pensions and Insurance Act, the Building Societies Act (BSA) and the Banking and Financial Services Act (BFSA) in 2005. •  Establishment of a credit reference bureau in 2006; and Promulgation of microfinance regulations in 2006. Honourable Minster – The production of market knowledge on the supply and demand for financial services in Zambia was identified as one of the priority areas under the FSDP. In this regard, FinMark Trust of South Africa was contracted by our cooperating partners the Swedish International Development Agency (Sida) and the United Kingdom’s Department for International Development (DFID) to undertake this important activity and subsequently, the FinScope Zambia 2005 Survey, a comprehensive demand-side survey of consumer interactions with financial markets in Zambia, was conducted in November 2005. The main objective of the survey was to measure access to and use of financial services, along with how people manage their finances and what drives their financial behaviour. Honourable Minister and Invited Guests - This morning we are here to share with you, the findings of the FinScope Zambia 2005 Survey. These findings are expected to play an important role in profiling demand for financial services in Zambia.

Our goal is to provide information that helps households and businesses follow the data along with the Fed. If people know more about how the economy is performing and how that is likely to influence our actions, this should make it easier for us to achieve our twin objectives. I will now turn it over to Rob to discuss the Snapshot in greater detail. 2  BIS central bankers’ speeches
BIS Review 69/2010  1  But the situation is fragile. The crisis has given rise to new imbalances. Fiscal deficits have risen substantially in many countries and a number of countries are in the midst of a fiscal crisis. Government debt in the major advanced economies is as high measured as a share of GDP as it was immediately after the Second World War when the surge in military spending had been financed by borrowing. Even with substantial tax cuts, strong growth in public spending and very low interest rates, unemployment has risen considerably in both the US and Europe. In many countries, unemployment has reached double digits. There is a risk that unemployment will become entrenched, particularly perhaps in Europe. 2  BIS Review 69/2010  2. Financial crisis  After a long upturn, the financial crisis started to unfold in summer 2007. In autumn 2008, a full-blown systemic crisis erupted in the financial system. After the collapse of the investment bank Lehman Brothers, activity in money and credit markets almost came to a halt. Risk premiums in money markets and in corporate bond markets rose to a very high level. Governments took action to stabilise economic developments by supporting banks, cutting taxes and increasing spending. During this phase, the effects on government borrowing rates were limited. Interest rates in Greece and Ireland rose markedly. The fall in financial markets came to a halt at the beginning of March 2009.

Measured against Norway’s trading partners, the cost level is almost 20 per cent higher than the average for Norway’s oil age. Norwegian enterprises will often lose contracts abroad with the current high level of spare capacity in other countries. During the upturn, Norwegian enterprises fared well in spite of high costs because they increased efficiency and because sales were strong and prices high. Norwegian labour has been very costly, but nevertheless fully employed. Market conditions will become more demanding ahead. Even with a floating exchange rate, we cannot expect any substantial decline in Norway’s relatively high cost level as economic conditions are even weaker in other countries in our region. The industry structure in Norway is different from that of other advanced economies. We benefit from growth in Asian countries because of our sizeable commodity exports and freight industry. We are vulnerable to a slowdown in growth in Asia, which could lead to a fall in commodity prices and deterioration in our terms of trade. Norway’s high cost level may at the same time make it difficult for the business sector to shift to new markets. The economic geography of Norway will change over the next 10–15 years. The domestic cost level and low growth in Europe will bring pressure to bear on jobs and businesses in manufacturing communities. Job losses will have the most pronounced effects in areas where manufacturing has the highest concentration. Entire manufacturing sectors may be lost. BIS Review 69/2010  11  6. Conclusion  Let me conclude.
Page 1  The cost of living - speech by Andrew Bailey Given at Brunswick Group’s Cost of Living Conference, Coin Street, London  Page 2  Published on 01 March 2023  Andrew Bailey shares what we learnt from talking to people at our outreach events across the UK during the past year. Speech The latest release of data for the UK consumer price index showed an annual increase of 10.1% in January. It is down from a peak of 11.1% in October, not least because direct effects from energy prices have eased. But also, core inflation, which excludes the most volatile components of the consumer price index, fell more than expected to 5.8% in January. The Bank’s Monetary Policy Committee spends a lot of time poring over these data. Consumer price inflation remains much too high, and it is our job to bring it back down to our 2% target. That is why we have increased Bank Rate by nearly 4 percentage points over the past 15 months. To set the appropriate level of Bank Rate over the months ahead, we have to monitor our progress towards our target very carefully. But the data can only tell us so much. At times like these, more than ever, it is important to hear the human stories behind the data. These stories help us understand both what is actually going on and the impact it has on people’s lives.

Thus, the ability to compete is no longer based on access to raw materials of land, capital and labour. It will demand much more. It will depend on how these resources are exploited. The new environment thus calls for greater focus on building capabilities. The new environment also presents increased uncertainty affecting the level of preparedness. In addition, under an increasingly more uncertain environment, the traditional approach can no longer be applied. Making sound strategic decisions under uncertainty requires a different approach. In this case, understanding the range of possibilities and the ability to perform under different circumstances becomes important. Knowledge and speed becomes the essence in this new environment. The speed of access to knowledge therefore needs to be continuously enhanced. Smart partnerships becomes highly relevant in this new economic order. Tremendous benefit can be gained from collaboration and partnerships. Such collaborations in this new economy needs to extend across borders. Distinct efforts need to be made to prepare for this new economic age. The strategies have to be developmental. High fliers that do not develop capabilities will not be equipped for the long-term. Investment, therefore, has to be made for the future. Among the key strategies will be the continuous investment in building the capabilities and capacity, setting the performance standards and promoting strategic alliances. This has to be achieved with a clarity of the goals. This is particularly important in an environment of intense short-term pressures.
Thomas Jefferson believed that the US Constitution should be rewritten every 20 years or so at a new constitutional convention.7 Second, we cannot fully describe an optimal monetary arrangement because we do not know all possible states of the world and hence the policy rule to which we would like to commit. Those two aspects of the technology of collective decisions create a role for institutions. But they differ in important ways. If there were only a commitment problem, then we could describe an optimal state-contingent monetary policy reaction function. Mechanisms could then be devised to make it less likely that policy would deviate from this optimal plan - perhaps by writing the optimal rule in the form of a constitutional provision which could be overturned only by a substantial majority, or financing deficits by issuing index-linked debt. Such mechanisms would make it incentive compatible collectively to stick to the optimal plan. None of this would have come as a surprise to the authors of the American Constitution. In Federalist Paper No.10 James Madison points out that “our governments are too unstable” (p173) and in No. 37 he writes: “the people of this country, enlightened as they are with regard to the nature ... of good government, will never be satisfied till some remedy be applied to the vicissitudes and uncertainties which characterise the State administrations” (p243). Outside observers agreed.

Mervyn King: The institutions of monetary policy Lecture by Mr Mervyn King,1 Governor of the Bank of England, at the American Economic Association Annual Meeting, San Diego, 4 January 2004. The references can be found on the Bank of England’s website (www.bankofengland.co.uk)  *  *  *  President, Ladies and Gentlemen, To have one central bank governor address you today may be regarded as a misfortune, but to invite two looks like carelessness! It is a great honour to be invited by this year’s President-Elect, Marty Feldstein, to deliver the Ely lecture. Marty has been my teacher, mentor, colleague and friend for over thirty years, and I never cease to be amazed by the energy and imagination which he devotes to the study of economic problems. I got to know Marty during my time as a Kennedy Scholar at Harvard in 1971. The Kennedy Scholarships form one part of Britain’s national memorial to President Kennedy. The other part is an acre of land, now American territory, at Runnymede. At the ceremony to open the Runnymede memorial in 1965, Prime Minister Harold Wilson remarked about President Kennedy that “his eyes were on the horizon, but his feet were on the ground”. Almost thirty years earlier Richard T. Ely published his autobiography entitled “Ground under Our Feet”. Whereas I found the experience of coming from Europe to the United States intellectually liberating and exhilarating, a hundred years earlier Ely found academic freedom by making the reverse journey.
Mervyn King: How international cooperation can raise Britain’s economic performance Opening remarks by Mr Mervyn King, Governor of the Bank of England, at the Panel on EU/US cooperation at the Advancing Enterprise Conference, London, 26 January 2004. *  *  *  Chancellor, Ladies and Gentlemen, In this session we shall examine how international cooperation can raise Britain’s economic performance. Before introducing our speakers this afternoon, I would like to present a few facts about productivity in this country, and then pose three questions. You might ask why a central bank governor is chairing a panel on enterprise. Well, some believe in prudence for a purpose; we believe in stability as a spring-board, a springboard for enterprise. Since the start of the Railway Age in the 1830s, output per person has increased ten-fold in Britain; it has increased twenty-fold in the United States. That is because over that period output per person rose on average by 1 ½% a year in the UK and by 2% in the US. The result is that the level of output per person is now around 25% lower in Britain than the US. In part this reflects shorter working hours, but it also reflects a lower level of productivity. From around 1980, however, the productivity gap between Britain and United States started to close, and for the following 15 years or so labour productivity actually rose significantly faster in the UK than the US, at an annual rate of 2.1% compared with 1.4%.

Third, is the existence of overlapping jurisdictions affecting economic performance in the UK and elsewhere - in areas such as tax, competition policy, the regulation of mergers, patents, insolvency law, and recent changes to corporate governance? And can “economic cooperation” overcome some of these problems, and, if so, how? With those questions in mind, let me now introduce our four speakers this afternoon. First, Niall Fitzgerald, Chairman and CEO of Unilever, who has been instrumental in the recent relaunch of the Transatlantic Business Dialogue. Second, Donald Johnston, the Secretary-General of the OECD since 1996, who served in the Canadian Cabinet during the 1990s. The OECD is conducting a study to quantify the potential benefits of closer economic cooperation between the EU and US. Third, John Snow, the US Treasury Secretary, who will be joining us on a video link later in the session. Fourth, Gerrit Zalm, the vice Prime Minister of the Netherlands and Finance Minister since 1994. So, without further ado, let me turn to Niall Fitzgerald. BIS Review 6/2004  1
When these liabilities exceeded the long-term equilibrium level, the household sector could no longer pay off the accumulated debt. What were the consequences? An extreme and constrained adjustment of consumer behaviour and approach. Households could no longer pay their debts to banks and maintain the same level of consumption. These individual imbalances altogether appeared in a macro level, mainly in the form of abrupt fall of demand, slower economic activity and depreciation of the exchange rate (US dollar depreciation). Naturally, the financial system could not escape from being affected by this challenging contagion. BIS Review 115/2008  3  What I have stated above points out the necessity of making thorough analysis at a micro level in addition to the macro ones. That is, the recipes for attaining a stable macroeconomic situation should begin and be sustained by prudent analyses at a micro level. It is for this reason that I would like to dwell on and explore one of the indicators that affects the structure and modelling of household budget. I refer here to workers’ remittances which have played a key role in smoothing consumption and at a lower level, meeting investment needs, mainly for real estates and small household businesses. Remittances have somehow offset the low productivity and the negative effects triggered by unemployment. In addition, they have helped to preserve financial stability, by establishing more balanced ratios between income and expenditure. Given the importance of workers’ remittances, one would rightly raise the following question: What is their perspective?

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The Government may therefore raise the question of membership of the fixed exchange rate mechanism when future participation in the monetary union is judged to be imminent. Government decides exchange rate system, the Riksbank its application As regards ERM2, what are the Government and the Riksbank, respectively, responsible for? The Riksbank Act, amended as of 1999, states that the exchange rate system is decided by the Government and applied by the Riksbank. This is the same arrangement as in virtually the whole of Europe. The decision as to whether and when the krona is to be linked to ERM2 is thus a matter for the Government. The Riksbank in turn determines how the exchange rate system chosen by the Government is to be applied, which involves setting the central rate and band width in a fixed exchange rate system and deciding any interventions. In practice, if Sweden is to participate in ERM2, the law requires the involvement of both the Government and the Riksbank. They must also agree on the conditions. Moreover, ERM2 membership would not be decided unilaterally by Sweden; it is something that has to be negotiated with the other EU countries. n the event of Sweden wishing to join ERM2, what would be the procedure? The negotiations would be conducted in the Economic and Financial Committee, which has succeeded the Monetary Committee. Each country is represented there at the level of under-secretary in the Finance Ministry and central bank deputy governor.

Such investments can be found in the emerging markets of Asia, especially in China. Although the dynamics are somewhat different in China, its tale of economic growth is as legendary as that of the Middle East. China has experienced a huge inflow of funds in search of growth opportunities and at the same time the Mainland authorities have been gradually opening up the country’s outward investment. As a Special Administrative Region of China, Hong Kong plays a pivotal role as the IFC of China in the course of financial liberalisation. Not only has it acted as a conduit for Mainland companies accessing international markets through IPOs, but also one of the largest sources of foreign direct investments for Mainland China. With the continuing financial liberalisation on the Mainland, Hong Kong is positioned as the most attractive destination both for investing into China and tapping China's funds. What are the challenges for us? Opportunities aside, we are of course aware that Hong Kong also faces challenges in developing Islamic finance. It is a fact that Hong Kong’s Islamic community is not big, but we are confident that the development of Shariah-compliant financial markets can take off even in environments in which the domestic Islamic community is relatively small, simply for the fact that investors nowadays are looking beyond domestic boundaries and traditional finances as financial activities gravitate towards the Middle East and China. Indeed Hong Kong’s relatively small population does not seem to undermine in any way our performance in the conventional financial and capital markets.
15  Figure 7 Evolution of 2018 growth outlook (annual change, percent)  3.8  World  3.8  2.2  3.6  3.6  3.4  Developed  Emerging  2.2  5.0  2.0  2.0  4.8  4.8  3.4  1.8  1.8  4.6  4.6  3.2  3.2  1.6  1.6  4.4  4.4  3.0  3.0  1.4  1.4  4.2  4.2  18  18 Apr.17  Oct.16  5.0  18 Oct.17  Source: International Monetary Fund WEO, October 2017. Figure 8 Copper price (1)  Oil price (1) (2)  (dollars per pound)  (dollars per barrel)  3.6  3.6  75  3.2  Dec.17 Report 3.2  65  65  2.8  2.8  55  55  2.4  45  45  2.4  Sep.17 Report  2.0  2.0  35  1.6  1.6  25  15 15 16 16 17 17 18 18 15 Jul. 16 Jul. 17 Jul. 17(f) 18(f)  Dec.17 Report  Sep.17 Report  75  35  25 15 15 16 16 17 17 18 18 15 Jul. 16 Jul. 17 Jul. 17(f) 18(f)  (1) The dots show projected oil and copper price for 2017, 2018 and 2019, respectively. (2) Simple average between Brent and WTI oil. Sources: Central Bank of Chile, Bloomberg and Chilean Copper Corporation (Cochilco).

Figure 15 Banks with CAR equal to or higher than 10% in stress scenario (*) (asset share, percent)  100  100  80  80  60  60  40  40 1st 2nd 1st 2nd 1st 2nd 1st 2nd 1st 2nd 1st 2nd 1st 2nd half half half half half half half half half half half half half half 2011  2012  2013  2014  2015  2016  2017  (*) Results of stress tests presented in respective Financial Stability Reports. Source: Central Bank of Chile using SBIF data. 20