samchain/econo-pairs-v1 huggingface dataset:
In the introduction of accredited training courses, it is necessary to co-operate with leading and renowned educational institutions to provide quality training so as to achieve the objective of raising professional standard and gain wide recognition. I am happy to announce that the Chinese University of Hong Kong and the University of Science and Technology will offer certificate programmes on dealing, settlement and fixed income securities. Practitioners can take these courses to obtain a professional qualification to meet part of the membership requirement of the Association. In addition, the new regime recognises the rapid evolution in financial markets, and the need for continuous professional training in upgrading the skills and expertise of practitioners. A new requirement on continuous professional training is therefore introduced for the renewal of the membership. In strengthening the international financial centre status of Hong Kong, it is important to foster our advantage in having a professional workforce. We believe that the launch of the new membership regime of ACI - The Financial Markets Association of Hong Kong and educational programmes will help upgrade the technical skills and expertise of treasury market professionals and help them to catch  BIS Review 58/2004  1  up with the latest developments in the markets. This will work towards our ultimate goal in raising overall competitiveness of treasury markets in Hong Kong. Alongside the rapid growth of the Mainland economy and the gradual liberalisation of their markets, there is an increasing demand for treasury markets products and services from the Mainland.

Marzunisham Omar: Risk and opportunity – managing risk for development Welcoming remarks by Mr Marzunisham Omar, Assistant Governor of the Central Bank of Malaysia, at the WB-BNM Seminar on the World Development Report 2014 “Risk and Opportunity: Managing Risk for Development”, Kuala Lumpur, 29 April 2014. *  *  *  It is my pleasure to welcome you to Sasana Kijang this morning to the seminar on the World Development Report 2014, with the theme “Risk and Opportunity: Managing Risk for Development”. Reading through the Report, I’m struck by two observations: •  first, in the past 50 years, middle-income countries have been in recession 14 to 16 per cent of the time and low income countries, a staggering 27 per cent of the time. •  second, from 1970 to 2011, there were 147 banking crises in 116 countries. So, while the world has, in the last 50 years, made significant progress in terms of economic development, poverty eradication and overall standard of living, the above observation begs the question of whether the global economy is also more prone to crises, highlighting the fragility of the economic system that is currently in place. This reinforces the need to have a proper framework to identify and manage risks, towards achieving a common shared goal of sustaining long-term development. Almost six years after the collapse of Lehman Brothers, the world economy is still coping with the aftermath of the Global Financial Crisis, notably the worst financial crisis in the last 70 years.
The third term represents the desire for gradual interest rate changes in criterion 3, i.e. that the current interest rate it should not deviate too far from the rate in the previous period it-1. The fourth term represents criterion 4 and can be interpreted to mean that there is also a cost or risk in setting an interest rate it that deviates substantially from the interest rate implied by simple monetary policy rules itsimple. By giving some weight to the consideration that the key rate  BIS Review 113/2010  3  should not deviate too far from simple rules, monetary policy may become somewhat more robust. 1 Key policy rate  A monetary policy that only takes into account the consideration of bringing inflation rapidly back to target (criterion 1) would imply that the interest rate should rapidly have been reduced to below 1 per cent when we presented the latest Monetary Policy Report. In that case, the interest rate would have had to be raised rapidly again to prevent activity and inflation from becoming too high further ahead. Such a strategy could be consistent with the desire to safeguard against inflation expectations becoming entrenched below the inflation target, but could on the other hand have a substantial impact on output and employment. Developments become more stable if weight is also given to stabilising output (criteria 1 and 2). This would also imply an interest rate reduction first and then an interest rate increase further ahead.

Limitations on loan-to-value and loan-to-income ratios, which are applied in Norway, are examples of rules that can have a stabilising effect. Minimum capital requirements for financial institutions and liquidity and funding structure requirements are other examples of rules that will make high credit growth more expensive for financial institutions, and thereby for customers. Rules to ensure that shareholders and creditors bear the cost if banks suffer substantial losses or have to be wound up will have a similar effect. Financial vulnerability can build up more quickly in periods of expansion, partly because financial institutions then have a stronger inclination to take risk. This implies that regulations should be countercyclical, having the strongest effect when the risk of a buildup of imbalances is greatest. It is important that the rules function as automatic stabilisers in the economy. Discretionary use of instruments is considerably more demanding. But it may nevertheless be advisable to introduce such instruments, such as capital requirements that vary over time with the rise in debt and asset prices. The Basel Committee, which assesses new rules for financial institutions and which includes members from major countries, has proposed the introduction of a time-varying capital buffer requirement over and above the minimum capital requirement. Financial corporations with a capital buffer judged to be insufficient would be subject to restrictions on dividends and other payments to shareholders and employees.
Such instruments could have reduced the likelihood of failure of large, systemically important institutions, reducing the significance of the “too big to fail” problem and its associated moral hazard problems. Harmonized standards The Financial Stability Board and the Basel Committee are working hard and are making important progress on all these issues. But for these efforts to bear fruit, it is critical that the requirements that are imposed in terms of capital adequacy, liquidity and compensation be harmonized across regulatory regimes and applied in a consistent fashion. The absence of a level playing field would be a recipe for disaster. A lack of harmonized standards would inevitably lead to balkanization and protectionism as different countries took steps to protect their particular banking champions. Potentially, this could lead to countries requiring capital and liquidity to be segregated locally. This would have a number of negative consequences. First and foremost, it could disrupt the ability for capital to flow freely across borders, interfering and inhibiting globalization in terms of financial intermediation. Second, it would reduce the diversification benefits that stem from banks that operate in different geographic locations. Third, it could undermine the safety and soundness of the financial system. In particular, the lack of harmonization in terms of regulatory regimes could lead to a “race to the bottom” as firms and businesses migrated to the most lax regulatory regime. So what does this mean for my audience today – foreign banks operating in the United States?

Christian Noyer: Central bankers’ dilemmas under uncertainty Speech by Mr Christian Noyer, Governor of the Bank of France, at a seminar in Buenos Aires, 5 June 2006. *  *  *  Ladies and gentlemen, •  Thank you for inviting me to this seminar. It is a great pleasure to address such a challenging theme, namely “Central Bankers’ dilemmas under uncertainty”. •  In the first part of my address, I will recall the nature of uncertainty and its importance for the central banker; in the second part, I will sum up proposals for addressing uncertainty. I  The nature of uncertainty  Uncertainty arises in many forms. It is crucial to central bankers in general (I/1) and maybe even more to the Eurosystem (I/2). 1)  The importance of uncertainty for the central banker  The relevance of risks and uncertainty for economic analysis was suggested in 1921, by Frank Knight (Risk, Uncertainty and Profit). “Risk” refers to situations where the decision-maker can assign probabilities to the randomness that he is faced with; “uncertainty” to situations where this randomness cannot be expressed in terms of probabilities. Uncertainty is crucial to central bankers: according to Alan Greenspan, “Uncertainty is not just an important feature of monetary policy; it is the defining characteristic of that landscape”. Thus, I will focus on monetary policy, although the topic is also relevant for financial stability, which is another important issue for central banks.
In particular, along with the adverse impact that the social distancing measures we may have to maintain in the future may exert on activity, there is a further effect. This is more difficult to measure a priori and relates to the possible and potentially persistent changes in agents’ behaviour in response to the “new normal”. These changes might include modified patterns of consumption and saving, or changes in supply chains or in certain aspects of firms’ operations. All these considerations would warrant qualifying the current recovery as uncertain, to take the second of the adjectives I used earlier to characterise this recovery. Additionally, from the standpoint of the sectors of activity, not all of them suffered on a comparable scale the consequences of the pandemic lockdown measures, as they are not equally susceptible to the imposition of social distancing measures. And the gradual startup in activity is not taking place at the same pace in the different sectors. The earlier normalisation of manufacturing and of certain services coexists alongside a slower than usual recovery in levels of activity in those other services, such as leisure and hospitality, where personal interaction is greater. Here, full normalisation is not likely to be attained until we have an effective medical solution. These differences in the pace at which normal levels of activity in productive sectors are being restored allows us to characterise this recovery as uneven, taking the last of my three adjectives.

That said, an improving path could be seen throughout Q2, in tandem with the ongoing gradual reopening of the economy. At present, then, we are witnessing an incipient recovery in the economy, which, however, is still incomplete, uncertain and uneven. The correlation of this economic activity during Q2 with the intensity of the restrictions on people’s movement in force at each point in time was very high. Thus, some indicators that measure people’s movements hit record lows in the first two weeks of April, with declines of around 80% in motorway traffic and fuel consumption, and of over 90% in the case of airport traffic. This was reflected in the high-frequency indicators of economic activity in the weeks in which the lockdown was stricter; then, for example, we saw reductions in electricity 1  consumption by firms and in consumer spending paid using cards of approximately 30% and 60%, respectively. For April as a whole, there was an unprecedented event in the time series when some variables fell practically to zero. This was the case of new car registrations and international tourist inflows, the latter variable obviously being closely related to the restrictions on personal movement. Since early May, and to a greater extent in June, the progressively staggered and regionbased easing of the lockdown measures prompted a gradual recovery in the mobility indicators and, in tandem, in economic activity indicators.
Interest rates will continue to be raised gradually ahead so that we can assess the effects of interest rate changes and other new information about economic developments. Thank you for the opportunity to present these assessments before answering questions. 12  BIS Review 47/2007

In contrast to the ECB’s two-pillar strategy, the SNB decided at the time to adopt an integrated approach. For the purpose of today's discussion, I would like to highlight two important elements of the SNB’s monetary framework. First, communication considerations were an important element in the design of the new framework. Clearly inspired by the early inflation targeters, a definition of price stability and a quarterly inflation forecast became the primary communication tools with regard to monetary policy. These were considered to be clearer than the alternative of attributing a specific role to monetary aggregates. In other words, the two pillar model of the ECB was rejected primarily on the grounds of communication considerations. Second, the new monetary framework was deliberately designed to allow sufficient room for judgment and flexibility in the conduct of policy. The inflation forecast as the main indicator for policy decisions is derived from a "portfolio" of models and indicators. Some of these models contain monetary aggregates; others don’t. The weights assigned to different models and indicators are allowed to vary over time as their reliability and applicability may also vary across different economic situations. Empirical studies backed the "portfolio of models" approach. Empirical evidence drawing on six years of Swiss data suggests strongly that combining inflation forecasts from different models and specifications improve the forecasting accuracy of the SNB’s inflation forecasts. 3 Of course, the SNB does not claim to have solved the fundamental problem of linking monetary and non-monetary analyses.
Hence the balance of financing sources will eventually have to shift. Policy makers have recognised the need for broader private sector participation. Long-term investors such as insurance companies, pension funds and sovereign wealth funds can be alternative sources of financing, as the life cycles of infrastructure assets match their long-term liabilities. However, these investors are not participating actively enough in the infrastructure space, especially in debt financing. I am sure we all recognise that there are many reasons including a lack of familiarity with the asset class and bespoke nature of infrastructure projects. Some see higher perceived political risks in Asia, and a limited range of investment instruments relating to infrastructure. To catalyse broader private sector participation to complement the traditional bank lending space, a few things could be considered. Firstly, we recognise that investors have varying risk appetites, and that the expertise to evaluate and undertake greenfield project risks still resides mainly with banks. Banks should therefore consider bringing in different types of capital at different stages as the risk profile of a project changes over time. For instance, transactions could be structured such that banks finance the construction stage of projects using their balance sheets, and the bank loan is then refinanced in the bond market post-construction. This way, institutional investors gain exposure to a steady stream of cash flows from operating projects, while banks can recycle capital to lend to new greenfield projects. There have been precedents in other parts of the world.

These are necessary to help countries achieve their economic growth targets in an equitable manner, resulting in job creation and other positive social outcomes. The real economy, financial sector and public sector players all have complementary roles to play. Conferences such as this are an excellent opportunity to bring together stakeholders in order to foster the exchange of ideas. On that note, I wish you all fruitful discussions today. Thank you very much. 4  BIS central bankers’ speeches
The optimal monetary response to a rise in credit spreads in their model strictly involves a less-than-full compensatory reduction in the policy rate, but is likely to be close to Taylor’s recommendation for reasonable calibrations of the interest-elasticities of saving and borrowing. 5  Buiter and Panigirtzoglou (2001) also discuss other, more exotic, approaches. BIS Review 111/2010  9  substitutability to exploit, purchases by the central bank can push up asset values, which in turn boosts aggregate demand and encourages increased issuance of the assets whose prices have risen. This rationale for asset purchases – that relative asset supplies affect asset prices and returns – dates back to Tobin (1969) and Brunner and Meltzer (1972). The mechanism is, however, absent from the canonical New Keynesian/New Classical macroeconomic model. That is because of a property akin to Ricardian equivalence: private agents internalise the budgetary implications of the public sector’s asset acquisitions, so that any change in the risk to which the private sector is exposed through its asset holdings is exactly offset by a compensating change in the risk borne by the public sector and thus ultimately the taxpayer through the public sector budget constraint (Eggertsson and Woodford, 2003). While this is a striking result, it is relatively easy to think of reasons why it might not hold in practice: any of credit market imperfections, limited asset-market participation or plain myopia is potentially sufficient.

This reduction in the perceived riskiness of the environment is also likely to encourage financial market participants to increase their holdings of riskier assets and to drive up their prices. A key piece of evidence suggesting that excessively loose monetary policy might have had a part to play in generating the preconditions for the crisis is provided by comparisons of policy rates with the policy settings generated by a benchmark Taylor rule (Taylor, 2007). Chart 1 shows the difference between the policy rate and benchmark estimates of the appropriate policy rate derived from a Taylor rule for the United States, the euro area and the United Kingdom. Notwithstanding the usual caveats about the construction of such benchmarks, the very low level of the Federal Funds rate relative to the Taylor rule from 2001 to 2005 in the aftermath of the collapse of the dot-com bubble is striking. Of course, the Federal Open Market Committee (FOMC) set its target Federal Funds rate at unusually low levels for a reason, namely concerns that the United States might find itself mired in deflation of the sort experienced by Japan during its “Lost Decade”. Bernanke (2010) provides a vigorous defence of Federal Reserve policy over this period, arguing that evidence from a comparison of guideline policy rates from conventional Taylor rules with actual policy rates is unpersuasive.
In both countries, an important driver of house price inflation over the period is house price shocks, though a wider range of influences appear to have been involved in driving the expansion in credit. The moral from these results would appear to be that although monetary policy may have played a role in fuelling the credit/house-price boom that preceded the crisis, it is rather more Rosencrantz than Hamlet. We return in Section 5 to the question of whether these findings suggest that policy should be set differently in future. The third point of note is the significant role played by shocks to macroeconomic volatility (blue bars), particularly in regard to credit growth, with noticeably more rapid expansion in credit taking place during tranquil periods. In particular, over the period 2002–5, macroeconomic volatility accounts for, on average, an extra 0.7 percentage points on US annual real credit growth and 0.5 percentage points on US annual real house price growth. In the United Kingdom, the corresponding effects are even larger: 2.1 percentage points on annual real credit growth and 2.0 percentage points on annual real house price inflation. A reduction in volatility also confers a sizeable “growth dividend”, suggesting that the stability of the Great Moderation period boosted the sustainable rate of growth, while the current period of high volatility has had the opposite effect; that is consistent with the cross-country evidence of Ramey and Ramey (1995), who find that higher volatility tends to be associated with lower growth.

This is primarily due to the lack of comprehensive and standardised information that is needed for all economic agents to factor in climate risk. I will come back to this need for standardisation later. But more fundamentally, the difficulties in pricing climate risk are due to the very characteristics of these risks, and in particular to what we call "green swans", which generate radical uncertainty and whose consequences can be systemic. vii In this respect, market neutrality – which guides the execution of our market operations – should not put a brake on carbon neutrality. viii Market operations are conducted in a neutral manner as long as they comply with the central banks’ risk control rules. And yet, climate risk is precisely a financial risk that is currently insufficiently measured by markets. ix Another difficulty is often put forward, but it can be overcome: the fact that climate risk is long-term, while many of our risk measures are short- to medium-term. Page 4 sur 8 This is a real technical challenge: the "probability of default" is usually one year; our economic forecasts cover a two to three-year horizon. We must therefore work to "lengthen" our measures, but the fact that a "tragedy of the horizon x" exists is not a call for a status quo. On the contrary! Climate change calls for early and resolute action as the benefits of corrective measures will essentially only be felt in the longer term. II. How should the central bank intervene? How can this be concretely achieved?