samchain/econo-pairs-v1 huggingface dataset:
And the Bank of England is similarly mandated to pursue "price stability as defined by the (symmetrical) inflation target, and without prejudice to that objective to support the Government's economic policy, including its objectives for growth and employment". Now the exact words of these mandates differ - to varying degrees. What's more we all have our own procedures and processes - in terms of the composition of our decision-making bodies for example, or the form and frequency of our policy meetings, or of our arrangements for public accountability. And our approaches to fulfilling our mandates vary from one central bank to another - some of us, for example, have a more precise target, or tolerance range, for inflation, or some provide a more explicit role for monetary aggregates within the analytical framework and so on. And much is sometimes made of these various differences. One can in fact spend many happy hours debating the finer pros and cons of one formulation as against another, and that can be a productive thing to do in pointing up the issues, though I think in the end my own conclusion is that circumstances alter cases - there's no unique best buy. But I think that we need in any event to be careful that in pointing up the differences between us we don't exaggerate them. Because I have to say that in my experience - at a more fundamental level we are all trying to do the same thing.

What in practice central bankers everywhere have to do is to try to keep aggregate demand growing consistently over time broadly in line with the underlying, sustainable, rate of growth of supply. And consistently low inflation is essentially the measure of our success in achieving that. Yes, we are all  BIS Review 76/2001  1  aiming for effective price stability, certainly. But that is not simply a doctrinaire end in itself - as is sometimes suggested, though not often here in Germany. It is a reflection, if you like, of our broader aim of achieving macro-economic stability in the much wider sense of a sustainable balance between aggregate demand and underlying supply. Insofar as we succeed in that aim we can hope thereby to moderate rather than aggravate cyclical fluctuations in the economy, and to remove much of the nominal uncertainty and related short-termism from economic decision-making. To that extent we can help indirectly to improve the supply-side performance of our economies. This is essentially the thought that underlies the universal central banker's mantra that "Price stability is a necessary condition for sustainable growth", not to mention sustainable high levels of employment and rising living standards, which are, of course, the really good things of macro-economic life. Now it is relatively easy to explain in these terms what we are trying to do. Actually doing it is a good deal harder!
5 Figures 1 and 2 show a comparison of the accuracy of the forecasts in the period 1999-2008 for CPI inflation and GDP growth for a number of analysts. The red bars show the absolute mean error adjusted for differences in publication dates. The blue bars show the mean error with positive or negative sign. The shorter the blue bars, the smaller the systematic over- or underestimation has been – and the less bias the forecasts have had. If the bar is above the zero line the mean error has been positive and the forecasts have on average been too low, and vice versa. In the case of both inflation and GDP growth, the Riksbank's accuracy has been relatively good and its bias relatively small compared to other forecasters. Was monetary policy well-balanced ex ante? Given that it has been determined that the central bank's forecasts are normally satisfactory, the next step is to analyse, ex ante, the monetary policy deliberations the central bank has conducted on the basis of the forecasts. The first question to answer is whether the monetary policy conducted has been efficient. Given the information available at the time the decision was made, would it have been possible, by selecting a different interest rate path, to have stabilised inflation or the real economy better without stabilising the other less well? Would it even have been possible to achieve a better stabilisation of both?

The point in Figure 6 that corresponds to February 2008 is not far from origin, while the point that corresponds to February 2009 is a long way from origin and represents substantial sum of squares for the inflation-gap and output-gap forecasts. Assessing whether monetary policy has been efficient thus entails attempting to determine whether monetary policy has been on the modified Taylor curve or not. The analysis is therefore ex ante, which means that the starting point is the central bank's forecasts for inflation and resource utilisation rather than the actual outcomes. In practice it is of course difficult to perform a more precise analysis, it becomes rather a question of determining to what extent monetary policy has been clearly inefficient in the sense that it is easy to find another repo rate path that would stabilise inflation more without stabilising resource utilisation less, or that would even stabilise both more. A factor that can make the analysis even more complicated is if the central bank, apart from inflation and a measure of resource utilisation, also includes other targets or limitations in its monetary policy deliberations. On such conceivable factor is so-called interest-rate smoothing, in other words that the central bank also chooses to even out the changes in the policy rate and ensure that they are made in relatively small and regular steps, for example by 0.25 percentage points at a time. With such a restriction, monetary policy will be located at a point above and to the right of the modified Taylor curve.
A risk-sharing argument may call for the effects of monetary policy to be more evenly spread across households. On the other hand, monetary policy might have to adjust interest rates more dramatically in a world of widespread FRMs, which would affect some potential borrowers a great deal. Furthermore, FRMs require an extensive financial-sector risk transfer system 10, which may be costly, and may concentrate risks in systemically risky ways. Thus, there are clearly many tradeoffs that need to be carefully considered. Moreover, as academic research has emphasized, optimal mortgage choice depends on a borrower’s characteristics and financial circumstances. It therefore seems desirable that the mortgage finance system makes a range of different contracts available to borrowers, and be open to sensible innovations in contract design. 11 Although I have focused on ARMs, interest rate adjustability is only one of many important aspects of mortgage design that will be considered in the discussions today. Another important issue, for example, is how home price movements are shared between the borrower and lender. Home price risk is already partially borne by lenders and other mortgage investors, since a fall in home prices increases mortgage defaults and  6  See Agarwal, Driscoll and Laibson, 2013, “Optimal Mortgage Refinancing: A Closed-Form Solution”, Journal of Money, Credit and Banking, Vol. 45, No. 4, pp. 591–622.

On this front, we have seen increased diversity, both in terms of product offerings as well as in the issuers. In the area of product offerings, for example, we have seen an increase in the offering of commodity-related financial products. The Singapore Commodity Exchange launched a Robusta coffee futures contract in April last year. The Singapore Mercantile Exchange launched in August last year also provides a platform for trading a diversified basket of commodities including futures and options contracts on precious metals, agriculture commodities and energy. We have also replicated the success of the real estate investment trusts model for the infrastructure sector, further adding to the diversity of our capital markets. 14. On top of the increased diversity in product offerings, we are also encouraged by the increased diversity of issuers coming to tap into the depth and liquidity of our capital markets. Last year, we saw the first Russian debt issue in the Singapore market when VTB Bank launched its Sing Dollar Eurobond here. This paves the way for other highly rated Russian issuers to access our markets. In the area of Islamic finance, a number of international players have also tapped our markets for their shariah-compliant instruments. They include Saudi Arabia’s Al Rajhi Group1 and Malaysia’s Khazanah Nasional2. In November last year, Sabana also launched the first shariah-compliant Real Estate Investment Trust in Singapore, which is also the world’s largest shariah-compliant REIT. 15. Singapore plays a key role as a gateway to Asia, facilitating capital and investment flows.
While the main ingredients for successful central banking – clear mandate and independence – have proven highly effective for central banks to become guardians of price stability, they were not sufficient to ensure the more general stability of our economic systems. I would therefore like to turn to the ECB’s policy reaction, its challenges and limits to stabilise the euro area. The ECB’s policy during the crisis The financial crisis erupted in summer 2007, was magnified by the collapse of Lehman Brothers in September 2008 and eventually precipitated the global economy into recession. It was characterized by a drying up of liquidity in the interbank market, plunging asset and security prices as well as a sharp increase in risk premia for banks’ unsecured lending. Extreme risk aversion and contagion across numerous markets were the consequences, revealing a substantial fragility of the financial system and also shattering confidence in the self-correcting mechanisms of financial markets. At the beginning of 2010, the interaction of adverse conditions in financial institutions and their sovereigns brought the crisis in the euro area to new levels. The financial crisis first weakened banks’ balance sheets, reduced their lending capability and led to an economic slump. In turn, the fiscal support to the economy substantially worsened public finances. 7 The mutual weakening of private and public finances ultimately undermined the possibilities for a fast healing of the financial system.

DLT may provide a more efficient alternative to credit bureaus that compile consumer credit information from banks. The insurance industry in Singapore is looking at how DLT can help prevent duplicate insurance claims. 2/5  BIS central bankers' speeches  Probably, one of the potentially more powerful applications in financial services is in customer verification, the so-called “know-your-customer” or KYC process. Banks spend an inordinate amount of time and money on KYC, and yet struggle to effectively detect and deter money laundering, tax evasion, and other forms of illicit finance. DLT brings about opportunities for a shared industry-wide KYC utility that can verify customers and transactions in a more efficient and robust manner. This is not just conjecture. It is beginning to happen. In Singapore, OCBC Bank, HSBC and MUFG announced last week that they have completed a KYC blockchain project to reduce the duplicity of KYC processes, providing convenience for customers and efficiency across the banks. The “killer app” for DLT is really in cross-border transactions. When multiple entities across different jurisdictions are involved, there is no natural trusted central party. DLT allows the possibility of various parties working directly with one another to make crossborder transactions cheaper, faster, and safer. Cross-border trade is a good example. In Singapore, we are exploring two specific applications – trade finance and trade documentation. In trade finance, DBS Bank and Standard Chartered Bank are exploring the use of DLT to prevent the problem of duplicate invoicing while preserving client confidentiality.
2  BIS central bankers’ speeches  Regarding global activity, a stronger growth outlook has consolidated in developed economies together with a slowdown in the emerging world. Still, some downward adjustments are being made to the projections for this year, mostly driven by actual first-quarter data, leading to a marginal adjustment in the overall figure. Thus, it is expected that in the period 2014–2015 our trading partners will grow 3.7 percent on average, a tenth of a point less than was expected in March. In Latin America a less favorable picture emerges. Downward revisions in Argentina, Brazil and Mexico stand out in these settings. The price of copper has fluctuated significantly in recent months. After coming close to $ per pound, it returned to the order of $ The baseline scenario assumes copper prices of 3.1 and 2.9 dollars per pound in 2014 and 2015, respectively. The terms of trade would fall this year slightly less than projected the March IPoM, but somewhat deeper in 2015 (table 1). Inflation has remained well contained in developed countries, while in emerging markets, particularly in Latin America, the short-term outlook has been revised upwards, reflecting the depreciation of Latin American currencies in the past year. This, plus the changes in parities mean that foreign dollar inflation this year and next will be somewhat higher than forecast in the last Report. The Board estimates that in the baseline projection scenario, inflation in Chile will remain above 4 percent still for some months, ending 2014 around that figure.

In today’s speech, I want to highlight some of the key features of this highly integrated economic system and discuss some of the challenges it may pose in the future. In particular, I will discuss how the changing shape of the world economy affects the task of national monetary authorities, such as the MPC. In other words, how can economic policy-makers maintain stability when we are constantly in danger of being buffeted by powerful global economic forces? The rise of Asia and the changing shape of the world economy A key feature of the new global economy we now inhabit is the increasing economic strength of the Asia-Pacific region. Chart 2 shows that the top ten economies in this region – led by China, Japan and India – have already overtaken both the European Union and the United States in their share of world economic activity. This compares with the situation thirty years ago when these economies were collectively just half the size of the European economy, and about two-thirds the size of the United States. 2  BIS central bankers’ speeches  Chart 2 – The rise of Asia Percentage share of world GDP, at current market prices and exchange rates US  EU-27  40%  Asia-pacific G10 *  35% 30% 25% 20% 15% 10% 5% 0% 1980  1990  2000  2010  *: Includes Australia, China, India, Indonesia, Japan, Malaysia, Singapore, South Korea, Taiwan Province of China and Thailand.
Nina Stoyanova : Banks and business Speech by Ms Nina Stoyanova, Deputy Governor and Head of the Banking Department of the Bulgarian National Bank, during the video conference "Banks and Business", organized by the Capital newspaper, 2 December 2020. * * * I would like to welcome you to the video conference on Banking and Business, organized by the Capital newspaper. The banking sector is sending off a challenging year. In 2020, we witnessed the unprecedented pandemic caused by COVID-19, the imposition of measures to prevent its spread, which led to an economic downturn, as well as to many difficulties facing business and the people we have to deal with on a daily basis. However, there were also positive events during the year, such as the inclusion of the Bulgarian lev in Monetary Mechanism II and the establishment of close cooperation between the Bulgarian National Bank (BNB) and the European Central Bank (ECB) in the field of banking supervision in July. 2020 Banks in Bulgaria were able to quickly adapt to the new reality resulting from the pandemic and ensure continuity in the provision of financial services to businesses and citizens. This became possible due to the high degree of electronicization and digitalization of the banking sector in the country.

These pairs of possible clearing rates can be derived from the bids, and the resulting “frontier” can be converted into a “demand schedule” mapping the difference between the two clearing rates (known as the stop-out spread) against the proportion of the auction that would be allocated to wider collateral (and hence by implication, narrow collateral) in each case. This concept is best understood using a simple example. Consider Table 1 below, which shows hypothetical bids from six counterparties. Three of the bids are against the narrow collateral set (N) and the remaining three are against the wider set (W). At the end of the auction, the bids within each set are ranked from those with the highest spread to those with the lowest spread, as shown. For simplicity of exposition, assume that there are no paired bids, and that the Bank has committed to supply £ in this operation. The most systematic way to construct the demand curve is to start at the top left corner solution where all the funds are allocated against narrow collateral (bidders 4, 5 and 6 all have their bids filled). The clearing spread would be the lowest accepted bid on the narrow collateral: 10bps and that would dictate the uniform price.16 Now assume that 99% is allocated to narrow (conveniently 1% is equal to £ in this example), and 1% to wider collateral.
I think there is a broad agreement on the fact that interest rate decisions are state-dependent rather than time-dependent and as a consequence, both the frequency and the amplitude of the policy changes are mainly driven by the underlying state of the economy. As far as the Eurosystem is concern, the more gradualist approach is nothing but the reflection that the economy of the euro area has been less affected by cyclical fluctuations than the US economy. Moreover, recent research carried out by the Eurosystem on inflation persistence tends to show that the degree of inflation persistence in the euro area is quite moderate while the degree of price stickiness is considerable and higher than in the United States. This finding may provide another justification for a gradualist monetary response to cost-push shocks as: first, the impact of an inflation shock will be small as agents anticipate a low persistence of this shock and therefore will reduce their expectations of future inflation; in turn, the negative response of the output gap will be limited implying a less persistent response of the real rate. 5. As a result, the Eurosystem monetary policy has won European citizens’ confidence in and acceptance of the new currency Finally, the euro has been readily accepted by economic agents and is now part of European consumers’ daily lives. Surveys confirm that the general public has confidence in the euro, as a solid currency, and in the Eurosystem as their Central Bank.

This partly reflects the global trend towards lower neutral interest rates observed in recent years and is consistent with the reduction in the trend growth estimate for Chile. The technical minimum of the MPR is kept at 0.5 percent. As in March 2020, this considered that the money market is managed by various administrators competing with each other and with banks. Among others, they offer quick exit investment instruments that allow them to meet the immediate cash needs of households and businesses, being able to withdraw their funds the following day. When selling these instruments, there may be price differences that need to be covered. Therefore, as the MPR approaches zero, the probability that firms and households will incur losses increases. To keep this mechanism in operation, the Board estimates that the technical minimum of the MPR is 0.5 percent. Still, it is important to note that this technical minimum is not a constraint for an expansionary monetary policy, thanks to the fact that we are far from a deflationary scenario. Moreover, the interbank rate can move within a corridor of ±25 basis points around the MPR and, in fact, in periods of high monetary expansion, it has been below the technical minimum. This has been the case in the last year and was also the case in 2009, when the MPR also hit 0.5 percent and the Bank used its Term Liquidity Facility (FLAP). 1  It should be noted that the present exercise has used TFP information from the last four years.
However, the origin of the crisis is not this loss of confidence, but rather can be traced back to years of financial excesses that will take time to resolve. 6 The big and, in the light of what we know today, unreasonable private overborrowing in many developed countries will have to be corrected, leading to significant de-leveraging mostly of households. They will raise their saving rates which will hold back growth in consumption and demand. The countries that grew fast based on credit booms will have to adjust. We cannot expect the world economy to go back to pre-crisis growth rates. These are normal stages of the business cycle, but the magnitude of the imbalances that formed in those countries now experiencing financial crises indicate that their recovery will be slower. This is why when the downturn of the economic cycle combines with a financial crisis, its costs are magnified. This can be understood and even quantified by using consumption theories, but that we will save for a future opportunity. Thank you very much. References Blanchard, O. (2009), “(Nearly) Nothing to Fear but Fear Itself,” The Economist, January 29th. Bloom, N. (2009), “The Impact of Uncertainty Shocks,” Econometrica, Vol. 77, No. 3, pp. 623-685. Cooper, R. (1999), Coordination Games: Complementarities and Macroeconomics, Cambridge University Press. Cooper, R. and A. John (1988), “Coordinating Coordination Failures in Keynesian Models,” Quarterly Journal of Economics, Vol. 103, No. 3, pp. 441-463. De Gregorio, J. (2007), Macroeconomía. Teoría y Políticas, Prentice Hall-Pearson Educación.

350  300  300  250  250  200  200  150  150  100  100  50  Jan.05  Jul.05  Jan.06  Latin America Eurozone  Jul.06  Jan.07  Jul.07  Jan.08  Emerging Asia United States  Jul.08  50  Jan.09  Emerging Europe Japan  (*) MSCI for regions, Dow Jones for the U.S. and Nikkei for Japan. Source: Bloomberg. Figure 12 Commodities prices (index 01/03/2005=100; gold in US dollars per ounce) 400 Subprime crisis erupts  300  Bear Stearns  1,200  Lehman, AIG, etc. 900  200  600  100  300  0 Jan.05  Jan.06  Jan.07  GSCI grains and cereals GSCI energy GSCI metals  Jan.08  Gold  Jan.09  0  Source: Bloomberg. BIS Review 76/2009  13  Figure 13 Share of durable goods in total exports and contribution of exports to GDP quarterly growth in the fourth quarter of 2008  Durable exports (percentage of total exports)  HK  60  SIN  50  COR  HUN FIN  RCH  40  TAI  ALE  30  HOL BEL  R2 = 0,52 -35  -30  20  CAN  BRL AUS CHL  ARG  -25  -20  -15  -10  -5  NZL  10 NOR  0  COL  5  10  Exports (contribution to GDP, annualized quarterly change, percent) Source: Central Bank of Chile.