samchain/econo-pairs-v1 huggingface dataset:
France’s GDP showed growth in the first quarter and a decline in the second quarter of this year. For the euro area as a whole, preliminary figures indicate zero growth in the second quarter. Some consumer and business confidence indicators have recently shown signs of improvement, and the EU Commission’s estimates point to moderate growth in the next few quarters. There are, however, no clear signs of an imminent and rapid recovery. Among our trading partners as a whole, economic developments over the past year have been far weaker than Norges Bank and others, both analysts and international organisations, had expected. Growth projections for 2003 have been revised downwards substantially over the past year, reflecting the effect on the world economy of a number of negative shocks such as the war in Iraq and SARS. Global growth is still expected to pick up gradually towards a more normal level, but the upswing may come at a later stage than previously assumed. However, we cannot rule out the possibility that the global economy is facing a relatively long period of stagnation with low and possibly falling inflation. This risk is reflected in the low short-term interest rates in the US, Europe and Japan. Long-term interest rates have edged up again recently. This may be an indication that financial market participants are now somewhat more optimistic and expect that the economic policy stimulus will have the desired effect. In spite of weak economic developments, oil prices have remained high.

2  Based on assumptions concerning forward rates and a gradually declining krone exchange rate. 3  Based on assumptions concerning forward rates and a gradually declining krone exchange rate, and an assumption that monetary policy easing will not translate into stronger wage growth. 4  BIS Review 38/2003  Capacity utilisation in the Norwegian economy is now neither abnormally high nor abnormally low. However, available statistics indicate that economic growth came to a halt during the winter. A global upswing will contribute to stronger growth in Norway. Growth is sluggish already, however, with stagnation in many business sectors. Since inflation is also low, a low interest rate is appropriate now. But it is always a question of weighing one consideration against another. Since December last year, monetary policy has been eased to a greater extent and more rapidly than has been customary. Following this phase of substantial easing, uncertainty with regard to economic developments in the period ahead has been somewhat greater than normal. With the easing that has been implemented, we must be particularly alert to changes in private consumption, wage growth and the krone exchange rate. If households expect the interest rate to remain low, private consumption may increase more than has been assumed. House prices and household borrowing may again accelerate. However, increased slack in the labour market and declining migration to the largest towns will reduce these effects. The risk of stronger growth in household demand must be weighed against the sluggish developments in the business sector.
Today, a central bank in a small open market economy, which would wish to turn a blind eye on the developments in the external environment and focus solely on the developments in the national economy, is doomed to failure. Secondly, globalisation changes the wage and price setting mechanisms in the national economy, which have an impact on the domestic inflation. Globalisation (the growing openness of economies) — through the growing share of countries with low manufacturing costs in the global output ― increases the margin and wage pressures, in consequence lowering the inflation. At the same time, globalisation drives up commodity prices, and thus contributes to — at least temporarily — increased inflation. Thirdly, increased international migration of workforce changes the situation on local labour markets. Where the workforce outflows, the wage pressures increase; in the case of an inflow of workforce, the wage pressures go down. Fourthly, globalisation changes the functioning of financial markets and increases the uncertainty as to the impact of decisions made by the central bank on these markets and on macroeconomic variables. Fifthly, globalisation has an impact on the central bank’s perception of the economic environment and the monetary policy strategy it applies. A fast transfer of the economic know-how (flow of the economic knowledge and analytical methods) changes the methods of economic analysis by central bank economists, as well as the way decisions regarding the monetary policy are made. Sixthly, globalisation increases the risk of speculative bubbles on the assets market.

Numerous statements following the presentation have indicated that the proper supervision is much better a response to the asset bubbles and many people have stressed that this is why the financial markets supervision should be independent of politicians, as it may be necessary to take actions aimed to restrict the speed of the speculative bubbles build-up , when this does not suit certain politicians due to the elections cycle. The majority of lectures which are delivered over the series of seminars by the Centre for European Regional and Local Studies and the UNESCO Chair at Warsaw University apply to the issues vital for local communities. The title of today’s seminar might suggest that we have discussed problems vital for the global economy and not for a local community, a city, a region or a university/higher education institution. This is not the case, however, as in the years to come the globalisation of manufacturing, services, investments, finances, the labour market and knowledge will progress, irrespective of the scale of national protectionism. The globalisation results will be thus felt by all: countries, regions, local communities and individuals. If we want to succeed, both as a country and as each and every one of us, we must be well prepared for globalisation. Thank you very much for your attention. 29  D. Kohn “Remarks by Donald Kohn at Monetary Policy: A Journey from Theory to Practice, An ECB Colloquium held in honor of Otmar Issing”, 16 March 2006. BIS Review 32/2006  9
Demand growth can then be brought into line with the growth of production capacity and result in a more stable path. By acting in good time in a manner that is predictable, it is hopefully possible to avoid interest rate adjustments that are more drastic. Meanwhile, economic agents can continue to count on stable, low inflation. An example of the good results that can be achieved with a forward-looking monetary policy is the US economy. With a judicious and timely tightening of the monetary stance, the Federal Reserve has contributed to a long period of sustainable growth. Since the gradual increase from 3% between 1993 and 1994, the fed funds rate has fluctuated between around 4.5 and 6%. This has accompanied a notably good economic development, with the longest postwar period of unbroken growth. The latent inflationary pressure has been held in check without arresting growth. Similar reasoning lay behind last week’s interest rate increase. The positive trend has been aided by the consolidation of federal finances. On the other hand, if inflation has already risen to a high level that is expected to last, the central bank may have to resort instead to larger interest rate increases to signal its determination to fulfil the inflation target. That weakens economic activity and risks a renewed increase in unemployment. Thus far the argument – and the question of which alternative is most advantageous – seems fairly simple. But that is where the difficulties begin.

The models being tested at present are simply too rough and ready. They tend to sound the alarm about events that never occur and miss those that actually happen. Although the picture looks bright, we know there are countries in the global economy that are vulnerable, with a situation that may deteriorate. Share prices, moreover, have climbed very high, not least in the United States. There are also imbalances in the US economy that may affect the future course of events. There is also the possibility, however, of demand growth in Sweden becoming even stronger. We do not know how other components of economic policy will be constructed in detail. I am thinking in particular of the current discussion about the direction of tax policy. The Riksbank is in no way opposed to tax cuts. On the contrary, strategic tax reductions could make the Swedish economy function better and thereby lead to higher growth. But we have a duty to issue a warning about a tax policy that would give additional force to a growth of consumption that is already rapid and thereby lead to economic overheating in Sweden. At the same time, I believe that decision-makers are aware of these risks. Taken together, all these factors make it difficult to assess the future development of demand. So there is reason to monitor developments closely. Conclusion At present I do not for my part see any direct, immediate threat to price stability in the Swedish economy.
However, with the normalisation of the external economic environment and opening up of access to the global capital markets for Russian companies, the investment demand will gradually recover. Implementation of large infrastructure financing projects, including energy export project in the framework of co-operation with China, will also contribute to the investment growth. According to our estimates, the decline in fixed capital investment will cease in 2015, and in 2016–2017 the investment growth rate will gradually pick up. The restrictions on the imports of certain food products introduced in August 2014 will be conducive for import substitution. The import growth rates will remain low in 2015. Against the backdrop of low growth in the world economy and in the external demand combined with a decline in energy prices, no significant increase in export growth is expected. The impact of these factors on export and import dynamics will result in a decrease of the current account surplus to $ billion in 2017, whereas the private capital outflow will be gradually reducing. In the baseline scenario, we expect an acceleration of the GDP growth from 0.4% in 2014 (these are our assessments for this year) to 1.0% in 2015, 1.9% in 2016 and 2.3% in 2017. At the same time, the inflation will gradually decrease to 4.5–5.0% in 2015 (I stress again, that these assessments are based on rather optimistic assumptions of the baseline scenario) and to 3.7–4.2% in 2016–2017.

Increasing productivity is the key to securing our welfare and the stability of our social security systems. BIS Review 63/2004  1
Overall these measures amounted to 7% of GDP. The measures, and the population’s positive response to them, instilled confidence among Singaporeans and foreign investors. Fourthly, our banks were sound. Even during the boom years, our banks had been generally prudent and conservative in their lending policies. Also MAS had supervised the banks strictly, requiring high capital and liquidity standards, insisting on prompt and adequate provisions for non-performing loans, and frowning upon excessive expansion of bank loans. So when the crisis struck, the banks stayed on an even keel,6 even as MAS required them to make large general provisions in anticipation of future NPLs. Fifthly, we were lucky with our timing as we had deflated a property bubble early. Like several other Asian countries, Singapore had experienced a property boom. It started in 1993, and in just 3 years property prices had doubled. By early 1996, the property market was becoming dangerously overheated. The Government decided to prick the bubble. We restricted bank credit by capping housing loans at 80% of valuation, and imposed other anti-speculation measures. So by the time the Asian crisis struck a year later, property prices were already declining. The froth had been skimmed off. Had we not acted in 1996, the adjustment would have been more painful, and the banks would have had more serious problems with their loans. Managing financial sector reforms Although the crisis is past, we are not back to the status quo ante.

Even in Japan, where ownership of large corporations is not in the hands of families, long-term corporate relationships and cross-shareholdings have dictated business. This was how entrepreneurship evolved in East Asian societies, and among the overseas Chinese in South East Asia. Many of these family firms were hugely successful, driven by the business acumen and entrepreneurial drive of the founding patriarchs, and supported by a web of networks, or guanxi. But the world has changed. Family relationships may be an adequate basis for running a medium sized company, but not for an MNC employing tens of thousands of people. To be world-class, companies need to be led by the best man for the job, and this person is not likely to come from the same family, generation after generation. And business based on relationships rather than hard-headed commercial calculations is prone to abuse and under-performance, as was shown in the Asian crisis. It will not be easy for the families to relinquish control. The instinct to hand an heirloom down the generations is still strong. There are also real practical difficulties. If the families sell out, who will the buyers be? Who will take charge of the companies? Most Asian countries lack a group of institutional shareholders who can exert market discipline and defend minority shareholder interests, like the  3  Straits Times, 26 January 2000. BIS Review 76/2000  4  mutual and pension funds in the US.
This movement was particularly important in Italy, France and Germany, where sales represented almost three-quarters of the total amount. The change in ownership has paved the way for corporate strategies benefiting from an open access to financial markets. –  Another force at work in Europe is deregulation. The change is particularly noticeable in several key sectors such as telecommunications, transportation, the power supply industry and, of course, the financial sector. This movement has prompted a rapid response from regulatory bodies to monitor the introduction of market rules and ensure the appropriate functioning of fair competition throughout the entire European Union. Today, this institutional framework appears quite appropriate against a background of in-depth restructuring and numerous mergers and acquisitions all across Europe. –  Moreover, the liberalization required for the single market endeavor has been accompanied by an increasing need for transparency and accountability, which has brought substantial changes in corporate practices. More detailed rules of disclosure for financial information and competitive offers for public procurement programs have been implemented throughout a large part of Europe. This phenomenon has enhanced the overall efficiency of the European market economy. A second series of reforms has resulted in increased flexibility in the labor market During the past two years, employment has grown faster in Europe than in the United States. There has been strong job creation, particularly in the new economy, as can be seen in the remarkable  1  BIS Review 52/2000  increase in employment in the IT companies listed on the “New market”.

Indeed, it is crucial that payments of cash and delivery of securities be performed without undue obstacles throughout this very large financial area grouping so many market players keen on operating in deep and liquid capital markets. As regards this crucial issue of financial market integration, it is needless to insist on what has already been achieved during the last eighteen months. However, it is also important to keep in mind areas where some work remains to be done. •  The integration of interest rate markets within the euro zone is a first, key achievement that deserves to be underscored. The high level of integration that was accomplished can be observed not only at the short end of the market, in the inter-bank and money markets, but also at the long end. Market participants across the euro area now trade according to the same rules and practices, using the same indices (for example the Eonia and Euribor references on the swap market). When looking at the behavior of the market for government securities, it is striking to see how fast intermediaries, but also issuers, have adjusted to the new environment created by the introduction of a single currency. At the same time, the advent of the euro has been the catalyst for the development of a buoyant market for corporate securities. A market for high-yield bonds is already following.
All business decisions have risks and there must be mitigating strategies in place to manage adverse occurrences. Hearing your input and perspectives on these issues is an important part of the process for us, and I am fortunate to have the opportunity to meet with many community bankers in the Second District. Some of the most common themes I hear include: an appreciation for the recent regulatory reforms implemented such as the streamlining of the Call Report; the extension of the examination cycle to 18-month for firms under $ billion in total asset-size; and the current discussions around capital simplification. The comment period on capital simplification will close on April 9th, and I hope you all shared input to influence that important policy decision. 1/3  BIS central bankers' speeches  One area where we receive mixed feedback from bankers is the issue of off-site examinations. Some bankers love that idea, while others have stated they like the face-to-face interaction as it reduces the risk of miscommunication, misinterpretations or ambiguities. Still others prefer a hybrid approach with certain portions of examination work conducted on-site and others off-site. All felt critical meetings should be conducted in person. Today’s technology makes all of these options possible, and we will continue to exercise judgment and thoughtful communication with bankers to determine the best option. At the end of the day, our shared goal is a fair and accurate assessment for your institution, and we will continue to work together to accomplish this.

Turning to today’s conference theme of “On the Horizon for Community Banking,” I have a few observations that I’d like to share. These observations, in part, preview the day’s agenda and I look forward to the continued conversation on these important issues. First, our country and the banking industry have benefitted from steady economic growth, modest inflation, and low unemployment in recent years. These are all positive and welcome outcome, but not all regions have benefitted equally here in the Second District. Some portions of upstate New York have benefitted from an influx of technology companies and other industries, while other regions remain challenged due to a lack of population growth. Later today we will hear from two of our economists who will share national and regional economic trends. Also in the spirit of looking forward, I can share some views on what community bankers can expect from the supervisory process. Examiners are keenly focused on emerging trends around funding costs and liquidity risks. Bankers consistently share with us the challenge of raising core deposits to fund loan growth. Community banks compete not only with other community banks for deposits, but also with credit unions and larger institutions. And, these larger counterparts are actively courting customers through direct mailers and offering competitive rates. Data in the Second District show cost across most deposit categories have increased with a slight uptick in the higher cost funding sources such as borrowings. Data for the largest banks exhibit a comparable trend, but they control a larger market share.
As regards the European Union, the integration of national financial systems within a large, efficient market is the ultimate objective of the regulatory harmonisation. Since 1977, when the first banking coordination directive was laid down, two key principles have constantly been applied: •  On the one hand, the “European passport” gives the right of establishment and freedom to provide services within the area. •  On the other hand, supervision on a consolidated basis entrusts the consolidated supervision of banking groups to the home country, in cooperation with the host country. These are the two pillars of our European prudential framework. They are the basis for a clear definition of the respective roles of and close cooperation between national supervisors. Thanks to these principles, prudential supervision within the EU has for many years been conducted in a decentralised and cooperative manner which has proved its worth. In this respect, national supervisors are well prepared for the integration of the different national financial systems. BIS Review 85/2000  6  The same principles broadly apply for the supervision of insurance companies and insurance firms. As for cross-sector pan-European complex institutions, we believe that a similar combination of specialisation and intense cooperation is the best solution.

The result of our endeavour to act consistently and symmetrically has been fairly good; inflation has remained in line with the target level during the years of inflation-targeting policy. Nevertheless, I would like to point out that we do not follow our rules of action mechanically. Our focus is on the inflation rate one to two years ahead, and in this perspective we are clearly below the target level and today’s decision is therefore well-motivated. In addition, inflation will probably be well below target level for the greater part of the coming year, while it is difficult to envisage any strong reasons why it should accelerate rapidly beyond the forecast horizon. This is connected with the fact that there is presently a high level of unutilised resources in the economy and that resource utilisation is expected to increase slowly. Given this background, there should be plenty of time to take action and raise the rate in future; when and if there is reason to believe that inflationary pressure is growing. We also try to take into account in our actions risks to financial stability. This is primarily done on the basis of information on how lending and so on affects the banks, and through them, the payment system. However, there is also a more difficult problem concerned with how credit expansion and asset prices affect the conditions for the stability of the payment system, as well as for developments in the real economy in a slightly longer-term perspective.