samchain/econo-pairs-v1 huggingface dataset:
The first two central banks, the Sveriges Riksbank and the Bank of England, were founded in the second half of the seventeenth century. The Banco Nacional de San Carlos, the first forerunner of the Banco de España, was founded during the reign of Charles III, the Enlightened, in 1782, and the Banque de France opened its doors in the year 1800, shortly after the coup of 18 Brumaire, which brought Napoleon to power. Central banks were initially set up to satisfy European states’ demand for funds, to pay for their increasingly costly armies. The banknote issuance monopoly, which most central banks enjoyed from their foundation, was the main feature that distinguished them from commercial banks. Until the First World War, the operations of central banks were linked to the gold standard. The interwar period was marked by a number of economic disasters, such as the hyperinflation in Germany and the Great Depression in the United States, partly associated with the attempt to adapt the role of central banks to the new political realities. The post-war world was marked by the Bretton Woods agreements, which are named after the location (well chosen, it is really a beautiful place that I would recommend you to visit when you get the chance), in the US state of New Hampshire, where there was then, and there still remains today the hotel at which an international conference was held in July 1944.

Anita Angelovska Bezhoska: We remain consistent in maintaining price and denar stability Address by Ms Anita Angelovska Bezhoska, Governor of the National Bank of the Republic of North Macedonia, marking 28 years of monetary independence of the country, Skopje, 26 April 2020. * * *  This day has been deeply imprinted in our history. On 26 April 1992, the independence of our country was completed with the last piece of the mosaic – the monetary sovereignty. The grounds of the monetary independence were laid 28 years ago, by introducing the denar as our currency that replaced the Yugoslav dinar. At the same time, the National Bank began operating as an independent central bank, standing firm in front of the series of challenges in those turbulent times of separation from the Yugoslav state. I address you in times when the global population is facing pandemic of unprecedented proportions. Now, allow me to briefly retreat from the everyday hardship and recall this crucial day of the monetary history, when our modern central bank began constituting with great dedication, sacrifice and vision. A central bank with mission that has been clear since early days – to create an independent and responsible institution that will cope with the current challenge of macroeconomic stabilization and build a capacity to approach central banks in the developed market economies. Looking back, I believe that the challenges of the National Bank’s leading team in the first years of independence had been immense.
Across various sectors, disruptive technologies are rapidly expanding the horizon of economic opportunities while challenging existing business models. In the case of banking for instance, we have already seen greater competition from new entrants amid the emergence of fintech. Rapid urbanisation, which is more pronounced in emerging markets, and demographic changes such as an ageing population are other key trends which have major implications on economic and socio-political conditions. At the same time, there is a growing appreciation for the far-reaching impact of climate change, giving rise to calls for more sustainable growth models and innovation. All these developments that are taking place in the banking industry today have created an environment much different from the one prior to the crisis. And together with the implementation of the post-crisis global regulatory reforms, which remains a key priority, their implications require careful and deep thinking as banks plan for the future. Domestic policy continuity and priorities Our banking industry is facing the current rapidly changing and challenging economic environment from a position of strength, following the successful reform measures that were implemented. Given the high degree of openness of the Malaysian economy and the increased integration with the international financial system, external developments have continuously affected our domestic economy. But the economy has been able to weather these challenges and have remained on a steady growth path of 4 to 6% over the past five years. In recent quarters, economic growth, however, has moderated.

This occurred against the background of a significant interest rate differential, given the comparatively high inflation and increasingly abundant capital flows, as the removal of capital controls was proceeding rapidly due to the requirements of the forthcoming EU membership. Such an environment naturally produced nominal appreciation of the domestic currency, providing further incentive for foreign currency lending, booming domestic demand and an unsustainable decrease in inflation, as revealed by an ever widening current account imbalance (to the tune of two-digit numbers as a percentage of GDP). To further complicate matters, the newly found prosperity lured fiscal policy into relaxing pro-cyclically. Trying to cool down the economy through the standard recipe of policy rate hikes would have been pointless, if not outright detrimental, by prompting even more capital inflows and nominal appreciation, thus feeding the vicious circle described before. 2. How far has the NBR departed from the standard paradigm? Quite far, I would say, if we use as a benchmark the clearly defined IT framework. Constrained in the resort to the policy rate, the NBR had to depart, at times, from monetary policy orthodoxy. Such departures from conventional practices involved full use of direct FX interventions, allowing market interest rates to fall significantly below the policy rate through liquidity management or deploying administrative measures to control credit growth.
6  BIS Review 25/2002  The EU and EMU  EU membership is one of the structural factors that are assumed to have increased competition in recent years. The idea in creating the EU's common market was to abolish the legal and administrative impediments to trade and thereby increase competition between and within the member states of the EU. This, together with better usage of economies of scale, would cause price levels to converge. It is now 9 years since the common market came into force and we can conclude that the price differences between the member states still remain. There are also considerable differences between the USA and the EU with regard to price spread. Almost one-third of all brands has a price spread of between 60 and 100 per cent within the EU. The corresponding figure in the USA is 9 per cent. One reason for this is that even if the legal trade impediments have been largely removed, there still remain a significant number of non-tariff trade barriers in the form of, for instance, various standards that segment the national markets. Transport costs and differences in consumer preferences are also factors that counteract market integration. A clear sign of market segmentation is that the price differences between the countries are significantly larger than within the countries. The EU/EEA countries trade almost 90 per cent with one another. Internal trade is therefore approximately as important or more extensive here than it is in the USA.

Percentage points 30  28  30 21 21  20 10  18  20 5  10 2  2  0  0  0  0 -3  -10  -3  -10 -14  -20  -17  -20  -20 -26  -30 S  DK FIN UK IRL D  F  B  Note. SV=Sweden, DK=Denmark, FIN=Finland, UK=United Kingdom, IRL=Ireland, D=Germany, F=France, B=Belgium, A=Austria, L=Luxembourg, NL=Netherlands, I=Italy, E=Spain, EL=Greece, P=Portugal. A  L  NL  I  E  EL  -30  P  Source: Eurostat. The fact that there exist price differences between countries is partly due to structural factors. One important factor is the income level (richer countries usually have higher prices). Taxes, wages, population density and changes in the exchange rate are also of considerable significance. Sweden has, for instance, higher VAT and unit labour costs, i.e. payroll expense including social security contributions adjusted for productivity, than the EU average. Sweden’s geographical situation and the fact that we are a sparsely-populated country mean that we are also affected by higher transport costs, lower economies of scale and thereby have higher prices. It is estimated that approximately one half of the Swedish price level difference from the EU average 5 can be explained by structural factors. The other half is attributed to a lack of competition. Calculated in krona, this means that a family with two children pays approximately SEK 30,000 more a year for their purchases than they would otherwise.
(2000): “Estimating and interpreting interest rate expectations”, Economic Bulletin 3/2000, Norges Bank, and Myklebust, G. (2005): “Documentation of the method used by Norges Bank for estimating implied forward rates”, Staff Memo 2005/11, Norges Bank. Both articles are available on www.norges-bank.no. 2  BIS Review 6/2006  As from Inflation Report 3/02, the Bank has published a recommended interval for the sight deposit rate over the following four months. To begin with, the interval was published at the end of the period to which it applied. Since Inflation Report 2/04, it has been published ahead of the period. The interval reflects the Bank’s sight deposit rate projection for the following four months, conditional on economic developments that are approximately as projected. The interval is an important part of the Bank’s communication strategy. Since we now also publish an interest rate projection for the entire projection period and not only for the next four months, economic agents gain broader insight into the analytical base, the assessments made and the Bank’s response pattern. Possible advantages of an explicit interest rate projection In forecasting inflation and output, there may be a number of advantages to basing forecasts on an interest rate projection that in the Bank’s opinion provides a reasonable balance between the different monetary policy objectives. 2 A communication such as this makes it clear which interest rate path, in the Bank’s opinion, provides a balance between monetary policy objectives.

Given the information at the Bank’s disposal and the assessments made by the Bank at the time the projections are made, the interest rate forecast in the Inflation Report will reflect a monetary policy that provides a reasonable balance between the objectives of stabilising inflation at target and stabilising output and employment. This forecast might in many cases be close to market expectations, but this will not necessarily be the case. When the interest rate forecast reflects a monetary policy that provides a reasonable balance, it contributes to monetary policy predictability. With a predictable monetary policy, market participants can react to new information in a way that contributes to stabilising developments in output and inflation. This makes monetary policy more effective, especially if market participants share the central bank’s analyses and assessments. To be successful, monetary policy must be capable of influencing expectations. This is essential to effective monetary policy. The essence of this argument is that it is primarily through the expectations channel that the central bank can influence economic developments. The expectations channel is the most important channel for monetary policy transmission. 3 The central bank determines the shortest money market rates via the key rate. The shortest rates, however, are of limited importance to economic agents’ consumption and investment decisions. These decisions depend more on agents’ expectations with regard to future developments in the key rate. The key rate is primarily effective because it influences market expectations concerning future interest rates.
But it presumably helped that the Riksbank has endeavoured to open up discussions, present the grounds for its policy and do so in accordance with clear principles. In my opinion, the most important link in our communication is monetary policy’s analytical framework. This includes the distinct 2 per cent target and the specification of the deviations from this that may be acceptable in connection with transitory effects. It also includes the rule of action and the fact that to a large extent we have adhered to it. Finally, it has to do with the forecasts and assessments on which the policy is based being published and used to argue for the policy. The changeover to the new Executive Board with six members gave transparency a new dimension. Previously, external communication had been in the hands of the governor and the deputy governor responsible for preparing monetary policy. It involved mutual consultations and aimed to voice a single opinion. With the new Board, each of the six members is individually accountable for the monetary policy decisions. So ought not each one be allowed to make their voice heard? How could their individual contributions be properly assessed without knowing their positions on monetary policy issues? But how were all the speeches and other statements to be coordinated efficiently in practice to ensure that they conveyed a single, clear picture? With the procedure we have chosen, you know that each of us normally speaks independently of the others.

The minutes of the monetary policy meetings are published after a time and record our discussions in outline, besides containing information about how each of us voted. We have deliberately refrained from labelling what we say at the meetings with our names. We believe that would not work very well; the discussion would presumably be more premeditated than one would wish. But even with the system we have chosen, there is presumably a risk of jeopardising the spontaneous exchange and testing of ideas. Our joint communication about monetary policy issues takes the form of the Inflation Report and the press notices and communiqués that are issued after the meetings. We also have an arrangement whereby one of us is entitled to speak for a majority of the Executive Board. An announcement to that effect is made and to date it has happened only when the Governor meets the Riksdag’s Standing Committee on Finance. At the press conferences on monetary policy, moreover, the Governor and myself, as the member responsible for the preparation of material, speak on behalf of the Board. Our procedure clearly entails risks. The media may focus most of the time on differences between our views, which could harm the Riksbank’s image and possibly also create internal problems. While that has generally not been the case, our system is vulnerable. It would not be difficult for a Board member to act in such a way that ‘conflicts at the Riksbank’ hit the headlines.
We conduct two monthly surveys – the Empire State Manufacturing Survey and the Business Leaders Survey of service firms – which help us monitor regional business conditions in close to real-time. We’ve also developed a “Regional Mortgage Conditions” analysis at the county and zip code level. In addition, we conduct a biannual poll of small businesses to understand their credit needs and availability. It is noteworthy that our most recent poll found that cash flow issues replaced credit availability as the number one concern of small companies. We also have worked to support better financial decision-making by young consumers. Every year the Bank conducts two competitions in which college students are challenged to produce a 30-second video promoting wise credit use. The two contests, one held in Puerto Rico and the other in the tri-state region, provide students the opportunity to learn about the importance of personal finance while showcasing their filmmaking creativity. The winning video is then shown at numerous local movie theaters, helping promote the value of the smart use of credit. This year the judges, including Maria Bartiromo from Fox Business, Tamir Muhammad from the Tribeca Film Institute and Jim Rosenberg from UNICEF, selected a Brooklyn College entry, entitled “Elevate Your Credit” as the winner. I am pleased to again congratulate Rasa Partin, Ben Remetz and Andrew Roder, and their coach, Jay Kim, for creating the winning video.

Governance may be seen as the manner in which power is exercised in the management of a country’s social and economic resources for development. We all know that good governance involves setting adequate policies, programs and regulations, which then have to be translated into legislation. As I often say, sustainable development hinges on the consistency of economic policies – there is no substitute for consistent, sound and stability-oriented economic policies. In this context, institutions are central to the way a country is governed and these are the formal and informal rules in a society. As the Nobel Prize winner Douglas North pointed out “the formal rules are set by the state through laws and regulations, while the informal rules come from the culture, history and experience of each society”. Only in the last 10–15 years most economists have discovered good governance – with its four pillars: transparency, accountability, predictability and participation – as a major determinant of economic growth. Thus, economic governance implies the need to ensure stable, transparent and predictable rules that encourage competition and fair access to public services. It is achieved through a country’s public and private sector institutions and the civil society. Moreover, the recent international crisis has underscored the need for an in-depth reform of economic governance at both European and global levels.
Lars Nyberg: Are the risks growing in the banking system? Speech given by Mr Lars Nyberg, Deputy Governor of the Sveriges Riksbank, at an analyst meeting at Enskilda Securities, held in Stockholm, on 14 June 2000. *  *  *  I would like to thank you for inviting me to today’s analyst meeting and giving me the opportunity to discuss financial stability issues with such a qualified audience. I would like to start by briefly explaining the Riksbank’s analysis of financial stability. In addition to the inflation target, the Riksbank has another primary task, namely that of being responsible for financial stability. These two important functions are closely linked. A stable financial system is important for price stability since financial imbalances can threaten the inflation target. Likewise, an inflation target policy contributes to stability in the financial system, as it has a levelling effect on cyclical fluctuations. The Riksbank’s analysis of financial stability can be interesting for analysts of bank and property shares, since we closely monitor the banking sector and property market within the scope of this analysis. Our perspective is somewhat different, however, since we are mainly interested in risks which can threaten the stability of the financial system and which often appear to be relatively improbable, while stock analysts attempt to assess the most likely developments in the market. However, the information about the markets is largely the same and analysts also need to consider the risks in the companies which they are covering.

2  BIS central bankers’ speeches  requirements by the end of 2014.4 At the same time, regulators are working on the establishment of resolution and recovery plans. When finalised, these plans should enable the regulators to secure the orderly resolution of a global bank in the event of a severe crisis and, in doing so, to make sure that systemically important functions can be maintained. As an important step towards this goal, FINMA has been authorised, since November 2012, to order a bail-in of creditors to generate the financial means necessary for restructuring a bank. Turning to cyclical risk, in June 2012, the Federal Council announced a set of measures consisting of three elements: (1) a permanent increase in risk weights for high loan-to-value mortgage loans,5 (2) a revision of the banking industry’s self-regulation guidelines for mortgage lending,6 and (3) the legal basis for the activation of a countercyclical capital buffer (CCB), as proposed in the Basel III framework. This instrument allows for a temporary increase in capital requirements when imbalances appear to be building up in the credit markets. It thus aims to increase the resilience of the banking system, and helps to lean against excessive credit growth. In February 2013, following a proposal by the SNB, the Federal Council activated the CCB, requiring banks to hold additional capital amounting to 1% of risk-weighted residential mortgage loan positions. Banks have been obliged to comply with this rule since 30 September 2013.
Denis Beau: For a contribution from our FinTech ecosystem to a more efficient and stable financial system Speech by Mr Denis Beau, First Deputy Governor of the Bank of France, at the FINTECH R:EVOLUTION 2020, Paris, 15 October 2020. * * * I would particularly like to thank Olivier Fliche for his contribution in preparing this speech. Ladies and Gentlemen, I am delighted to take part in this 5th edition of Fintech R:evolution and I would like to warmly thank the France Fintech association and its chairman Alain Clot for their invitation to speak today. This event, organised against the backdrop of the ongoing health crisis, is proof of the drive, determination and adaptability not only of the organising association, France FinTech, but also of the entire innovative French ecosystem of the financial sector, which is now represented here as widely as possible. The French FinTech ecosystem, like any ecosystem made up of start-ups, is fragile but it is promising and, I believe, vital to the financial sector. The economic crisis associated with the health crisis highlights these contrasting characteristics: on the one hand, start-ups may be weakened or innovative projects delayed by the economic situation; and on the other hand, the health crisis has accelerated the adoption of new digital habits by the entire population. More generally, 2020 has only served to underscore the challenges facing the financial ecosystem as a whole as a result of the digitisation of our economy.

Facilitating also means helping players in the ecosystem to engage with each other and find solutions without necessarily resorting to regulatory measures. It is in this spirit that we run the ACPR-AMF FinTech Forumand that we have created working groups or task forces in order to make concrete progress on important issues for the ecosystem, such as the access of digital asset service providers to the bank accounts and banking services they need. Admittedly, dialogue does not solve everything, but we very often find that many difficulties can be ironed out through improved dialogue and a better understanding of the practices and technologies used by the various stakeholders. Second objective: experiment. Here I would like to give two different illustrations of this approach. The exploratory workshops conducted by ACPR on the use of artificial intelligence in the financial sector are an example of what experimentation can bring not only to a supervisory authority but also to the entire ecosystem. Indeed, these concrete experiments have enabled the ACPR, based on specific use cases, to examine the code of the algorithms, their intrinsic performance, their integration into operational processes, and their control and governance environment. Drawing on this experiment, in order to share widely the lessons it has learned, the ACPR published astudy last June outlining what the framework for the proper use of these future tools could look like.