samchain/econo-pairs-v1 huggingface dataset:
Inflation measured in terms of the CPIF, in which mortgage rates are kept constant, is more stable but it is expected to be below 2 per cent for most of the forecast period (see Figure 8). My view of the situation At the latest monetary policy meeting, I advocated an unchanged repo rate and repo rate forecast. This was also the decision made by the majority. As in July, we also decided to offer our monetary policy counterparties loans at a fixed interest rate for one year. As I mentioned earlier, this can strengthen expectations that the repo rate will remain at the decided level throughout the maturity of the loans and also contribute to lower interest rates for households and companies in other ways. Many analysts felt that the decision to leave the repo rate unchanged was self-evident. The decision to retain the same repo rate path that we adopted in July was perhaps more unexpected. I will explain the reasoning that led to my conclusion that this constitutes a wellbalanced monetary policy. There are several factors to take into account in this decision. Perhaps the most obvious factor is the change in the economic prospects. As I mentioned earlier, the forecast for GDP growth in Sweden has been revised upwards somewhat. Irrespective of which indicators you look at, resource utilisation is still very low in Sweden and abroad and the development of employment is expected to be weak throughout next year.

And business needs a climate of stability if it is to commit to the investment that’s needed to revitalise an area. We know that it is entirely possible to transform old urban areas – there are plenty of inspiring examples from London Docklands to Berlin and Baltimore, and if Liverpudlians ever doubted it, nowadays they need go no further than Albert Dock. But it takes long term commitment. The key findings in today’s Merseyside Economic Review provide convincing evidence that Liverpool has turned the corner– with faster growth in the core city than any other English city and jobs growth more than double the national average. Manufacturing remains important and there is still a strong automotive supply industry, which is high tech these days, but the real growth sectors are tourism, leisure and modern services. Increasingly, for those who acquire the right skills, the jobs are there – a picture that fits with a national labour market where unemployment is now as low as it has been in three decades. How confident can you be that we will continue to deliver the stability that is our contribution to your future success? Our latest Inflation Report, published last week, paints a favourable picture for the next few years, with continuing steady growth and low inflation. If you trust the MPC to do its job, you might feel reasonably safe in basing your decisions on that outlook. But those of us on the Committee can’t afford to take it for granted.
The frequency distribution of the return on equity of large euro area banks (see chart on the left on slide 10) shows that the degree of dispersion among banks narrowed considerably in 2005. The banks with the lowest returns on equity managed to improve their performance, shifting the overall distribution to the right. Banks’ profits were also supported by the fact that the frequency distribution of loan impairment charges of large euro area banks, previously referred to as provisioning, shifted substantially to lower levels between 2004 and 2005 (as shown on the right-hand side of slide 10). Although this is an indication of an overall improvement in the quality of large euro area banks’ loan books, questions can be asked about the sufficiency of banks’ charges for expected loan losses should the credit environment deteriorate from the current very benign conditions. Regarding banks’ buffers for unexpected losses, on the other hand, the capital ratios for the same (large euro area) banks show that, in general, a greater proportion of banks exhibited higher capital ratios in 2005 relative to the previous year. The generally positive assessment of large euro area banks is complemented by a thorough analysis of risks related to interlinkages between banks. Special features B and C look at two different aspects of the relationships between banks: those running through extreme contagion channels and through earnings expectations.

In the most recently published inflation assessments, it was assumed that the price stability target was not threatened during the forecast period despite the growth of demand being so strong that use of capacity was under strain at the end of the period. The majority view of the Executive Board was therefore that there was no reason to increase the repo rate. This assessment was based on free resources in the initial situation, good productivity growth, low price increases on certain recently deregulated areas, low import prices and finally low inflation expectations. It is not per se strange that GDP can increase as much as 3-4% for a couple of years without inflation sharply accelerating, if the use of resources is low initially. If the pattern from previous cyclical upswings was to be repeated, price pressure should now increase. However, it has proven difficult to identify any exact and very stable correlation. As I mentioned earlier great changes have taken place in the Swedish economy. While there are still considerable deficiencies in competition in many areas, it is nevertheless not probable that inflation will accelerate strongly in the next few years. An important reason for this is that the price stability target has now  BIS Review 48/2000  4  obtained such strong support that inflation expectations are not increasing despite a cyclical upswing that is stronger than for a very long time.
Banks’s enforcement powers for  As a priority, we expect to strengthen the regulatory framework pertaining to all financial institutions, including licensed banks, licensed finance  violations of the Act and the Directions issued under it. In this regard, we wish to seek views from the banking sector as well. companies (LFCs), specialised leasing  In line with these reforms, we intend to  companies (SLCs) and primary dealers. It  review all key regulations in the medium-  will further ensure the stability of the  term. In this regard, we will review key  financial sector by promoting the safety  Banking Act Directions, such as share  and soundness of those institutions to  ownership, foreign borrowings, and  face unforeseen challenges in the  corporate governance, and these will be  growing business environment. amended where necessary. In this regard, the Central Bank wishes to  In order to maintain financial stability in  implement the following policies in 2017  the country and in line with regulatory  and beyond. reforms, we have identified the need for  Since the last amendment to the existing Banking Act in 2006, the banking sector landscape has undergone a significant  Central Bank of Sri Lanka – ROAD MAP 2017  further strengthening of the supervisory function of the Central Bank.

regulator of the financial system of Sri Lanka, we are making our best efforts to ensure stable economic conditions on a sustainable basis. Our policies aim at supporting the overall thrust of the government to promote investments, domestic and foreign, and enhance exports. To this end, we would be contributing through our efforts to improving the investment climate and facilitating trade, thereby  Central Bank of Sri Lanka – ROAD MAP 2017  33  creating the conditions to harness the  Priority needs to be attached to  benefits of the investment-trade nexus. equitable and inclusive growth, which is  In this context, I believe the initial impetus to harness the country’s considerable potential must come from the domestic private sector, particularly in the next year or two. The Megapolis Development Project as well as Master  key to achieving this objective. Hence, the Central Bank will continue its role in regional development to complement these efforts. Special attention will be paid to enhancing financial literacy as a means of promoting inclusion. Plans, that have been drawn up by the  I should also mention that the  government for the development of  government has announced its intention  Hambantota, Trincomalee and Kandy,  to restructure the Central Bank. We  and various regional development  would very much welcome a  programmes will open up tremendous  constructive restructuring process,  investment opportunities for both  which would upgrade processes and  domestic and foreign investors.
Following the approval of the budgetary stability law by Parliament, it is crucial that all the instruments envisaged in it, particularly the monitoring and control mechanisms and those aimed at ensuring that the targets set are met by all levels of government, be set in train immediately. I think it is worth looking more closely at this law because the success of the fiscal consolidation process depends largely on whether it is applied properly. The 2011 budget outturn highlighted the consequences of the unavailability of information, which prevented budget deviations from being detected in time and delayed the activation of mechanisms to ensure the consolidation targets were met. The new stability law should significantly improve the transparency of government action in at least three respects. First, it is essential for the budget outturn of local and regional governments to be published regularly, with the same periodicity, level of detail, lag and ease of access as that of the State. Second, the information contained in the State and regional government budgets must be improved, so that the assumptions underlying revenue and expenditure projections are known and the information is made available on these items in national accounts terms, which is the relevant definition for the existing fiscal rules. Finally, the information in the adjustment plans at the various levels of government should be made public and presented in a format allowing it to be analysed and compared with the initial budgets. In addition, the mechanisms obliging government deficits to be corrected have clearly proved to be insufficient.

For all that can be said, the current turmoil is a powerful manifestation of the risk and the complexities that could come with financial globalization. For me, the turmoil points to three important observations. First and foremost, it shows that financial turmoil can happen in any market regardless of whether it is large or small, or whether it is emerging or developed. Once the imbalance is allowed to occur, financial distress will likely happen and there is no exception to it. Second, the turmoil highlights the central role that the financial sector plays in a boom-bust cycle. First is the role that it plays as a mechanism that can contribute to and trigger a crisis. This is because a bubble usually cannot happen without excessive credit growth. Therefore, without proper regulation, a combination of strong capital inflows, easy credit, and the procyclicality of the financial system can set the stage for a build-up of serious economic and financial imbalances. The financial sector also plays an important second role in that its strength and resilience can significantly help cushion the real economy from the impact of external shock. The fact that a majority of emerging markets in Asia at this time have been in a better position to weather the first round impact of the turmoil, both the direct impact on banks and the impact on financial markets from de-leveraging and capital flow reversals, is a clear testimony to the importance of this second role.
And I also argued that price stability in the long run remained essential for economic success. That is why price stability is the central plank of the remit given to the MPC by the Chancellor. The other part of the remit makes clear that we are not expected to pursue 2% inflation in the short run whatever the cost – it recognises that attempting to hit the inflation target at all times may cause “undesirable volatility in output”. The remit overall has become known as “flexible inflation targeting”. It is a way of trading off output and inflation variability in the short run, while ensuring that inflation remains on track to return to the 2% target. Until the crisis, there appeared to be no real tension between hitting the inflation target and ensuring steady growth. More recently, we have had to make difficult choices. The MPC has looked through the impact of temporary external shocks and administered prices (including changes to VAT) on the level of CPI inflation and focussed on the level of domestically generated inflation in the market sector. Money wage increases have been low and stable. But CPI inflation has been above the 2% target for a long period. Should the MPC have taken action to bring inflation down? To do that would have meant driving down wages by creating a deeper recession, even higher unemployment and lasting damage to the job prospects of many young people.

If we embark on the type of programme I have outlined tonight, I believe we can roll back the black cloud of uncertainty darkening the outlook for demand, allow the rays of supply optimism to peer through, and sustain a recovery based on a successful rebalancing of the UK economy. The need to fix the banking system and introduce improvements to the future supply performance of the economy are, I know, felt even more keenly here in Northern Ireland than in Great Britain. And patience is a quality that has been demanded of you all in the Province over many years. The business community is the key to the prosperity of Northern Ireland. I wish all of you success in the challenges ahead. And I look forward to returning in a private capacity to enjoy the beauty of your Province. 6  BIS central bankers’ speeches
Bank Negara Malaysia also continues to use the tools at our disposal to ensure movements in the ringgit are orderly, in an environment of aggressive monetary policy tightening by the US Federal Reserve. The US dollar index is up 11.5% this year, its highest in two decades. Relative to the dollar, most major and regional currencies – including the ringgit – have depreciated. However, the ringgit has remained broadly stable when compared against currencies of our major trade partners. In fact, Malaysia's nominal effective exchange rate registered only a marginal depreciation of around 0.1%. In short, Malaysia’s economic recovery is well underway. That said, it is important to ensure - more than ever - that we secure our fundamentals, to strengthen our resilience against future crises and to enable the country to maximise its full potential. We need measures to address long-term vulnerabilities and boost our resilience against future shocks. We need to attract more quality investments that increase our economic complexity and create quality jobs for Malaysians. We need to embrace the sustainability agenda. We must also reform our subsidy system to be more targeted, and strengthen our social protection framework. Indeed, it goes without saying we need inclusive growth to bring about shared prosperity for all Malaysians. While targeted assistance remains in place to help segments of society that continue to deal with the lingering effects of the crisis, the economic and social costs of financial crime are especially harsh on these groups.

Financial System Conference – Dublin, 2 November 2022 Financial Regulation: A French Perspective  Speech by François Villeroy de Galhau, Governor of the Banque de France  Press contact: Mark Deen (mark.deen@banque-france.fr), Déborah Guedj (deborah.guedj@banquefrance.fr)  Page 1 sur 11 Ladies and Gentlemen, I am delighted to be here in Dublin, and I would like to thank warmly Governor Gabriel Makhlouf for the invitation to speak today at this Financial System conference. I have already had the pleasure of coming here four years ago, to talk about Financial Globalisation and more specifically about current account imbalances and the resulting financial vulnerabilities. These topics have faded into the background for some time as a result of the unprecedented succession of shocks and crises. But financial stability is obviously returning to the front stage in these turbulent times, putting to the test the reforms undertaken over the last decade, but also pointing to new pockets of financial stress. Against this backdrop, I will reflect on the possible end of a favourable decade for financial regulation and financial stability (I). I will then focus on the real estate sector – so sensitive here in Ireland – as a practical study case of the progress enabled by our regulatory and macroprudential toolkit (II). I. The end of a favourable decade for financial regulation and financial stability? a. Financial regulation It has now been fifteen years since the onset of the Great financial crisis – no need to recall the social, economic and financial damage incurred. But lessons were learned.
It has soared above 200 twice: for two months in 2011, coincident with that year’s debt-ceiling debate, and in December 2012, when a compromise implementation of sequestration was being hammered out. It’ll be interesting to see what happens with the index in the wake of the past week’s developments (or lack thereof) in Washington. The point is that starting with the collapse of Lehman Brothers in September 2008, economic policy uncertainty has been consistently high, and half the time it has been extraordinarily high. It’s difficult to prove “beyond a reasonable doubt” that this elevated uncertainty is causally related to the weak recovery we’ve experienced. But the hypothesis is surely sensible, the timing is certainly auspicious, and enough careful confirming analysis has been done to say that the preponderance of evidence favors the proposition that not just recent policy decisions, but also the manner in which those decisions were arrived at, have been a significant hindrance to economic expansion. The Kinky Stuff: monetary policy As to monetary policy, I would submit there are several links between monetary policy and economic uncertainty. First, though, some background. Ordinarily, monetary policy works by influencing the current and expected near-term levels of short-term interest rates. Once short-term interest rates hit zero, however, the Fed turned to unconventional policies. By using massive purchases of longer-term Treasuries and agency mortgage-backed securities, these policies helped hold down term premia and support the housing recovery.

And I’m talking about the new, difficult to replicate $ bill that will be released next Tuesday. Please join me in welcoming John Taylor to the podium. 8  For more information about tightening control of inflation expectations by putting a five-year inflation rate, in place of the usual four-quarter inflation rate, in the Taylor rule, see “All in the Family: The Close Connection Between Nominal-GDP Targeting and the Taylor Rule,” by Evan Koenig, Federal Reserve Bank of Dallas Staff Papers, No. 17, March 2012. 6  BIS central bankers’ speeches
This broad flexibility within our statutory legislation (which came into force in 2004) proved to be a huge advantage during the crisis, also by comparison with other central banks. For instance, we were quickly in a position to issue our own debt certificates and develop a large market for them. We do not use these SNB Bills because we need money. They are used to absorb excess liquidity in the money market. Second, our independence is not unconditional. With the privilege and duty of independent action comes a particular responsibility. And whoever bears responsibility in our democratic constitutional state must be accountable for his or her actions, for the means chosen and the results achieved.6 Consequently, under article 7 of the National Bank Act, we maintain a regular exchange of information with the Federal Council, and the SNB and the Federal Council inform one another of decisions that will have a significant economic or monetary impact. This is important for us, because it ensures that we are familiar with the fiscal political framework within which we conduct our monetary policy. Nevertheless, each body retains full  4  Cf. also Message on the revision of the National Bank Act of 26 June 2002, FF 2002 6107 to 6109. 5  Together with the possibility of re-election, this helps to set the incentives for members of the Governing Board in a way that ensures that long-term fulfilment of the statutory mandate is also in their individual interest.

Thus, price stability is the main objective of monetary policy in all of these countries and has in fact become the recognized single target for monetary policy in numerous countries. The reason for this emphasis on price stability is that it creates the best conditions for balanced growth and increased welfare. The Icelandic financial market has developed very rapidly over the last ten to fifteen years. It is a small market by definition, but has nevertheless the same institutional set-up as larger industrial countries. Aside from the Central Bank, these include commercial banks, savings banks, securities companies, various investment funds, insurance companies, large and important pension funds and last but not least a stock exchange - linked with the other Nordic exchanges - where the shares of 60 to 70 Icelandic companies are listed and traded on regular basis. Supervision of the activities of all of these institutions is in the hands of a unified financial supervisory authority that has broadly the same legal powers and follows the same methods and standards as supervisory agencies in other European countries. Important rationalisation has taken place in the Icelandic financial system. Until a few years ago, two of the main commercial banks were fully government owned and so were a host of so-called investment credit funds. The funds were unified in a single institution, which was subsequently privatised.