samchain/econo-pairs-v1 huggingface dataset:
Towards midyear it was even possible to raise the interest rate substantially to tackle a surprise rise in inflation that was much deviated from the target. This was so thanks to the fact that the purchase of dollars was being carried out mechanically, 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, 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 2). It also shows that the flexible exchange rate regime adopted early this decade has the economy well prepared to absorb exchange rate fluctuations without the turmoil that used to come with them in the past. 4. Bubbles, exchange rates and capital inflows in emerging economies  Latin America went through a period of large capital inflows in the first part of the 1990s (Calvo et al., 1996). We cannot disregard the possibility that after the current crisis is over, there will be a reemergence of inflows to emerging economies. Therefore, there could be strong pressures for a sharp increase in the valuation of domestic assets, with a potential bubble in their prices, and this bubble could take the form of an exchange rate appreciation.

4  BIS Review 113/2009  To begin this discussion, I should emphasize that capital inflows to capital-scarce economies are a good thing. We know that capital flows to institutionally strong economies are beneficial (Prasad et al., 2002). Therefore, the role of policy is not to impede capital flows, but to avoid the creation of a bubble in domestic assets with consequences on resource allocation. 5 In this regard, to have in place sound prudential regulation during periods of abundance of capital is essential for financial stability, as we are reminded by the crisis in Chile in the early 1980s, the Mexican crisis of the mid-1990s, the Asian crisis, and more recently, the crisis in Eastern Europe. Even if one could accept that monetary tightening could be an appropriate response to combat an asset price bubble such as the recent housing price bubble, with all the caveats I discussed before, the problem is more acute in small open economies. Tightening monetary policy may have perverse effects, since it induces further capital inflows and strengthens the currency. In this case, the interest rate is not the most adequate instrument with which to burst the bubble.
Thus the fear that our large balance sheet and the large stock of reserves in the banking system will cause inflation – either now or down the road – seems misplaced to me. While we have been experiencing disinflation generally, it is not the case for all prices. As Figure 13 shows, some prices have risen rapidly. Energy prices in particular have been rising, in response to robust growth in emerging markets. But outside of energy prices, most prices have shown little increase, and in fact a number of the major categories in the CPI index have experienced declines in prices. To be clear, the Fed certainly cares about increases in energy prices, for two reasons. First, higher energy prices could potentially bring about long-lasting increases in the overall inflation rate. The Fed therefore monitors energy prices closely, given our mandate to keep overall inflation low and stable. Second, rising energy prices act as a tax on households and businesses, who often find it difficult to reduce their consumption of energy in the short run.4 With regard to the first concern, our research suggests that the lasting effect of energy prices on overall inflation has been surprisingly small in recent years. For evidence, consider the enormous surges in oil prices in mid-2008, which were followed by significant declines in core inflation, as I mentioned earlier. 4  The first effect would lead Fed policy to be slightly less accommodative while the latter effect would lead it to be slightly more accommodative.

Let me focus in the minutes I have at my disposal on several economic issues. Our debate is so more important for it takes place at a time of some economic slowdown all over Europe and of an erosion of multilateralism, of spreading trade conflicts. The prospect of a hard Brexit is very annoying for all of us and I still very much hope that such a denouement would be avoided. Likewise, it is high time to strike a deal on the Multiannual Financial Framework so that the great challenges the Union is facing (protection of borders, cyber fare, climate change, conflicts in near and more remote neighborhoods, etc.) find proper conciliation with the need to preserve the cohesion of the Union and avoid further fragmentation. I also trust that EU leaders will find the right balance to address key institutional and policy related weaknesses of the Euro area. I mention this, for Romania, like other Non-member States, is bound by EU accession treaties to join the single currency area eventually. And hopefully, this will happen in the not too distant future. In this regard I wish to mention that two major documents on Romania’s path to the Euro area (an analytical report and a Plan of action) have been recently completed and have been subjected to the scrutiny and approval of the political parties and the Parliament. I was one of the vice-chairs of the National Commission which guided the completion of the two documents.
Thirdly, structural analysis suggests that agents assign less importance to past inflation trends – one of the factors that determines the persistence of inflation mentioned above – in the euro area 14 than they do in the United States. Moreover, it is important to highlight the fact that not only has there been less inflation variability in the euro area compared to the United States, there 15 has also been less variability in economic growth. And, contrary to popular belief, the euro area’s greater stability has not been achieved to the detriment of its growth, which in per capita terms has been broadly the same as in the United States for the past ten years. The same is true regarding the creation of new jobs, with 17 million new jobs having been created since the euro was first introduced. Thus it is incorrect to argue, as people often do, that the stabilisation of inflation in Europe has damaged economic growth. 3. Budget policy  The differences between the European and US budget policies can be attributed to a combination of factors including: the political-cum-institutional setup, the general public’s preferences regarding the role and size of government and the structure of the economy in the broader sense. Just like monetary policy, so also budget policy in Europe appears on the  12  Bernanke, B. (2006), “Semi-annual Monetary Policy Report to the Congress”, 15 February 2006. 13  See Ehrmann, M. et al.

On the other hand, however, there appears to be a threshold beyond which this ratio evens out or even starts to go the other way. Indeed it has been estimated that an increase in the size of government has a negligible and marginal impact on income variability if government spending exceeds 40% of GDP. 26 Moreover, recent figures tend to suggest that the negative correlation between government size and income variability appears to have decreased since the 1990’s, and thus the role of budget stabilisation policies in attenuating fluctuations in consumption has also diminished. 27 Fiscal multipliers appear to have decreased over time (and may even have gone below zero) both in the United States and in the euro area countries. 3.5  Preferences  Finally, the different level of fiscal activism in the United States and the euro area can be ascribed to the general public’s preferences, which are then mirrored in the budget authorities’ decisions. People often argue that the Europeans are more averse to inequality than the Americans, and that this has led to a higher level of fiscal redistribution in Europe. People’s attitude toward inequality may well be influenced by their expectations of social mobility. Even though income mobility in the United States is not particularly high, several statistics 28 show that the “American dream” ideal continues to have a major psychological impact on people at the grassroots level as well as on the country’s political choices.
Second, through the most recent economic downturn, our policy rate has been lowered to 1.5 percent, a quarter percentage point above the historic low level of 1.25 percent implemented in 2009 immediately after the peak of the Global Financial Crisis. This was done with the aim to stimulate economic recovery. We now have limited “monetary policy space” to act should unexpected adverse economic conditions emerge. In very much  4/5  the same way that our foreign reserve build-up in times of capital inflow allows us room to conduct a diverging monetary policy and smooth out sudden capital outflows as we have seen these past months, building up some policy space for the future should be a prudent consideration. Ladies and gentlemen, With the ample external buffers we have built up, Thailand so far has the autonomy to deliberate our own monetary policy. I have outlined for you the main factors that the MPC considers: inflation, growth, and financial stability. We expect this year’s headline inflation to be in the target range, albeit around the lower end. In the longer run, however, structural changes and their effects on inflation dynamics will need to be taken into consideration when deciding an appropriate monetary policy framework. Concerns over the economic recovery have lessened over the last few quarters as the economy has made a clearer recovery with a more balanced growth. Nonetheless, certain risks to the growth outlook remains, and monetary policy still plays a role in supporting a more robust growth in domestic demand.

That is to say, gradually reducing the sizeable volume of public debt that will arise because of this crisis is feasible, provided we have an appropriate consolidation programme. This programme should include a clear definition of the budgetary objectives and their timeframe, along with details of the measures needed to attain them. It should also be based on a prudent forecast of macroeconomic developments and include a suitable response to possible slippage. It is in the political sphere that the details of this programme must be decided, incorporating social preferences about the level and composition of public spending and revenue. In any event, it should be compatible with an improvement in the quality of public finances. 10  In this connection, it would be a priority to subject the various items on the expenditure side to an exhaustive review, in order to identify those areas with room for more efficiency. It is important that the recommendations stemming from the AIReF’s assessments be taken into account forthwith. A comprehensive review of the tax system is also in order, to improve its revenue-raising capacity and its efficiency. Comparison with the other European countries can offer guidelines here. And, once again, the findings of AIReF’s ongoing review of tax benefits will provide a significant contribution. Finally, in a country as decentralised as Spain, it is vital to be able to count on the collaboration of the regional and local governments in the design and implementation of the consolidation programme.
Unemployment is therefore decreasing, though it is still above the levels that were customary in earlier decades. So the situation before us today is completely different from what we experienced last autumn. During the past year, Sweden’s economic prospects have changed considerably in the eyes of various observers and the Riksbank has been no exception in that respect. Monetary policy in the past twelve months Last autumn the financial markets became increasingly turbulent in connection with, for example, problems arising from the hedge fund Long Term Capital Management and the suspension of Russian debt payments. The financial crisis was expected to add to the negative real economic effects of the Asian crisis. International observers, including the IMF and the OECD, therefore revised their global growth and inflation forecasts downwards. The Riksbank did the same. Although growth in Sweden’s domestic sectors was relatively good and the exchange rate tendency remained weak, the overall picture did point to slacker growth and lower inflation in the forecast period. In November and December the Riksbank therefore reduced the repo rate from 4.10 to 3.40%. The early months of this year were marked by continued repercussions of the Asian crisis in the world economy, with weaker international demand. In order to prevent this from leading to a dampening of economic developments in Sweden and an even lower rate of inflation, in February and March the Riksbank reduced the repo rate in two more steps to 2.90%. Since then the situation has stabilised.

Benoît Cœuré: Why the euro needs a banking union Speech by Mr Benoît Cœuré, Member of the Executive Board of the European Central Bank, at the conference “Bank funding – markets, instruments and implications for corporate lending and the real economy”, Frankfurt am Main, 8 October 2012. *  *  *  I would like to thank Carmelo Salleo for his contribution to the speech. I remain solely responsible for the opinions expressed herein. Introduction Ladies and gentlemen, It is a great pleasure to be here with you this evening as part of this conference. I firmly believe that good research underpins policy choices and, as you know, the European Central Bank (ECB) is very committed to carefully conducted, high-quality analysis as the bedrock of its decision-making. Bank funding has been the focus of policy-makers’ concerns for the past few years, ever since the collapse of Lehman Brothers, which brutally reminded us all of the systemic dimension of liquidity and funding risk. Such a cataclysmic event elicited a host of responses, ranging from central bank interventions to prevent a meltdown of the financial system to the design of new regulations to limit risk-taking by financial institutions. The shock was global – and the response has been global. However, much work still needs to be done, so I welcome opportunities such as this conference to gain a better understanding of the dynamics and determinants of bank funding and of their implications for the financial system and the real economy.
Woodford’s (2005) formulation: ” For not only do expectations matter, […] very little else matters.”  BIS Review 110/2009  1  Criteria for a “good” interest rate path Inspired by Svensson, Norges Bank has developed a set of criteria for a “good” interest rate path. The intention is to make it easier for others to understand how we think, although the criteria also define the agenda for the internal discussion. 2 The first criterion for a good interest rate path is to set the interest rate with a view to bringing inflation back to target in the medium term following a shock. The primary objective is to achieve the inflation target. The second criterion reflects the flexibility of inflation targeting. There are many routes to the objective. Which one should we choose? According to the criteria, emphasis should be placed on finding an interest rate path that also stabilises output and employment. So far, our approach tracks Svensson’s theoretical approach fairly closely, with some deviation from the analytical method he presents in his article. The most important difference is that we have chosen to focus directly on the target, using a loss function to describe monetary policy. The approach proposed in the article primarily relies on a description of policy under different rules followed by calculation of the loss using the loss function. Because the model is primarily a model and reality is primarily reality, some tailoring is required to connect model and reality. Some additional criteria have therefore been formulated.

In particular, the rapid surge in prices over the last year, has been brought under control and inflation has been declining in recent months, through easing the pressures on household' budgets and reducing uncertainties for enterprises. At the same time, the banking sector appears sound, indicators on the stability of both public and external debt have been improving, the financial environment is calm, and enterprises and households' balance sheets remain solid. These achievements are not a result of chance. They reflect, among other things, adequate and coordinated monetary, financial and fiscal policies and the results of continuous structural reforms which we have undertaken in the financial sector. The proportional and timely reaction of these policies has minimised the immediate consequences of shocks and has safeguarded the production capacity of Albania. In parallel, continuous structural reforms have strengthened the flexibility and resilience of the Albanian economy, by helping both the monetary and financial stability of Albania. 1/8  BIS - Central bankers' speeches  In my remarks today, I will provide an overview on the main directions of the Bank of Albania's work throughout 2022 and its results. I would then like to share a brief summary of our expectations and highlight some of our primary objectives for 2023. ***  1. The outlook for the economy, price stability and the Bank of Albania's monetary policy The global geopolitical and economic environment experienced upheaval in a radical and unexpected manner at the outset of 2022, due to the Russian unjustified invasion of Ukraine.
Mugur Isărescu: Convergence towards euro enlargement Opening speech by Mr Mugur Isărescu, Governor of the National Bank of Romania, at the European League for Economic Cooperation’s (ELEC) Monetary Conference, National Bank of Romania, Bucharest, 4 June 2019. * * * As prepared for delivery Your Excellency Baron Snoy, Dear members of ELEC, Ladies and gentlemen, It is a pleasure for me to open this ELEC Conference, which is the 9th taking place in Romania and hosted by the National Bank. It all started in 2011 with “Renewable energy and transport infrastructure in the Black Sea Region”. One year later we talked about “Eastern Europe and the EMU: finding the optimal path for introducing the euro”. In 2013, there was the 3rd edition of the Danube Financing Dialogue. The following year the dialogue focused on “Agriculture and environmental protection in Central and Eastern Europe and their contribution to growth and employment”. In 2016, we discussed “How the EU can generate a virtuous circle in the Black Sea Region – the case of food and energy security” and in 2017 we debated on “the challenges for Eastern Europe in the present turmoil in the EU and EMU – persevering in the reforms and investing for the future”. The topic of the last year, “Convergence towards euro enlargement”, is approached again today, which is more than welcome, given the importance attached to this issue. The debate on convergence and euro adoption is broad-based and complex. The topic has been addressed in yesterday’s dinner speech by Academician Daniel Daianu.

Gross capital flows, however, are much larger: this may suggest that the economy’s degree of vulnerability is actually larger than currently accounted for. Should we therefore be concerned with large two way (gross) flows, as opposed to net flows, and the size of the much larger global balance sheet if counted in this way? Arguably, large gross capital flows and the flow of surplus capital from emerging markets to more developed markets may be a structural phenomenon, as mentioned earlier. The characteristics of developed financial markets, in terms of lesser financial frictions, better information and fewer borrowing constraints leading to better liquidity and lending, as well developed social welfare systems, are reflected in the persistent gap in savings compared to developing markets. In addition, financial integration has facilitated cross border arbitrage transactions, resulting in easier liquidity conditions globally. The implications and associated risks of this high level of global liquidity are different depending on whether the current state of affairs is a new equilibrium consistent with the conditions under globalization (e.g. case above), meaning that monetary policy should not try to counteract this phenomenon. However, if the current phenomenon is due to temporarily excessively accommodative monetary policy that would eventually translate into higher inflation, this would require eventual tightening and lead to the risk of capital reversals. But there are also compelling reasons to argue that risks have been better distributed, given financial innovation and various credit risk transfer mechanisms.
Hamad Al-Sayari: Review of the Saudi Arabian economy Speech by His Excellency Hamad Al-Sayari, Governor of the Saudi Arabian Monetary Agency, to the Custodian of the Two Holy Mosques, on the occasion of the presentation of SAMA's Forty-Second Annual Report, Riyadh, 14 November 2006. *  *  *  Custodian of the Two Holy Mosques, It is a great pleasure for me to present to You the Forty-Second Annual Report of the Saudi Arabian Monetary Agency which reviews the most salient domestic developments of fiscal year 1425/26 H corresponding to 2005G and latest developments during the current year 2006. Custodian of the Two Holy Mosques, Your government continued during 2005 and the preceding period of this year to make a number of important decisions and achievements in the area of updating regulations, restructuring the national economy, approving a number of great development projects, accession to the World Trade Organization which is a significant step towards further integration into the world economy, attracting foreign investments, opening and expanding markets and reinforcing the competitive capacity of the national economy. Therefore, an observer may say that the national economy is moving in confident and rapid steps on the right path towards more strength, diversification and employment of national man power. All these efforts would boost achieving sustainable growth. Custodian of the Two Holy Mosques, In pursuance of Your efforts aimed at regulating, streamlining and enhancing institutional work, You have recently approved the Homage System (Nidham Al-Bai'a).

These two examples are of course extremely simplistic, and are not realistic parameterisations of the Bank’s actual RSS. In broad terms, the elasticity of the Bank’s RSS is pinned down by three broad considerations. First, the Bank sees merit in allocating some funds regularly against wider collateral, to ensure counterparties remain familiar with the auction structure and continue to participate. Second, the Bank should not undermine the incentives to manage liquidity prudently. And third, the auctions should permit an increased allocation against wider collateral to the system in the face of adverse liquidity shocks and the associated heightened demand for liquidity. While the principles underlying the Bank’s RSS are clear, the precise configuration of the RSS is not revealed to the market, so reducing the scope for firms to game the Bank, and encouraging them to bid according to need. The Bank’s supply curve should be continuous but otherwise need not be linear. In particular the Bank can use the results from each operation to determine the degree of stress in the market and hence adjust the scale of the operations accordingly. Equilibrium The equilibrium point, which pins down the clearing spreads and the share of funds allocated to the two collateral sets, is determined by the intersection of the observed demand curve, and the Bank’s RSS. Chart 7 illustrates that using our hypothetical auction bids from Table 1 above, and three hypothetical linear RSS schedules. In case of intersections such as those given by curves A and B, a unique equilibrium is well defined.