samchain/econo-pairs-v1 huggingface dataset:
Accordingly, should unhealthy price formations arise due to loss of depth in the FX market, we can resume FX selling auctions or directly intervene in the FX market without undermining the basic principles of the floating exchange rate regime. In addition, depending on the global economic developments, we may resume intermediary activities in our FX Deposit Market with the aim to enhance FX liquidity flow in the interbank FX market. Lastly, I will briefly mention the issue of financial stability. We can summarize the core objective of the policies we have been implementing since November 2010 as slowing down the excessively rapid growth of the private sector’s external liabilities and improving the quality of these liabilities. Accordingly, the downward trend in the seasonally adjusted monthon-month current account deficit, which started in July 2011, will continue in the final quarter after a pause in September 2011. The steady rise in the shares of direct foreign investments and long-term borrowing in the financing of the current account deficit continues. We believe that further slowing down of the current pace of growth, especially in consumer loans, in the rest of the year would contribute to the sustainability of the rebalancing of domestic and external demand. Thus, the rise in the private sector’s propensity to save in Turkey will ensure a more rapid and sound correction in the current account deficit. In the upcoming period, effective liquidity management through the interest rate corridor will become an important policy instrument that will also contribute to financial stability.

Besides acting in a countercyclical manner, in order to preserve the consistency and the sustainability of real convergence, monetary policy should also be flexible while avoiding extremes. On one hand, it should by no means ignore the threat of inflation for the sake of fast and easily gained (and therefore illusory) prosperity. On the other hand, it should avoid becoming, in Mervyn King’s words, an “inflation nutter”. With this philosophy, back in 2005, the National Bank of Romania decided to adopt a “light” version of inflation targeting, as monetary targeting had to be abandoned mainly due to the broken relationship between monetary aggregates and inflation. Light inflation targeting was deemed more suitable than any other monetary policy regimes for sustainably achieving price stability, while limiting the cost of excessive volatility in output and employment. A peg was not a feasible option, since exchange rate flexibility was seen as an asset for an economy as big and rigid as Romania was at the time, especially given the widening external imbalance and the upcoming stages of capital flows liberalisation. We focused our monetary policy strategy on the medium-term achievement of the inflation objective rather than on hitting the target as fast as possible at any costs. This strategy has been supported by a managed floating exchange rate, which proved to be a highly effective alternative to free floating in cushioning the economy from the impact of sizeable capital flows.
Many of those assets remain impaired and are being run off or sold off where possible, negatively impacting banks’ lending figures. And given the losses suffered by most banks on these portfolios, there is a natural reluctance to increase lending to that sector again. One reason we’ve not yet seen a significant expansion in total lending is  10  BIS central bankers’ speeches  that banks have tightened their credit assessment criteria since the crisis and have not changed them following the launch of the FLS. Some borrowers will find that frustrating. But from the banks’ point of view it is a prudent thing to have done, so they don’t get back into the troubles they were in before. Chart 7 Net lending by FLS participants(a)  (a) Net flows of sterling lending to UK households and private non-financial corporations. Non-seasonally adjusted. (b)  The sum of net lending by those participants with positive net lending during the quarter. (c)  The sum of net lending by those participants with negative net lending during the quarter. When considering the corporate lending numbers, it is important to remember that many companies (particularly large firms) are making increased use of capital markets to raise finance. Bond issuance by UK businesses remained strong in 2013 Q2, following a Q1 figure which was the highest since 2009 Q2.

After the adoption, last December, of a sustainable taxonomy, sustainable reporting is actually the next critical step ahead of us to mainstream green finance. I am looking forward to the report the EFRAG is currently preparing to address this issue [report to be published on 31 January 2021]. We should indeed strive to design our own framework for non-financial data, which meets our own needs (which means, for instance, integrating the ambitious concept of double materiality). It is a European responsibility, and a public one: we cannot just leave it to private bodies, at the global level. We should be committed to make our common framework operational and easy to transpose. We Europeans would then be in a position to inspire potential international initiatives aiming to produce a global sustainable reporting framework, and then make sure that the EU standards are widely recognised. Such a necessary endeavour for the EU also has domestic grounds: we will have to implement the new article 29 of the “Loi énergie et climat”, which will replace article 173. I dearly hope that, the ACPR and the French Treasury together, we can use the decree scheduled for early next year to strengthen harmonisation along the lines of the European standard that is to come. If not – but that would be a second best – we should at least ensure a French comparability. *** I have insisted on what we can do, must do, and will do: regarding supervision, monetary policy, and the harmonisation of financial disclosures.
In view of the far reaching implications of any reform agenda, it is an important global responsibility to ensure that the reforms achieve their intended results and that this new phase of globalisation will result in a more inclusive international financial system that will allow for the effective participation in the global economy and international financial system regardless of size or stage of developments. On the specific regulatory reforms to address the issues and problems that caused the crisis, of importance, is that the goal of such regulatory reform should not be overlooked – promoting financial stability is a means to an end and the ultimate goal is to achieve sustainable growth and development. Many have already highlighted the potential increased regulatory costs on intermediation and hence on economic activity. This is even more relevant in Asia where there is greater reliance on the banking sector for financing. The efforts undertaken to comprehensively assess the macroeconomic impact including by the IIF is highly relevant and will be important to the reform process. A further concern and one that is less discussed is on the implementation of the regulatory reform. With greater capital mobility across borders, the stricter regulations could result in the migration of financial business to less regulated market segments, institutions or financial centres. Important to this is the need for the development of the framework for cross border policy coordination and resolution.

And with particular reference to the new capital framework, the Commission has chosen to address key elements of supervisory cooperation within the proposed directive, and has adopted an approach that strikes me, as a European supervisor, as a step in the right direction. Secondly, from a practical perspective, the work already done by the Committee of European Banking Supervisors - CEBS - is very encouraging. This committee, directly charged with promoting co-operation and convergence of supervisory practices, has a key role to play in the implementation of the new capital framework in Europe, for example in finding practical ways to apply the provisions which provide for an enhanced role for the consolidating supervisor, and on model approval processes. And it is already producing tangible results - for example in designing a framework for public disclosures by supervisors on Basel II, and preparing a common framework for institutions to report their solvency ratios. For these reasons, I believe that we as supervisors can go further than others may be able to go in our efforts to ensure consistent implementation of the new capital framework and effective supervision on a cross-border basis. We can deliver results on a number of fronts, including the specific initiatives I have just mentioned. I think that by making rapid and real progress, we can also promote greater convergence beyond the EU, as others may find our experiences of benefit to the wider search for greater international consistency in the implementation of Basel II. 4.
Second, real interest rates must also be increased with a view to removing the causes behind the differentials. BIS Review 14/2001  5  Interaction with fiscal policy It is important that the annual budgets are based on a long-term strategy that takes into account possible fluctuations in oil revenues from one year to the next. With large and, to some extent, varying budget revenues, the basis for determining central government expenditure and taxes from one year to the next may easily be impaired. If budget spending is allowed to vary in step with oil prices, the Norwegian economy may experience abrupt shifts and instability. Changes in oil prices may then quickly influence wage and price expectations, the exchange rate and long-term rates. In addition, short-term rates would have to be changed frequently and sharply. Budget tightening and spending growth Percentage change from previous year 3  3  Spending growth  2  2  1  1  0  0  -1  -1  Total effect of the budget  -2 93  94  95  96  97  98  99  00  -2 01  In recent years, central government real underlying spending growth has accelerated somewhat. Both in 2000 and 2001, spending growth has been higher than 2 per cent, which is above potential growth in the mainland economy. At the same time, taxes have increased.

The Bank of England, which was established in 1694, was controlled by the Crown’s creditors. This limited the Crown’s scope for printing money freely. Acemoglu and Robinson maintain that the Glorious Revolution paved the way for the Industrial Revolution.14 The monetary system A man who makes pins on his own can make between one and 20 pins a day. However, if the work is distributed among several workers such that one produces the wire, another straightens it, someone else cuts it to size, yet another sharpens it, and so on, ten men can produce 48,000 pins per day. This is Adam Smith’s famous example, taken from The Wealth of Nations, of how the division of labour is important for productivity and economic prosperity.15 In Smith’s example, all the operations take place within a single factory. But in a more complex society, one firm’s output is another firm’s input. An important prerequisite for such division of labour is that there are institutions that facilitate simple trading of what is produced. The monetary system is an institution that simplifies trade in goods and thereby promotes the division of labour, productivity and economic prosperity. We must bear in mind that money and the monetary system are not a goal per se. Money is like oil in the machinery. Nevertheless, of all the systems existing within a state, the monetary system is among the more mystical when examined closely. Historically, the King issued money, initially in the form of coins.
In doing so, they should exert utmost care not to make wrong or spurious judgements and give false alarms about an impending catastrophe in a central bank. To do their job effectively, auditors should be more knowledgeable of the technical side of the operations of a central bank than its internal technical staff. Moreover, they should arm themselves with knowledge of how other central banks are operating, how some central banks had got into difficulties due to irresponsible behaviour and the emerging global best practices of central banking. Hence, it is a continuing learning and knowledge enhancement process for auditors of a central bank. By any measure, this is not a simple challenge. 2  BIS Review 58/2009  It is only with this superior knowledge base that auditors acquire the capability of making a proper risk assessment of a central bank and play their new role as a “risk-alerter” to the management and legislators. This requirement equally applies to both internal and external auditors of a central bank. The major risks faced by a central bank The policy failure risk, (that is, the inability to maintain the stability of the value of the currency on a continuous basis) and the associated reputation risk (that is, the public no longer trusts the central bank and its action) of a central bank are well known. But, a lesser known risk of a central bank is the “insolvency risk” which could loom over a central bank with or without the presence of the policy failure risk.

We have tried to delegate more matters more specifically to the heads of department, leaving them to run the operations and provide continuity and competence. At the same time, the number of departments has been reduced so as to have an organisation that is less top-heavy. The Executive Board's responsibilities have been shared out among the members. That does not mean that we are to manage day-to-day operations, which is a matter for the department heads. Our task is to act instead as a source of support and dialogue. The internal management and the way we handle monetary policy are interconnected. An arrangement with reservations and so on could lead to a polarised picture in the media and that in turn could have repercussions on the internal work. Even though we do not see any differences of opinion as something unnatural, others may do so and that might make it difficult to avoid splits in the organisation. In this respect I think we have been broadly successful. At times the media have presented a dramatic scene with major differences of opinion but with the passage of time we seem to have become less and less newsworthy. At the same time, we have handled the system rather carefully and abstained from arguing with each other. That I thing is wise because the system is rather fragile. BIS Review51/2001  3  Let me conclude by referring back to my opening remarks.
They enhance the public’s understanding of what central banks do and why they do it. Sovereign wealth fund The SNB’s balance sheet has expanded sharply since 2008. It is this growth that inspired the idea to set up a sovereign wealth fund to manage the SNB’s foreign exchange reserves. A number of different options are being proposed for the structure of the sovereign wealth fund. Although proponents’ goals differ quite considerably, they all draw parallels with the sovereign wealth funds of countries such as Norway. However, comparisons with Norway are misleading, since this country supplies its sovereign wealth fund with tax revenues, licence fees and dividends from the oil sector. When companies in a country discover new natural resources, the country becomes richer as a result of the revenue generated and its wealth increases. By contrast, the exceptional growth in the SNB’s balance sheet since 2008 is primarily attributable to foreign currency purchases based on monetary policy considerations. We bought foreign currency in order to limit the appreciation of our own currency, thereby putting more Swiss francs into circulation. Such an expansion of the money supply, however, does not create any real value. This difference between oil revenues and foreign exchange reserves is important when contemplating setting up a sovereign wealth fund. Norway is able to transfer oil-sector tax revenue and other receipts into its sovereign wealth fund, because they constitute profit for the country as a whole. The SNB’s foreign exchange reserves, however, do not represent profit.

Thomas Jordan: The rationale for discontinuing the minimum exchange rate and lowering interest rates Introductory remarks by Mr Thomas Jordan, Chairman of the Governing Board of the Swiss National Bank, at the press conference of the Swiss National Bank, Zurich, 15 January 2015. *  *  *  Ladies and gentlemen Thank you for once again accepting our invitation to this press conference at such short notice. Let me begin by explaining the rationale for discontinuing the minimum exchange rate and lowering interest rates. Afterwards, I shall be happy to answer your questions. Discontinuation of the minimum exchange rate The Swiss National Bank (SNB) has decided to discontinue the minimum exchange rate of CHF 1.20 per euro with immediate effect and to cease foreign currency purchases associated with enforcing it. The minimum exchange rate was introduced during a period of exceptional overvaluation of the Swiss franc and an extremely high level of uncertainty on the financial markets. This exceptional and temporary measure protected the Swiss economy from serious harm. While the Swiss franc is still high, the overvaluation has decreased as a whole since the introduction of the minimum exchange rate. The economy was able to take advantage of this phase to adjust to the new situation. Recently, divergences between the monetary policies of the major currency areas have increased significantly – a trend that is likely to become even more pronounced.
And there’s some especially good news to report from the Capital region’s manufacturing sector: jobs are growing, and growing quite strongly – a testament to the success of the area’s burgeoning high tech sector. Since the recovery began, the area has added over 4,000 manufacturing jobs, many of which are tied to computers and electronics. That’s an increase of nearly 25 percent. This pace of job growth is four times as great as the national pace. In fact, there are now more people employed in the Capital region’s manufacturing sector than before the recession. Not many places can say that, and this is certainly not true for the nation as a whole. In part, the success of local manufacturing reflects the presence of strong partnerships between industry and higher education. These cooperative arrangements, which help in the creation, development and commercialization of new products and processes, drive innovation and put local companies at the leading edge of technology. Moreover, these partnerships directly support local jobs. Not only are students gaining real world experience by working in shared facilities while they are in school, but strong connections between local businesses and higher education institutions help workers train for jobs that are available, and help employers find the skilled workers they need. During my last trip to the region, I saw firsthand how universities and companies can successfully work together during my visits to the State University of New York Nanotech Center and the production facilities at Global Foundries.

We plan these trips so I can meet with a diverse array of representatives. This allows me to get a comprehensive picture of economic conditions in the region and a fuller understanding of the major issues and concerns. This is our fifth trip to Upstate New York in the past few years. Other recent trips have taken us to Northern New Jersey, the boroughs of New York City, Long Island and Fairfield County, Connecticut. My outreach trips complement the ongoing efforts of the New York Fed to assess conditions in the Upstate New York economy and throughout our District. We monitor economic performance on a monthly basis through special indexes we have created and through our monthly surveys of New York State manufacturers and business leaders in the nonmanufacturing sector. We also get important input on economic conditions from our Upstate Advisory Board, whose members play important roles in the Upstate economy. We conduct a biannual poll of small businesses to understand their credit needs and availability. The results of one particular poll led us to develop a series of clinics for small businesses to help them take the next step to access capital and identify new sources of funding. We have constructed a consumer credit panel that allows us to better understand the financial condition of U.S. households and students. More recently, we extended this national analysis to include more detail about the states in our district, including a profile of households in New York State and the Albany area.
If there is no evidence of misalignment, and the issue is simply about hoarding reserves, the probability of the intervention having any effects on the exchange rate is smaller, while the possibility of incurring in quasi-fiscal costs increases. The Chilean experience last year was in line with the aforesaid principles. It was done in a moment where there was clear evidence of misalignment with respect to the levels consistent with long-term fundamentals. It was also totally consistent with the inflation objective, and started at a moment – April 2008 – in which there were rather benign inflation figures that revealed a smaller risk of unwanted inflationary propagation. Towards midyear it was even possible to raise the interest rate substantially to tackle an inflation rate that was much deviated from the target. This was thanks to the fact that the purchase of dollars was being carried out mechanically and despite a significantly depreciated exchange rate after the intervention. The purchase of foreign currency was concluded prematurely due to global tensions in global liquidity in dollars in September of last year. The capacity of the Chilean economy to subsequently deal with a significant exchange rate depreciation scenario, with monetary easing prospects and reduced inflationary pressures is proof that there was no inconsistency between the decision to intervene and the conduct of monetary policy (Figure 4). Intervention can occur only under special circumstances, because it is not easy to assess whether the prices of domestic assets are really in a bubble.

One such reason is the central bank’s responsibility for the stability of the financial system. If asset prices have been driven up to unsustainable levels that do not correspond to the underlying fundamentals, we are faced with a special kind of problem. We know from experience that speculative asset price bubbles eventually burst. When they do, collateral values will fall and balance sheets deteriorate, potentially threatening the stability of the banking system. To avoid this kind of development, the central bank needs to closely monitor the potential for excessive credit growth and the possibility of asset price bubbles building up. It seems that historically the forming of speculative price bubbles has been closely linked to an excessive expansion of credit. But we need to operationalise both the concept “excessive” and the difficult concept of an asset’s “fundamental value”. As history has shown us, judging to what extent rising asset prices reflect strong fundamentals, rather than the “irrational exuberance” of investors, is easier said than done. How does a speculative asset price bubble get started and how do we spot it? And if we spot it, what do we do about it? In most countries the risks associated with a property price bubble would probably be considered to be greater than in the case of an equity price bubble. This is because in most countries banks are more exposed to risks in the property market, since real estate is used as collateral for a considerable amount of bank loans.