samchain/econo-pairs-v1 huggingface dataset:
If inflation expectations as indicated in various surveys are stable and close to the inflation target a few years ahead, this can be interpreted to mean that the public is confident that the Riksbank will achieve its target. The surveys that TNS Sifo Prospera has carried out of inflation expectations among money market agents, employer and employee organisations and purchasing managers in the retail sector and the manufacturing industry show that this is the case. Figure 14 shows average expectations regarding CPI inflation for one, two and five  BIS Review 32/2010  17  years ahead among all of the participants in the Prospera survey. Inflation expectations five years ahead are close to 2 per cent, which shows that the credibility of the inflation target is high. Inflation expectations for shorter horizons are based to a greater degree on current actual inflation. 11 The exceptional circumstances for monetary policy that have followed in the wake of the financial crisis, with substantial and rapid cuts in the repo rate, have pushed down CPI inflation to unusually low levels. This, together with the severe downturn and the uncertainty that prevails concerning the recovery of the economy, means that it is hardly surprising that short-term inflation expectations are now below the target. How well did the market’s expectations regarding the repo rate match the Riksbank’s repo-rate path? Since February 2007, the Riksbank has published its own forecast of the development of the repo rate in the period ahead.

perform an assessment based on the information available to the decision makers, or what can be called an assessment ex ante. The question that should then be answered is whether the analysis and the interest rate decision were reasonable given the information and the forecasts available at the time. Did the Riksbank, for example, arrive at a reasonable balance between stabilising inflation and stabilising resource utilisation? An assessment based on the information available to the decision maker also has the great advantage that it can be conducted in real time immediately after the publication of the monetary policy decision and the information and analysis on which the decision is based. One does not thus need to wait for a couple years to see what the outcomes for inflation and the real economy will be. The decisions of the Riksbank can therefore be assessed and debated on an ongoing basis. An important part of the assessment of a flexible inflation targeting policy is to assess how credible the inflation target is, measured in terms of the extent to which various economic agents’ inflation expectations correspond to the inflation target. If inflation expectations are stable close to the inflation target then the target is credible and it will therefore be easier for the Riksbank to stabilise both inflation and resource utilisation. As I have already said, it takes time for monetary policy to have an impact on inflation and the real economy. Monetary policy is therefore governed by forecasts.
So we also have to take a close interest in developments in overseas and international financial markets. The international bond market is of course a key example. We try to analyse the information in market prices and other data. But the real understanding of the latest developments comes from talking to market participants. Credit risk transfer markets This is particularly important when it comes to financial innovation. In recent years, instruments and markets for the transfer of credit risk have been a particular focus of change. New ways have been found to securitise cashflows which could not previously be traded, to unbundle the credit risk from loans and bonds, and to re-bundle credit exposures in different ways to create securities with different pay-offs. BIS Review 15/2001  1  The distinction between a loan and a bond is becoming increasingly blurred. Individual loans are sold into the secondary loan market, although some companies remain reluctant to see their debt traded in this way. And portfolios of loans and other cash flows, ranging from mortgage payments to recording royalties, are sold to special purpose vehicles for securitisation into tranches with different risk characteristics and maturities, from AAA to junk, and from commercial paper to long-term bonds. Portfolios of bonds are also repackaged, sliced and diced in a similar way to create collateralised bond obligations. The new area of growth at present, however, is not in these sales of assets to remove them from the balance sheet.

And, in turn, it could mean a reduction in the costs of risk transfer through securitisation or credit derivatives, with beneficial effects on banks' balance sheets and liquidity. However for this to happen, banks' internal ratings will need to carry credibility in the market and, for this, transparency is essential. The transparency proposals from the Basel Committee have come under a certain amount of fire for their volume and detail. But I would like the critics to dwell for a  BIS Review 15/2001  3  moment on the alternative: a world in which banks effectively set their own capital, with no assurance of consistency or comparability from one bank to another. This is an important debate and we are keen to listen to others' views before the proposals are finalised. Turning to the possible effect of Basel on capital flows more generally, including bank lending, undoubtedly the new risk sensitivity will tend towards changing conditions for certain borrowers and issuers. This is particularly marked in the sovereign context, where, based on current ratings, approximately twenty seven sovereign borrowers will incur a lower bank capital charge versus eleven incurring a higher one. Again I would stress that the cushion of capital which most banks maintain over and above their regulatory minimum will blur the impact of the Basel changes, since in these circumstances banks' lending and pricing decisions will not be constrained by the regulatory standard.
ACPR-AMF Forum Fintech – Paris, 19 October 2022 Speech by François Villeroy de Galhau, Governor of the Banque de France Chairman of the ACPR  Press contact: Mark Deen (mark.deen@banque-france.fr) and Deborah Guedj (deborah.guedj@banque-france.fr)  Page 1 of 5 Dear Minister, Ladies and Gentlemen, I am very happy to be with you again for this third edition of the Fintech Forum, organised jointly by the ACPR and AMF: I would like to extend my warm thanks to Minister Jean-Noel Barrot for being here today, and my friendly greetings to Benoit de Juvigny. Following on from last year’s success, this year’s event has again been organised as part of the "French Fintech Week", in association with France Fintech [a Fintech industry body] and Swave [the first French start-up accelerator dedicated to financial services]. This year I would like to welcome you all to the magnificent Salle Gaveau, a historical concert hall where I hope you will today hear a harmonious performance: the concordant voices of institutions and public authorities expressing their commitment to supporting our Fintech ecosystem – a fertile source of innovation that is essential for the French economy. We want to help the Fintechs become a lasting and integral part of our financial landscape (I). We will continue to work hard to keep pace with the digital transformations under way – especially in crypto-assets (II). *** I. Fintechs, major vectors of digital innovation, are becoming lastingly implanted in the financial landscape 1.

Over the past five years, the real exchange rate has moved within a relatively narrow band little more than five percentage points wide. Except for the post-September 11 period, when the Swiss franc appreciated markedly, the external value of the franc has largely reflected economic fundamentals. In fact, even the post-9/11 safe-haven effect was relatively mild compared to what we experienced in the past, during the seventies and the eighties, for instance. 4. A new international monetary order  I believe that one could make the case that the introduction of the euro has brought about a new international monetary order, that it has produced an element of stability that benefits many countries, not just Europe’s immediate neighbours, but nations around the globe. As we have seen, movements in the dollar/mark exchange rate were magnified as far as the Swiss franc is concerned in the past, but are much dampened today. When the euro depreciated against the dollar, the Swiss franc did so too, but by a much lesser degree. And later, when the euro appreciated against the dollar, the franc appreciated as well, but again to a lesser extent. In other words, our effective exchange rate has been less affected, the movement of the dollar being offset, at least to some extent, by a movement of the euro in the opposite direction.
Simon M Potter: Interest rate control during normalization Remarks by Mr Simon M Potter, Executive Vice President of the Markets Group of the Federal Reserve Bank of New York, at the SIFMA Conference on Securities Financing Transactions, New York City, 7 October 2014. *  *  *  I would like to thank Josh Frost, Lorie Logan, and Matthew Raskin for their excellent assistance in the preparation of these remarks and colleagues in the Federal Reserve System for numerous insightful comments and suggestions. Thank you, Rob. I appreciate the opportunity to participate in this important event. Securities financing markets are essential to the efficient functioning of the global financial system, and to the implementation of monetary policy in the United States and abroad. As you know, the Federal Open Market Committee (FOMC) recently published a statement on its policy normalization principles and plans. Today I would like to talk about these principles, and more specifically, about how the Committee plans to raise and control shortterm interest rates when it becomes appropriate to do so. Obviously, these plans are of interest to the Open Market Trading Desk (the Desk) as we must implement the directives issued by the FOMC after each meeting, and I am responsible for reporting to the FOMC on the transactions made to meet its operating target. I’ll also review the overnight reverse repurchase agreement (ON RRP) operations that the Federal Reserve has been testing for the past year, and explain recent changes the Committee made to these operations.

And the costs of taking this route would be unacceptable. References Bernanke, Ben S., Vincent R. Reinhart and Brian P. Sack, 2004, “Monetary policy alternatives at the zero bound: An empirical assessment(external),” Brookings Papers on Economic Activity, Vol. 35, No. 2, pp. 1–78, available by subscription. Eggertsson, Gauti B., and Michael Woodford, 2003, “The zero bound on interest rates and optimal monetary policy(external-pdf),” Brookings Papers on Economic Activity, Vol. 34, No. s1, pp. 139–211. Federal Open Market Committee, 2005, Meeting transcript(external-pdf), February 1–2. Krugman, Paul R., 1998, “It’s baaack: Japan’s slump and the return of the liquidity trap,” Brookings Papers on Economic Activity, Vol. 29, No. 2, pp. 137–206. Svensson, Lars E. O., 1997, “Optimal inflation targets, ‘conservative’ central banks and linear inflation targets,” American Economic Review, Vol. 87, No. 1, March, pp. 98–114. Taylor, John B., 1979, “Estimation and control of a macroeconomic model with rational expectations,” Econometrica, Vol. 47, No. 5, September, pp. 1267–1286. Woodford, Michael, 2003, Interest and Prices: Foundations of Monetary Policy, Princeton, NJ: Princeton University Press. Werning, Ivan, 2011, “Managing a liquidity trap: Monetary and fiscal policy (external),” National Bureau of Economic Research, working paper, No. 17344, August. 6  BIS central bankers’ speeches
Chart 3  Chart 4  Selected ten-year government bond yields(a)  Emerging market equity indices  Spain  Italy  US  Germany  UK  Indices: 22 May 2013 = 100  Per cent May 3rd  May 22nd  120  9  May 22nd  8  110  7 100  6 5  90  4  South Africa Korea China - Shanghai India Mexico Brazil Turkey Indonesia  3 2 1  80  70  60  0 Jan  Mar  May  Jul Sep 2012  Nov  Jan  Mar  May 13  Jul  Sep  Yields to maturity government bonds  Feb.  Mar. Apr. May. Jun. Jul. Aug.  Sep.  2013  Sources: Bloomberg and Bank calculations  Source: Bloomberg. (a)  Jan.  on  ten-year  benchmark  Although the sell-off has been wide ranging and left several EMEs with difficult policy challenges, I don’t sense any long-lived market dysfunction. Market infrastructures worked and prices adjusted to the revised policy outlook. Yes, volatility rose, but not to levels which  BIS central bankers’ speeches  3  are particularly unusual for such episodes (Chart 1). The most highly leveraged positions – such as in mortgage REITs1 – were reported to have liquidated quickly, and some ETFs2, primarily fixed-income, came under liquidity pressure. Those institutions with short trading horizons and leveraged positions may have found conditions very difficult at times to adjust portfolios.

Peter Praet: Interview in Börsen-Zeitung Interview with Mr Peter Praet, Member of the Executive Board of the European Central Bank, in Börsen-Zeitung, conducted by Mr Detlef Fechtner and Mr Mark Schrörs on 11 February 2019 and published on 18 February 2019. * * *  Mr Praet, how badly is the euro area economy doing? We have lately seen a marked increase in the risks for the euro area economy. That is why we revised our assessment at the last meeting of the ECB’s Governing Council in January. We see the constellation of risks surrounding the economic outlook, in other words the balance of risks, as tilted to the downside. That is a significant change in our communication and reflects concerns about the general economic situation. At the same time, however, we said that our baseline scenario has so far remained intact. In March we will have new macroeconomic projections from ECB staff and we will then re-examine our assessment. The December projections for 2019 to 2021 forecast growth of 1.7%, 1.7% and 1.5% and a gradual rise in inflation to 1.8% in 2021 – so approaching the ECB’s target rate of below, but close to, 2%. That surely can’t be upheld now, can it? I expect that the projections for the near term, in particular, will be revised downwards. The data since December have been much weaker than I had expected. But our discussion in the ECB’s Governing Council does not focus so much on the short-term perspective.
And for many of the same reasons, it too has resulted in a rising tide of rulebook complexity. The facts are striking. In the UK, the Banking Act (1979) covered 52 sections and 75 pages. By the mid-1980s, the Financial Services Act (1986) and an updated Banking Act (1987) had expanded primary legislation to 110 sections (106 pages) and 212 sections (299 pages) respectively. The Financial Services and Markets Act (2000) took this to 433 sections or 321 pages. And the new Financial Services Act (2012) takes this to 695 sections or 534 pages – a tenfold increase in primary legislation in a generation. In the US, the picture is no less dramatic. Contrast the legislative responses in the two largest financial crises of the past century – the Great Depression and the Great Recession. The Great Depression spawned the Glass-Steagall Act (1933) – perhaps the single most important piece of financial legislation of the 20th century. That ran to a mere 37 pages. More recently, the Great Recession has spawned the Dodd-Frank Act (2010). It runs to 848 pages or more than 20 Glass-Steagalls. Once completed, Dodd-Frank might run to 30,000 pages of rulemaking. The tax code has followed a similar evolutionary trajectory. In the UK in 1997, Tolley’s Tax Guide ran to around 5,000 pages. By 2009, it had reached over 11,500 pages; just two years later, 17,795 pages. That is a threefold rise in less than 15 years. In the US, the Federal tax system is celebrating its centenary.

Indeed, throughout this period of high inflation, one of the bright spots is that various measures of longer-run inflation expectations have remained remarkably well anchored and consistent with our 2 percent target.2  Imbalances Endure Our most important policy tool is the setting of the target range for the federal funds rate, which influences demand for goods and services by affecting borrowing costs. So far, tighter monetary policy from the Federal Reserve and central banks around the world is helping to bring a better balance between supply and demand. Inflation has declined in a number of sectors, particularly for many categories of commodities and goods. In addition, the supply-chain bottlenecks that had constrained the supply of goods have largely dissipated. For example, the New York Fed's Global Supply Chain Pressure Index has declined to a level that indicates supply pressures are now actually somewhat lower than normal.3 I hear the same from business leaders from around the Federal Reserve's Second District, who confirm that supply chains have improved considerably. At the same time, data on rents for new leases provide early signs of slowing inflation for shelter. This is important because shelter inflation had been a significant driver of higher inflation over the past year. However, despite the moderation of inflation, imbalances endure, with overall demand still exceeding supply in the economy. This is seen in the inflation rate for core services excluding housing, which has been running around 4-1/2 percent since last August.
The sector contributes about 12 percent of GDP, but more importantly, it represents about a fifth of our total employment, so we got a very hard hit in terms of income and employment to our labor force. The slow recovery of the tourism sector explains why our recovery will be slow going forward and probably slower than other countries in the region. While things were difficult back then, we saw a GDP contraction of over 6 percent in the first year that Covid-19 hit Thailand, and we grew by only 1.6 percent last year, but things could have been much worse in terms of the Covid-19 impact on the economy. Without the large policy response by the government, both on the fiscal and monetary side, things could have been much worse. We estimated that the economy could easily contract up to 9 percent instead of 6 percent without the fiscal stimulus in 2020. Last year, instead of growing at 1.6 percent, we would have seen a contraction instead of growth. We got hit very hard, but it is helpful to keep in perspective that things could have been much worse, but they came out better than they otherwise would have. We are where we are today was due to the substantial, and for the most part, largely effective policy response. I spoke a bit about the response on the fiscal side at the Ministry of Finance in stimulating the economy.

Ingimundur Friðriksson: Monetary policy and the current monetary situation Address by Mr Ingimundur Friðriksson, Governor of the Central Bank of Iceland, to a civic club meeting in Reykjavík, 26 February 2003. *  *  *  The framework for monetary policy in Iceland was altered decisively in March 2001. The government and the Central Bank issued a joint declaration adopting inflation targeting as the mainstay of monetary policy and abandoning the fixed exchange rate policy which had been followed for just over a decade. To begin with, a relatively narrow target band was set in the previous regime for the reference exchange rate of 2¼% in either direction around the central value for the króna. This was widened in two stages, to end up as a 9% deviation in either direction early in 2000. During this period, price stability was the principal objective of monetary policy and a stable exchange rate was an intermediate target. Since the adoption of inflation targeting, the Central Bank’s inflation forecast could be said to have actually served as an intermediate target of monetary policy, with the ultimate objective price stability. Inflation targeting has established itself in many countries in recent years and has formed the backbone of monetary policy, for instance, in the UK, Sweden, Norway and New Zealand, with good results in each case. In May of 2001 the Icelandic parliament Althingi unanimously adopted a new Central Bank Act, which entailed extensive changes from the previous legislation.
24 For reasons of self-image and social identity, these boys systematically underperformed relative to their ability, not wishing to be seen to be “acting white”. Some of the self-same social identity problems may exist in banking. An experimental study in 2014 looked at the incidence of cheating in different groups. 25 It found not only that bankers were more likely to cheat, but that this cheating was more prevalent when people were reminded that they were bankers. They then “acted banker”. In other words, social  21  O’Neill (2014). 22  Labaton Sucharow (2013). 23  For example, Akerlof and Kranton (2010). 24  Fryer (2006). 25  Cohn et al (2014). BIS central bankers’ speeches  5  identity mattered. If that social identity is defined by cheating or by failing to fulfil fiduciary functions, these behaviours will become self-reinforcing and self-fulfilling. If this evidence is right, it suggests that the culture problem in banking may be deeply ingrained, psychologically and sociologically. That still begs the question, however, of what happened to change the social identity of banking in the first place. The crisis alone is not a sufficient explanation. Complaint cases taken by the public to the Financial Ombudsman were rising prior to the crisis, despite bankers riding a reputational high over that period. The erosion of trust in banking appears to have been secular. In making sense of these trends, a useful distinction is between personalised trust and generalised trust.

These promises rely on trust. It also involves, in John Kay’s words, “other people’s money”. 11 It is a fiduciary function. It is these two features that make any loss of trust in banking particularly damaging and worrying. And as the New City Agenda’s research makes clear, there has been a significant loss of trust in banks, and hence an erosion in social capital, since the financial crisis. 12 Despite a modest recovery over the past few years, it remains at low levels both by historical comparison and relative to most other industries. 7  For example, Putnam (1995, 2002) and Field (2003). 8  The pre-crisis trends here are calculated using the average annual growth rate between 1997 and 2007. 9  IMF (2015). 10  Friedman and Schwarz (1963). 11  Kay (2015). 12  New City Agenda (2014). BIS central bankers’ speeches  3  The latest survey by Edelman puts trust in financial services at 51% at a global level. That is well above the low-water mark of 43% in 2012. 13 But it means banking is still not trusted by around half the population. It leaves financial services at the bottom of the industry league table of trust. Here in the UK, the fraction of the population trusting banks is lower still, at around 41%. 14 Other surveys of the public tell essentially a similar tale. An Ipsos-MORI survey in 2015 found that little more than a third of those polled believed bankers told the truth.