samchain/econo-pairs-v1 huggingface dataset:
To a large extent, the convergence of inflation to the 3% target in two years’ time is based on the assumption that the economy will continue to adjust the significant imbalances it accumulated in 2021. In the central scenario, the economy will grow below its potential for several more quarters, so that the gap will continue to narrow and will turn negative beginning at the end of this year. In this scenario, GDP will post annual variations between 1.75% and 2.25% this year, between -1.5% and -0.5% in 2023, and between 2.25% and 3.25% in 2024. For this three-year period, our projection contemplates a fiscal spending trajectory that is consistent with that described in the last Public Finance Report. Activity outlook foresees that private consumption will continue to tighten, a result that largely stems from the expiration of the massive income-support measures adopted in 2021, as well as from the tightening of monetary policy. About investment, weak performance is anticipated through the remainder of 2022 and all of 2023, reflecting less favorable financial conditions, increased business pessimism, a higher real exchange rate, and declining, albeit slowly, uncertainty (table 1). The current-account deficit will decrease in the coming quarters, in line with the continued adjustment of spending on tradables and a much more favorable savings-investment balance than in 2021. As income stimulus measures will not be repeated, both public and household 5  savings will improve drastically compared to 2021, triggering a significant drop in the current-account deficit from the second half of this year onwards.

For details, see Global Supply Chain Pressure Index (2) WTI-Brent average. (3) S&P GSCI Industrial Metals. (4) One-month futures prices. Sources: Bloomberg, and GSCPI of the NY Federal Reserve. 14  Figure 10 Financial conditions a) Currencies (*) (index, 1.Jun.22=100) U.S. Eurozone Chile Latin America  130  b) Interest rate on 10-year nominal d) Premios por riesgo país (CDS a 5 años) bonds (*) (difference with respect to 1.Jun.22, (difference with respect to 1.Jun.22, basis points) basis points) U.S. Brazil Peru Eurozone Mexico Colombia Chile Chile 130 Latin America 120  110  90 120  90  60  70  110  30  50  0  100  30  -30  90 Jun.22  Aug.22  10  -60 Jun.22  Aug.22  -10 Jun.22  Aug.22  (*) For Latin America, simple averages of exchange rates of Brazil, Mexico, Colombia, and Peru are used. Sources: Central Bank of Chile and Bloomberg. Figure 11 CPI and core CPI inflation forecast (w/o volatiles) (*) (annual change, percent)  CPI  14  Core CPI  12 10 8 6 4 2 0 19  20  21  22  23  24  (*) As from 2022Q3, forecasts are shown (dashed lines). Sources: Central Bank of Chile and National Statistics Institute (INE).
I consider this approach  BIS Review 40/2003  1  to be appropriate, as it fosters the desired degree of international standardisation of the rules, yet leaves enough room to take into account the specific features of each country and its legal system. In the macroeconomic policy sphere, the key set of international standards for monetary, financial and fiscal policies are embodied in the Code of Good Practices on Transparency in Monetary and Financial Policies and the Code of Good Practices in Fiscal Transparency, approved in 1999 and 2001 respectively. Among other things, these principles deal with the independence of central banks and financial regulators, restrictions on monetary financing of state budgets, greater transparency of policy-making, and data provision. These ideas have indeed had a marked effect in practice, and the first tentative conclusion is that they have helped to mitigate the international contagion of adverse shocks. In the financial regulatory and supervisory area the work to strengthen international standards has also been very intense. The key pillar here is the Basel Core Principles for Effective Banking Supervision, released in 1997. The ongoing work on the Basel Capital Accord, known as Basel II, is a well-known initiative for the future. Transposing all these standards into national legal and regulatory systems has become a key part of the newly founded FSAP, a joint programme of the IMF and the World Bank. In the anti-money-laundering (AML) area, too, the response to the recent challenges has taken the form of more rigorous international standards.

Øystein Olsen: Management of the Government Pension Fund Global (GPFG) Introductory statement by Mr Øystein Olsen, Governor of Norges Bank (Central Bank of Norway), before the Standing Committee on Finance and Economic Affairs of the Storting (Norwegian parliament), Oslo, 4 May 2015. *  *  *  Please note that the text below may differ from the actual presentation. I would like to thank the Chair of the Committee for the invitation to speak on the management of the Government Pension Fund Global. The objective of the Government Pension Fund Global is to underpin long-term considerations in the spending of government petroleum revenues. Norges Bank manages the GPFG with the aim of achieving the highest possible return subject to the framework defined by the Ministry of Finance, including the limitations set for risk-taking. The investment strategy is designed with a view to achieving this aim. The proportion of real assets in relation to nominal assets is the most important choice with regard to the investment strategy. Today, the allocation to equities is 60 percent. The proportion invested in real estate is likely to reach 5 percent in a few years. The Ministry of Finance has started work on assessing the allocation to real estate and the possibility of investing a portion of the GPFG in unlisted infrastructure. We have been requested to provide advice to the Ministry on this matter. Real estate investment, and infrastructure in the event, is more resource-intensive than securities investment, both in operational and management terms.
Of course, this is always a difficult task, since the increase in the precautionary demand for liquidity altered the behaviour of banks and rendered less efficient, at least temporarily, the forecasting models we use to calculate the benchmark need for liquidity. However, since the Eurosystem acted as a price taker during these liquidity injections, it is obvious that the interest rates at which these fine-tuning and longer-term operations were settled had no information content for the monetary policy stance. In a period of increasing inflationary risks stemming notably from excess demand for commodities and energy worldwide, it is crucial that our liquidity management is not misinterpreted and does not contribute to a deterioration of inflation expectations. Conclusion To conclude briefly, I shall invite you not to expect too much of monetary policy. Not only, to quote the Economist 2 , are we, central bankers, “only human”, but also, to put in more classical words, monetary policy alone cannot do everything with one single tool, the policy rate. A lesson that the subprime crisis has taught us is that a lot has still to be done in order to improve the regulatory framework in which the financial innovation process takes place. I have no time to develop this further, but I am confident that in particular the implementation of Basel II will bring significant improvements in the measure and management of risks, providing a sounder basis for the next wave of financial innovation. 2  Cf.

1/4  BIS central bankers' speeches  Despite all these headwinds we’ve been discussing, the ECB still plans to exit QE by the end of this year. What could derail these plans? That’s clearly what we anticipate. Now, that said, it will be data dependent – as with everything we do. But as we speak, in mid-July, I see no reason to change our expectations. There has been some confusion among investors about the ECB keeping rates on hold until “at least through the summer of 2019”; can you explain to us again what this means? “At least through the summer” means “at least through the summer”. It is date-based guidance, which so far we haven’t done, so it’s a step forward in enhancing our forward guidance. At the same time, it gives us enough flexibility to adjust depending on the data flow. Does that mean we could see a decision on rates as soon as September 2019? That’s not something I can comment on today, by definition; we did not discuss it in Riga. Could this actually come before the summer of 2019? Could we see any change of policies before then, depending on the risk we are currently seeing? The expectation is that rates will remain low, at the current level, at least through the summer of 2019. The ECB wants to keep this guidance quite vague at the moment? It’s not vague; it’s precise enough to anchor, to pin down money market rates. It has been, by the way, very effective.
This will be further accentuated by the current trends whereby financial intermediaries outsource activities both on a domestic and cross-border level, while the introduction of the European Union Directive on the European Single Company Statute, the so called Societas Europea, will present new regulatory and financial stability challenges on a regional level. The implications of international developments for Malta These observations are particularly relevant for Malta. First, whereas the size and complexity of financial intermediaries, and that of corporate entities to which they are exposed, has grown disproportionately relative to the resources available to regulators and liquidity providers across the globe, this divergence is magnified further in a small jurisdiction such as ours. Second, because the characteristics of the Maltese economy make it vulnerable to developments abroad, the financial sector is especially exposed to changes in the perceptions of foreign investors about the sustainability of prevailing economic policies and the capacity of the financial sector to absorb external shocks. 4  BIS Review 50/2004  Given the ease with which funds can now move in and out of the country, moreover, and the scope for disparity between the size of the economy and that of foreign institutional investors, the need to maintain confidence in the domestic financial sector assumes particular importance. This risk is further accentuated by the fact that while most sectors of the economy operate in a competitive environment, in many sectors business remains concentrated among a small set of market players. The financial sector is no exception in this regard.

Furthermore, while the structure of the domestic financial sector has evolved considerably over time, its level of development still falls short of that of the more advanced EU Member States. Thus, for example, although in the past few years the number of players in the non-bank sector has increased in terms of both number and variety, financial intermediation in Malta remains largely bank-based. Within the domestic banking sector, moreover, two banks together account for around 90% of total loans and deposits. A similar picture emerges in the capital market where the degree of capitalisation, the number of market participants and the volume of turnover are still relatively low. In 2003, for example, the ratio of stock market capitalisation to GDP stood at 37%. While this was higher than in most of the other new Member States, it was only around half of the euro area average. Annual turnover was even lower, hovering around 4% of GDP and 12% of stock market capitalization.
Monetary conditions are almost identical: three and six months Libor and Euribor rates do not differ by more than 50 basis points. I strongly believe that those three features – speed, innovation and cooperation – allowed central banks to play a decisive part in containing the crisis and limiting its impact. Has the crisis changed our vision of central banking? The credit bubble has already extracted heavy costs on our economies and the welfare of our citizens. All must be done to avoid the repetition of such developments. Bubbles are however complex phenomena: hard to detect, hard to prevent, hard to fight. Can we do better in the future and what contribution can central banks bring ? The crisis has revived the old, but ongoing, debate on whether monetary policy should aim, or not, at ensuring financial stability in parallel to its main objective of price stability. The arguments are well known, on both sides. New ideas are being brought, regarding, in particular, the impact of monetary policy on overall maturity transformation and leverage inside the financial system. It is desirable and healthy that this discussion takes place. Let me give you my own reflexion, at this stage: •  The primary and dominant objective of monetary policy should remain price stability. Any dilution of this fundamental mandate would be take us back three decades and be extremely detrimental to our welfare and prosperity in the long run. •  Without prejudice to this primary objective, all mandates allow for consideration of other objectives.

Zeti Akhtar Aziz: Fostering leadership role in Islamic finance Speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the launching of Hong Leong Islamic Bank Berhad - “Fostering Leadership Role in Islamic Finance”, Kuala Lumpur, 19 July 2005. *  *  *  Bismillahirrahmanirrahim Y.Bhg. Tan Sri Quek Leng Chan, Chairman of Hong Leong Bank and Hong Leong Islamic Bank Encik Daud Abdullah, Managing Director, Hong Leong Islamic Bank Ladies and Gentlemen, It is my pleasure to be here today to commemorate the official launch of "Hong Leong Islamic Bank Berhad". This establishment of the Islamic subsidiary represents the on-going institutional transformation in the Islamic banking system in our Islamic financial system. The underlying philosophy for the incorporation of an Islamic subsidiary is for the further strengthening the institutional structure for Islamic banking business operations. The emergence of Hong Leong Islamic Bank in the Islamic financial landscape will further increase the diversity of players in the Islamic financial system and enhance its potential to contribute to the further development of our Islamic financial services industry. Ladies and Gentlemen, Today, the Islamic financial services industry in Malaysia has emerged as a viable and competitive component of the financial system that contributes towards enhancing wealth creation and the nation's economic development. The advancement and progress that have been achieved thus far have opened new frontiers for the Islamic financial services industry.
And although at this stage it is difficult to define the magnitude and scope of these changes, it is essential they be identified promptly, since economic policy cannot provide indefinite support for firms that are headed for a structural reduction in their activity. Rather, it should aim to encourage and support the adaptation of the productive system to the new reality and the efficient cross-sectoral and cross-firm reallocation of resources. Moreover, the outlook for the Spanish economy and, therefore, for the business sector remains very dependent on the still highly uncertain course of the pandemic. Since the beginning of July, the strength of the recovery has been adversely affected by the fresh outbreaks of the virus in our country and, more recently, by the worsening of the epidemiological situation both in Spain and in most of Europe. This has prompted the relatively widespread introduction of new restrictions on mobility and activity in certain sectors. Accordingly, economic activity in this final stretch of the year and in early 2021 will foreseeably be less dynamic than was anticipated in the baseline scenarios published a few months ago by the Banco de España and the ECB for Spain and the euro area, respectively.2 By contrast, the latest news on the availability of a vaccine for early 2021 is clearly positive and, if confirmed, should help raise confidence and rule out the most adverse economic scenarios, even though the effects on activity will not be immediate.

In addition, financial institutions should maintain the limits on  3  working capital facilities up to that same date for all customers that have a guaranteed loan and comply with the eligibility requirements. This Royal Decree has also extended the insolvency moratorium, which was set to expire on 31 December this year, to 14 March 2021, with the aim of preventing firms that continue to experience temporary, pandemic-related financial difficulties from having to file for insolvency. This measure aims to reduce the risk of viable firms being eventually wound up, with the impact this would have both on the productive system and in terms of job losses. The available evidence suggests that the economic policy measures taken have helped to ease firms’ financing conditions, which contrasts with what was seen in the international financial crisis that began in 2008. It is a consequence not only of the swift and forceful economic policy response, but also of the better financial situation of the banking system and, in particular, of the larger capital buffers built up by the banks in recent years that have enabled them to absorb losses in their credit portfolios. The different nature of the current crisis has probably also been a determinant in this respect. In any event, since 2020 Q2 firms have resorted to debt on highly favourable terms to cover part of the increase in their liquidity needs. Specifically, between February and September, the outstanding amount of corporate sector debt rose by almost 5%.
 Low and stable inflation  Cannot affect employment and production  in the long term…  …except through providing conditions for  a good and sustainable economic development. 8  BIS Review 22/2008  In retrospect…  Not as easy as one might think  Monetary policy must be based on  forecasts  Much will happen between the forecast and the final outcome Uncertain data?  Monetary policy considerations?  Unpredictable events?  Poor forecasting?   What demands can one make?  On average, not poorer accuracy  Consistency between different  variables  The driving forces should be explainable  BIS Review 22/2008  9  Other reasons for deviations  Normally we try to reach the target  within 2 years  May deviate deliberately  Considerations for the real economy  Must be communicated clearly  So how did it turn out? CPI and CPI-forecasts Annual percentage change 3.5  3.5 CPI  3.0  3.0  Forecasts  2.5  2.5  2.0  2.0  1.5  1.5  1.0  1.0  0.5  0.5  0.0  0.0  -0.5  -0.5 03  04  05  06  07  Sources: Statistics Sweden and the Riksbank  10  BIS Review 22/2008

It is unclear what the net impact will be, but if all firms pursue the same strategies in search of higher risk-adjusted returns, greater similarity could result. This pressure is potentially stronger now than in the past due to the highly competitive nature of banking and this is an area for further study. Technology A third theme is the emergence of “fintech”, which I think of as the intersection between technological innovation and the provision of financial services. While innovation has always been a competitive driver in banking, there is a sense that both the pace of change and the potential impact have become more pronounced. As prices for technology services and capacity continue to fall and technological opportunities expand, more firms are able to adopt and leverage the latest technological breakthrough. Scale is likely to remain a relevant factor in the deployment of the latest technology, but, at least among the largest firms, the playing field may be leveling as firms have the opportunity to benefit from direct investments, consultants, and third-party vendors offering the latest services. If the largest financial firms are responding to the same technological forces and pursuing the same opportunities, one might expect their resultant strategic choices to contribute to greater similarity over time.8 Again, this is an empirical question that deserves further inquiry. Next Steps An important next step is to look at the data to assess whether recent industry trends are consistent with the premise that large banks are becoming more similar.
During the 19th century, debt appears to have played just this role. Depositor flight and bank runs came thick and fast, operating as an effective disciplining device on shareholders and managers. That is why unlimited liability remained a prize asset until the end of the 19th century. This quasi-disciplining role of debt persisted up to the Great Depression. Calomiris and Mason (1997) find that debt and equity prices did a reasonable job of distinguishing good and bad banks during the Chicago banking panic of 1932. Indeed, they signalled distress fully six months prior to banks’ failure. As the 20th century progressed, however, evidence of debt disciplining became patchier. Studies in the 1980s typically failed to find balance sheet risk having a significant impact on banks’ subordinated debt spreads (Gorton and Santomero (1990)). Evidence from the 1990s was more encouraging (Flannery and Sorescu (1996), Morgan and Stiroh (1999)). But even then the link was weaker among larger banks, with little evidence of market prices influencing banks’ risk decisions (Bliss and Flannery (2002)). Nowhere was the ineffectiveness of debtor discipline better illustrated than in the run-up to the recent financial crisis. Chart 6 plots CDS premia for a sample of 33 large international banks over the period 2002 to 2011. It partitions the sample into “crisis” and “no crisis” banks, where the former are institutions subject to government intervention during the crisis. CDS premia for all banks fell dramatically between 2002 and 2007, on average by around three-quarters.

Through in-depth market knowledge of the financial services industry, it will without doubt spur greater innovation in Islamic financial services, leading to cutting-edge products and services. Equally important, it is also expected to enhance linkages between the Middle East and Asian regions, acting as a conduit to promote greater economic integration and encourage deeper intermediation of Islamic markets. This further underscores the economic integration of both the Middle East and Asian regions and further enhances linkages in the New Silk Road, a manifestation of the thriving global Islamic finance market. Ladies and Gentlemen, On this occasion of the official launch of Kuwait Finance House Research, it is with pleasure that I congratulate Kuwait Finance House for its forward-looking outlook and commitment to contribute to the success of Islamic finance by allocating resources in having a dedicated research entity to drive its Islamic banking business forward. It is my hope that Kuwait Finance House will continue to play a major role in the initiatives to further develop Islamic banking both here and in Asia. I wish Kuwait Finance House Research every success in its endeavours. In the name of Allah, Most Gracious, Most Merciful, it now gives me great pleasure in officiating the launch of Kuwait Finance House Research. Thank you. 2  BIS Review 48/2007