samchain/econo-pairs-v1 huggingface dataset:
This can be ascribed, on the one hand, to weak growth and large productivity gains and, on the other, to a lack of confidence in the soundness of the recovery. Monetary situation starts to normalise Thus, 2004 saw the economic situation starting to return to normal. Our aim was therefore to modify our policies so as to gradually bring the monetary framework into line with the new environment. A normalisation of the monetary situation should go hand in hand with an economic normalisation in order to ensure that price stability is maintained in the medium term. We waited until June – when the signs of a recovery became manifest – for an initial quarter-point rise in the target range for the three-month Libor. This decision did not really come as a surprise. In fact, the markets were expecting corrective action to be taken during the year. We proceeded to adjust rates again in September, but decided to leave them unchanged in December 2004 and March 2005 when it became increasingly clear that the economy was slowing down. Our three-month rate is 0.75%. Meanwhile, long rates fell during 2004, but have risen slightly since. The current interest rate reflects the fact that we are still pursuing an expansionary monetary policy: in view of the prospects for growth and inflation, our rates are relatively low. However, this phase of normalisation of monetary policy is not yet over. It will be continued according to the requirements for maintaining price stability in the medium term.

Since the single European currency was introduced on 1 January 1999, the Swiss franc's nominal appreciation has been more than offset by the inflation differential between Switzerland and the euro area. The competitive position of our exporters has thus improved against their European counterparts. The dynamism of the Asian economies has boosted demand for commodities, notably oil. The soaring price of this "black gold" continues to pose a serious threat to the recovery of the industrialised economies. Guardedly optimistic outlook for 2005 As it is benefiting from price stability, low interest rates and a strong competitive position, the Swiss economy is well placed to profit from the world economic upturn. However, the outlook for the global economy in 2005 is not quite as good as it was in the past year: growth is put at around 4%, down from 5% in 2004. Growth will continue to be driven by Asia and America. Europe – and especially  2  BIS Review 30/2005  Germany, our biggest market – will continue to chug along with a growth rate of between 1.5% and 2%. In this slightly less dynamic environment, the Swiss economy is unlikely to exceed its 2004 growth figure. Business activity has fallen off slightly since the autumn but should slowly gain momentum again in the next few months. Overall, we are expecting GDP to grow by about 1.5%.
Perceived risks to financial stability: credit growth and real estate markets The acceleration of credit growth is a prominent but natural part of the picture of robust economic growth and general optimism in the region. Improved access to credit in the Baltic countries has led to higher investments (much needed in rapidly developing economies) and helped to smooth consumption over time. For example, in Estonia the overall increase in bank credit and leasing accelerated to around 60 percent in mid-2006. This has by far exceeded the growth rates seen in the Nordic countries. On the other hand, the accompanying rise in indebtedness and current account deficits has given cause for concern to both domestic and international evaluators. It is always worthwhile to put things in perspective. During the past five years, the growth in household indebtedness in terms of GDP has been fast in several "old" EU Member States, including Denmark in fact, even faster than that in the Baltic countries. At the same time it cannot be forgotten that the level of household savings (especially long-term savings) in Estonia and other Baltic countries is still low when compared to that in the Nordic countries. Therefore, households face a non-negligible risk to their balance sheets, as their financial assets are still rather low in international comparison. It is the lenders - banks and leasing companies that need to take these risks into account. Of all the factors of credit growth I would point out two. Firstly, there are longer maturities of real estate loans.

In the current cycle there are more households with an access to credit, also from the lower income deciles, indicating the spread of the effects of the potential slowdown to a wider part of the economy. The second risk factor I would like to point out is the price level of real estate. Real estate prices have recently surged globally, and also in the Baltic countries. The possible factors behind this increase include rapid and relatively widespread income growth, favorable borrowing conditions, and international demand. However, despite these surges, absolute levels of real estate prices remain still about two times lower in Tallinn than in Helsinki, in line with the difference of overall price levels. There are signs that prices are now stabilized in nominal terms and may have slightly decreased in real terms. Nevertheless, relative prices of real estate have increased dramatically. Whereas the ratio of price of a square meter to monthly wages is about one in Helsinki, it exceeds two in Tallinn. The expectations of real estate price convergence fuel credit demand in Baltic countries but imply ever-increasing risks to  BIS Review 81/2006  3  both borrowers and lenders. (It is fair to say, though, that the majority of real estate loans are used for buying homes, not for speculation.) The third factor I wanted to mention - currency mismatch - has caught some attention from international observers. The issue is more nuanced than the classical approach.
The other are possibly more recent. 1. Is the financing of the economy still guaranteed? The answer is yes. For private individuals, housing loans in France are cheaper, more abundant, and safer than in all other major European economies. In a context of rising interest rates (estimated at an average of 1.84% excluding fees and insurance in November, compared with 1.12% in January), total outstanding housing loans were still 5.9% higher in October 2022 than a year earlier, and over 97% of these loans carry a fixed rate: this is a decisive advantage. For businesses, outstanding bank loans are rising sharply (up 8.6% in October): there has been a shift in the balance of corporate financing towards bank credit as the cost is more contained (rise of 85 basis points) than that of bond financing (up 350 basis points). Overall the real economy's financing needs remain largely covered, thanks to the work of the banks. 2. Are French banks and insurers solid? The answer again is yes, on several levels. French banks and insurers are in a solid financial and prudential position: the CET1 capital ratio of the six main banking groups is close to its all-time high (14.5% at endSeptember) and insurers'1 solvency capital requirement coverage ratio increased in the first half of 2022 to 263%. Bank profitability should also gradually be boosted by the orderly rise in interest rates. In addition, as highlighted in an ACPR study, French insurers make little use of the types of derivative products that UK pension funds use.

In 2012 three pre-existing sets of international standards were replaced with the Principles for Financial Market Infrastructure (PFMIs). 13  Crucially, the PFMIs embed the principle that firms providing systemically important financial market infrastructure have a responsibility to be ‘systemic risk managers’ – that is not only managing the risks to the firm but the risks to the system more broadly. I want to look today at three challenges that are increasingly prominent in this world of international financial market infrastructure –  Operational risk, especially cyber Prudential risk The regulation and supervision of cross border infrastructure. There are other challenges, not least the challenges posed to existing business models by new and potentially disruptive technology. But I want to concentrate on the first three because these are front and centre for those charged with ensuring financial stability. Operational Risk  It may appear strange to focus first on operational risk. When we think about financial stability, we usually think first about risk taking, about leverage and credit cycles and about banks, booms and busts – risks that one might call prudential. But in essence, financial stability is about ensuring the financial system can operate to service the real economy and is resilient to all types of shock. 12  Using initial margin as a proxy for the amount of risk managed, activity at UK CCPs has more than doubled in the last three years, from £ in January 2014 to £ in December 2016.The use of supervised payments systems has also increased significantly.
Ours is not a precise science. In fact it's more of an art than a science. And, although we bring as much economic and statistical science to bear as we can, we know that our forecasts, and indeed our policy judgements, are subject to a range of error. They cannot be accurate to every last digit. We can't expect to hit the target all the time, but by consistently aiming to do so (and we do consistently aim to do so looking 2 years or so ahead) we can hope to get reasonably close to the target on average over time. I'll come back in a moment to the objective, and to our experience measured against it. But perhaps I might digress briefly to make a couple of points about the principle of delegation of operational responsibility for monetary policy to the Bank. Some people I know had misgivings about that when it was introduced in 1997 on the grounds that interest rates are intrinsically a matter for elected politicians. But that neglects the fact that within the present framework in this country the Government specifies the objective of policy. That is a political decision insofar as there may be a short-run trade-off between growth and inflation - and the Government delegates only the technical task of setting interest rates to achieve that objective to the Bank.

Once you look beneath the apparently benign surface of the economy as a whole in recent years, you find very substantial differences in particular between many internationally-exposed sectors of the economy including particularly many manufacturing businesses - which have recently been having a really tough time, and other businesses largely serving our domestic market which have been doing pretty well. Let me assure you that the MPC is only too well aware of the problem. We receive regular monthly written reports from the Bank's 12 regional agencies all around the country on the state of the economy as seen through the eyes of their 8000 or so business contacts. That includes reports from John Bartlett our Agent here in Birmingham and Chris Brown, our Agent for the East Midlands based  BIS Review 23/2002  3  in Nottingham, both of whom will be known to many of you. And about half the Agencies by rotation attend our monthly pre-MPC meeting in London to brief us face to face. Beyond that each individual MPC member makes regular visits to businesses located all over the country to see and hear for themselves. All of this plays a vital role in informing our interpretation of the bare economic and financial statistics. It's not that we do not know what's happening at the micro-economic level, the question is what can we - what should we - do about it in setting monetary policy?
(2016), “The ECB’s asset purchase programme: an early assessment” ECB Working Paper, no. 1956. 14 Bagehot, W. (1873), Lombard Street: A Description of the Money Market, London: H.S. King. 15 Some move in this direction is presented in e.g. Bilbiie, F., Fujiwara, I. and F. Ghironi (2014), “Optimal Monetary  Policy with Endogenous Entry and Product Variety”, Journal of Monetary Economics, 64: 1-20. 16 Abraham Flexner (1939), The Usefulness of Useless Knowledge, Princeton University Press. 7/7  BIS central bankers' speeches

Who would have thought that inflation would reach double digit levels? In such an environment, in times of great uncertainty, resilience becomes a key priority for businesses and governments alike. Resilience entails two elements: preventing the build-up of vulnerabilities, and preparing to absorb the shocks when they occur. If you have not done first, the second becomes much more difficult. On prevention, a lot has been done over the past few decades - we are constantly developing new indicators, tools and instruments to address potential vulnerabilities. But, as we very well know, no crisis is the same, so on top of prevention we also need to work on our absorption capacity when a crisis happens. The pandemic has proven that only a swift and massive policy action can mitigate the economic effects of a huge external shock. However, the extent of policy action is limited by the available fiscal space, so this crisis has again highlighted the importance of building fiscal buffers – prevention. On our first two panels today, we'll have a chance to talk about building resilience in areas most hit by the recent shocks – the energy sector and supply chains – while at the same time being mindful of the importance of fiscal prudence. More broadly, in addition to prevention and mitigation policies, for building resilience it is also essential to rebuild trust in governance structures, institutions and data. This is because effective crisis responses depend on public acceptance and adherence to necessary measures and policies.
This is a commendable achievement but we still have a lot to do. As Malaysia moves forward with the economic transformation programme, the demands for the financial sector as enabler, catalyst and driver of growth will increase. The financial sector as a whole is expected to grow in size, from 4.6 times GDP now to 5–6 times GDP by 2020. The significance of financial markets, relative to funds raised through financial intermediaries such as banks, will continue to rise. In meeting the needs of the new high value added economy, our financial sector needs to be developed further and innovative in its approach in order to facilitate higher levels of domestic and international trade and investments. One such innovative approach is the development of a comprehensive and vibrant Islamic financial industry. It is our aspiration to transform Malaysia as the Islamic Financial Hub. Crucial to the transformation is intensifying of our efforts to further develop the foreign currency markets in Malaysia. In particular, we should seek to capitalise on our competitive advantage in Islamic financial markets and move beyond our previous focus of advisory and promoting primary market issuances and move up to build an end-to-end value chain capability – where we should also focus on secondary market trading, settlement and custody services. But this aspiration of ours could only be achieved if there is a collaborative effort between the industry and the authorities.

And the G20 fulfilled the most optimistic anticipations as it reacted promptly and strongly to the crisis. Beyond this, the G20 has also agreed on an ambitious policy agenda, aiming for the long run. The G20 Roadmap does not only aim at one particular aspect of the global economy; it is very encompassing. One aspect of it is macrorebalancing, another is on financial regulation and global financial safety nets. The G20 agenda is focused on crisis prevention by coordination in order to avoid, or at least dampen overheating and boom/bust cycles. How are these issues related? First I will briefly tackle the important question of the link between the financial crisis and global imbalances. Second, I will go through the main implications of this link and outline the key features of the policy agenda of the G20. In this second part I will mostly focus on the so-called “G20 Framework for a Strong, Sustainable  BIS Review 93/2010  1  and Balanced Growth” and on financial safety nets. In the last section I will focus on financial regulation issues more specifically. Why and how do the financial crisis and global imbalances interact? An overwhelming body of research has established the clear relation between global imbalances and financial issues, some of which were behind the financial crisis. Indeed, global imbalances were not just the result of cyclical factors, such as business cycle fluctuations, changes in oil and other commodity prices, etc.
Prominent indices such as the Dow Jones Industrial Average, S&P 500, Nasdaq Composite, FTSE 100 and the Nikkei 225 have declined by an average of around 7% in mid-August, from highs in July. Another factor linked to the economic outlook is the role of monetary policy. Economic growth in the last decade has mainly been driven by the use of unconventional monetary policies. While these policies have supported economic recovery following the global financial crisis, by ensuring a low interest rate environment, they have led to other unintended consequences like fueling debt levels across the globe. Thanks to low interest rates, global debt has ballooned to over $ trillion, nearly 320% of global GDP.4 While household debt has seen a gradual increase (3% growth per annum), the real growth in debt lies with governments, financial institutions and corporates. In particular, government debt has doubled since 2008, from $ trillion to $ trillion, especially with governments in developed economies having borrowed heavily over the past few years. Among OECD countries, Japan, Greece, Italy, Portugal, Belgium, France, Spain and the UK now all have government debt that exceeds their GDPs.5 This extended period of historically low interest rates has also enabled corporates from around the world to take advantage of cheap debt. Global corporate debt has also nearly doubled over the past decade, from $ trillion to $ trillion, even Central Bank of Kuwait - Public ‫ عام‬- ‫بنك الكويت المركزي‬  -4-  surpassing the increase in government debt.

Sweden's weak point is the number of hours worked. In relation to the total demands on resources, there are already far too few that can or want to work full-time. The demographic situation will therefore place great demands on innovation. It is likely that employers will be forced to make better use of their labour, recruit from abroad and support people to be mobile so that they can find the right tasks in life. Employees will have to realise that if too many choose not to work, the welfare system will collapse. People that no longer feel satisfied with their work must think of alternative ways of supporting themselves. The welfare model must be designed to encourage people to work. Great demands will be placed on society to think in a longer-term strategic manner so that changes can be implemented in time. Competition in Europe for the young, and especially the well-educated, will be fierce. More people will have to want to stay in or move to our countries. Immigrants must be integrated quickly and successfully. Next year ten accession countries will join the EU and become a part of the free market. The enlargement of the EU and the establishment of a common labour market around the Baltic could perhaps increase the potential for an influx of foreign labour to the Nordic countries. But poorer countries further away are likely to offer greater potential - and pose a bigger challenge.
Others say that the consequences may be more difficult to deal with and more persistent precisely because the country has its own currency and is not under the wing of a large currency area. Yet others claim that if Iceland fixes itself against another currency and obeys the laws of others – interest rates based on what is happening in France, Italy and Germany and not in Iceland – that this will produce a more cautious attitude up here in the frozen north, the appetite for risk will diminish and economic developments will take a healthier turn. Thus there are countless questions, of which I have mentioned only a few. Of course I have taken care in these opening remarks to leave all these questions open for those who follow. It is a particular pleasure to have lured so many distinguished guests here to do theoretical battle about these questions. It is equally welcome to give our leading experts the opportunity and time to ponder these issues and present their own views. So everything promises a rewarding outcome from this conference. It has been organised with ample reason, in the right place and at the right time, and with exceptionally qualified speakers.

These changes are mutually reinforcing and will meaningfully improve our ability to achieve both of our dual mandate goals in an environment of a very low neutral rate. I’ll conclude with this: The new framework represents both an important evolution in our thinking about how to achieve our goals and another step toward greater transparency. It reaffirms key aspects of the original statement that have stood the test of time and refines others in line with experience and evolving practices. It also makes some more significant changes in light of developments and lessons learned in recent years. And most importantly, it positions us for success in achieving our maximum employment and price stability goals in the future. 1 See Board of Governors of the Federal Reserve System, Statement on Longer-Run Goals and Monetary Policy  Strategy, as amended effective August 27, 2020. 2 Longer-run forecasts of interest rates can be found in Blue Chip Financial Forecasts (Wolters Kluwer). For the  decline these forecasts over this period, see the June 2012 and June 2020 issues. 3 See John C. Williams, Three Questions on R-Star, FRBSF Economic Letter, 2017–05 (February 21, 2017), for a  discussion of the decline in the natural rate of interest. Estimates of the natural rate for the United States, Canada, the United Kingdom, and the euro area are available at Federal Reserve Bank of New York, Measuring the Natural Rate of Interest.