samchain/econo-pairs-v1 huggingface dataset:
By structural change, I mean not only domestic consolidation, but also increased cross-border cooperation and mergers. In short, the euro area banking sector is expected to look and behave more like the banking sector of a single economy in the future. Economies of scale and scope may have been changing in different areas of banking and may even have taken different directions. However, the general picture is that the banking industry needs to be in a position to adjust to a new reality. Indeed, since the introduction of the euro, a number of bank mergers in the euro area, including mergers between relatively large institutions, have been announced. Such “high-profile” mergers are likely to contribute towards an acceleration of the pace of both the consolidation and integration process of the banking systems in the euro area. The recent pattern of consolidation constitutes a continuation of a longer-term trend in the European banking industry, as is highlighted by the large decline in the number of credit institutions in the euro area countries over the past decade or so. In the mid-1980s, there were more than 11,000 credit  3  BIS Review 83/2000  institutions in the euro area countries, compared with around 7,500 now. This reflects a decrease of 3,500 credit institutions over 15 years, or an average annual decrease of around 230 institutions. The changeover to the single currency seems to have intensified the consolidation trend in the euro area banking sector.

And third, the expansion of that work into the current international effort to develop and implement a single global code of conduct for the foreign exchange market and to enhance adherence to that code among all market participants. Work of the Financial Stability Board’s Foreign Exchange Benchmarks Group (FXBG) Given the global nature of the FX market, as well as the number of jurisdictions in which wrongdoing has been uncovered, efforts to strengthen the market must be global in nature as well. Recognizing this imperative, the Financial Stability Board (FSB), an international body that monitors and makes recommendations about the global financial system, established the Foreign Exchange Benchmarks Group (FXBG) in early 2014. The purpose of the FXBG was to review FX benchmarks and associated market practices, including potential misaligned incentives, and make recommendations for change. The FXBG, which consisted of representatives from more than twenty countries, engaged with a range of market participants to analyze the market structures and incentives as they related to trading around benchmark fixings. The group produced a series of recommendations to enhance the structures and behaviors around FX benchmark trading. I would like to focus on two particular aspects of these recommendations – first, changes to the WM/Reuters calculation 10 and second, changes aimed at strengthening market conduct. The FXBG report highlighted the dominant use of the WM/Reuters (WMR) 4 p.m. London fixings by many different sets of market participants, including some not otherwise active in the foreign exchange market.
Overall, I believe that Europe has the ability to meet the challenges that the western world faces, if it is able to make full use of its own experience and institutions. Changes are nevertheless needed. And this brings me to the questions specific to Economic and Monetary Union. 2  BIS central bankers’ speeches  In this regard, I would like to make two main points: first, the global economy is becoming increasingly “multipolar” and the euro will have to stand its ground alongside at least three – and possibly more – other major international currencies. Second, the euro can only be assured of a major role in a multipolar currency world if the architecture underlying the single European currency is sufficiently strong. The task of achieving this cannot be delegated to financial markets and requires appropriate institutional steps. The euro in a multipolar world When the idea of the single currency was first mooted in the 1980s, the global economy was dominated by three countries: the United States, Germany and Japan. Since then, the global economy has seen major changes. With the ongoing integration of global markets, we have witnessed the rise of emerging market economies. China, in particular, has led to a progressive shift in the centre of economic gravity and is expected to overtake the United States in terms of GDP at market exchange rates sometime from 2025 onwards.

Conclusions  Let me conclude by quoting David Marquand’s recent book, “The end of the West”:4 “The economic crisis itself, like its predecessor in the 1930s, is political, not technical….The world’s economic blocs will have to find painful answers to urgent problems; and the allocation of the pain will be a supremely high-political matter. It will raise profound questions of distributive justice, of the obligations that the present generation owes to future ones, of the proper balance between the claims of poor and rich nations, and of the proper relationship between the human and other species. Such questions are quintessentially global in character, and the answers will have to be global too. But for the Union’s leaders to opt out of the global search for answers would be a betrayal of their citizens. And they will be unable to opt in if they cannot speak with one voice and lack the democratic legitimacy to carry their people with them.” Lastly, I would like to praise the organisers of this Festival of Europe Conference for having chosen Florence as the place to debate such important issues related to the future of our continent, as I like to think that one of the best way to symbolize Europe is the David (by Michelangelo): young, vigorous but also gentle, his gaze fixed fearlessly on the challenge; he can triumph, against all odds. That’s the way Europeans should be. Thank you for your attention.
However, credibility is about the long term, about consistency, and about actions rather than words. We have the second-highest international reserves in Europe after Switzerland. A strong central bank is now a firm anchor in the economy. Over the next six years, monetary policy should be more restrictive, or rather interest rates should be higher, than in the, say, six to ten years before Covid. We need to motivate people, firms and also the government to save. It's the only road towards less debt. This is the first policy for a strong koruna. Second policy for a strong koruna – fiscal policy Inflation was last at the CNB's target in 2018, a period when public finances were in a surplus. In 2017, the public finance surplus in the Czech Republic was 1.5% of GDP. In 2018 it was 0.9% of GDP and in 2019 it was 0.3% of GDP. That is no accident. 2/4  BIS - Central bankers' speeches  Defeating inflation is conditional on monetary and fiscal policy coordination.6 The key question is: will the higher inflation observed after Covid be persistent? The answer depends not only on monetary policy, but also on the government's credibility regarding its willingness to stabilise debt. If fiscal policy generates rising deficits, monetary policy alone cannot ensure permanently low inflation. If the central bank increases rates, it will cause a recession. In an entitlement economy, the government will attempt to compensate people for the recession with accommodative fiscal policy. This in turn will fuel inflation.

More accurately, what is needed for the koruna to start following an appreciation trend again, like it did before 2008? You can view this as a mathematical equation with three variables. x + y + z = strong koruna I define these three variables as monetary policy, fiscal policy and long-term growth policy. To achieve the result, all three variables, the three policies, x + y + z, must act together, in concert and at the same time. It's not enough to have just one of them. First policy for a strong koruna – monetary policy Monetary policy affects economic activity with a lag of more than a year. This lag complicates the decision-making and communication of inflation-targeting central banks. Let's assume there is no lag in transmission. In that case, it would be enough to stop raising rates as soon as core inflation stabilises, or even better, when it starts falling. However, it's different in reality. Because of the transmission lag, the central bank should correctly stop raising rates before inflation peaks.3 The problem of this  1/4  BIS - Central bankers' speeches  academically and practically correct approach is that people can see that inflation is still high and might think that the central bank is not determined to fight inflation because rates have stopped rising. The economically incorrect approach of raising rates until cost-push inflation turns around leads to an overshooting. The resulting recession will be deeper than necessary.
In an effort to continue to shed light on the important issues, last week we published in our Liberty Street Economics blog a five-part series entitled “Restoring Economic Growth in Puerto Rico.” Some important conclusions emerged from our analysis, and I want to emphasize those today. First and foremost, Puerto Rico’s current level of public debt is unsustainable. Achieving fiscal sustainability requires real reforms and a significant adjustment to the Commonwealth’s debt burden, as Congress and the Administration have recognized. To illustrate this point, our analysis demonstrates that even if growth were to return to between 2 and 2.5 percent per year – an optimistic scenario – debt as a share of GDP would continue to rise under the 2  BIS central bankers’ speeches  current fiscal balance and debt structure. This underscores that the current regime is not sustainable. Second, while fiscal reform is definitely needed, restoring economic growth remains a crucial ingredient to achieving a sustainable fiscal regime. Puerto Rico slipped into recession in 2006, and a decade later a recovery has yet to materialize. Any fixed level of debt will grow even more burdensome if the economy is shrinking. Consequently, this long deep recession has exacerbated the Island’s fiscal woes. Much of last week’s analysis focused on a key contributor to economic growth – the labor force – so let me point out a few conclusions that I drew from that work. Puerto Rico’s outmigration remains an important concern, and is both a cause and an effect of the economic decline.

Fiscal and monetary policies are but tools to achieve these goals. Government policies can play a vital role in providing a stable and predictable macroeconomic environment for investors, which is why the policy horizon is long-term. Monetary policy is anchored on the pegged exchange rate to the Dollar, so interest rate risk premia over the Dollar can be kept low and investors have confidence to commit long-term funds. The result of this long-term success is that Riyal financing is available with no currency risk and at attractive interest rates. Saudi Arabia’s fiscal policy provides a stable background for investment. It works on countercyclical basis, so that it runs budget surpluses when times are good, as at present, so as to allow for deficit spending to keep the economy on a steady growth track when global demand for oil weakens. The result is that Saudi Arabia currently has a very low debt/GDP ratio (less than 10%). Saudi Arabia also has favourable tax rates for businesses (such as a maximum 20% rate on foreign enterprises) with no capital controls on remittances abroad. The government provides support for investment projects besides developing a supportive legal and arbitration structure. In summary, Saudi Arabia’s economic policy remains cautious and long-term and provides global investors with an ideal backdrop for allocating their capital to the different sectors of the Saudi economy. 2. Financial stability  A sound financial system is the backbone of an economy. Indeed, banking crises tend to be very costly to the exchequer and taxpayers.
Currently, the portfolio of euro area households at the age of retirement is tilted towards real estate rather than financial assets, especially in the Mediterranean countries. There are, however, various financial products that can be used to extract liquidity from real estate assets. 13  For example, reverse mortgages are loans, guaranteed by the borrower's property, in the form of either a lump sum or a regular income stream until the accumulated debt reaches the loan limit, which is a fraction of the property value. Other forms of reverse mortgages include the possibility for borrowers to borrow funds as they need them up to a pre-agreed limit. Another option is the so-called sale and leaseback contract. In this case the ownership of the dwelling passes to the cash provider who in turn leases the property back to the seller. Some of these products could be combined with annuities, which are insurance products that guarantee an income stream for life. However, in the era of low interest rates the income stream per unit of asset is comparatively low, and tends to decrease even further with the increase in life expectancy. These changes in the demand for financial products could have implications for the structure of the financial system. The traditional role of banks in their intermediation of funds from short-term deposits to loans may diminish.

9  Let me now turn to the implications of demographic changes for the balance of savings and investment and, thus, for the so-called natural rate of interest, something that for obvious reasons is very closely followed by central banks. Savings are likely to increase with population ageing, as people need to devote more resources to retirement. Moreover, the demand for investment is likely to be lower as the population ages, a trend that will also be made more acute by the nature of the technological changes we are witnessing and that seem to require more intangibles and fewer traditional capital goods. No wonder that most estimates point to a significant decrease in the natural rate of interest in recent decades, one closely associated to demographics: among the main factors potentially behind the course of the natural rate (which also include technological growth and changes in risk premia), it is clearly the demographic component that accounts for its low-frequency changes. This decline in the natural real of interest has significant implications for monetary policy. A low natural real interest rate, together with the deflationary pressures associated with the same demographic and technological factors behind low interest rates, imply a higher probability of nominal policy rates hitting their effective lower bound, or alternatively the socalled reversal rate (i.e. the level below which further rate cuts may become contractionary), thus hampering the ability of conventional monetary policy to stabilise the economy.
What I am objecting to here is not that the forecasts are adjusted with assessments that take into account factors that affect the forecasts but are not captured in the usual models. On the contrary, I have always advocated such an approach and have even discussed how this can be done more systematically in a number of research papers. 7 I think that it is quite correct to take into account house prices, indebtedness, imbalances and so on to the extent that they affect the forecasts for inflation and the real economy. All information that affects the forecasts is relevant. The problem arises when one allows these factors to undermine target attainment for inflation and resource utilisation. In practice, this gives them the status of separate targets for monetary policy. This makes monetary policy unclear and hard to understand. Moreover, as I see it, the Sveriges Riksbank Act and its preparatory works do not provide scope for any other targets for monetary policy than inflation and resource utilisation. 8 I believe that it is important that the Riksbank’s decisions and communication in the future do not give the impression that monetary policy is focused on anything other than inflation and resource utilisation. In their 2006 evaluation of Swedish monetary policy in the period 1995–2005, Giavazzi and Mishkin (2006) also say that the Riksbank’s statements on housing prices led many people to perceive the Riksbank’s message as confusing, which made things unclear and undermined confidence in monetary policy.

12  The Global Documentation Steering Group (GDSC) is an industry group formed in 1999 to implement the documentation-related recommendations of the report of Counterparty Risk Management Policy Group (CRMPG). The primary objective of the Committee is to encourage the harmonisation of documentation in standard over-the-counter contracts in order to minimise disparities that can exacerbate market, credit and legal risk. It took the lead in updating the recommendations on documentation issues for the second CRMPG report released in 2005. GDSC is sponsored by, but independent of, the Federal Reserve Bank of New York. The hedge fund community is represented on the GDSG. The Stock Lending and Repo Committee, facilitated and chaired by the Bank of England, provides a forum for practitioners and the authorities to discuss structural (including legal) developments in London-based securities lending and repo markets. 6  BIS Review 44/2007  At the macro end of the spectrum, that above all means credible monetary regimes. The MPC is now ten years old. During that period, inflation expectations have been well anchored to our target. And no one should be in any doubt that the Committee is determined to keep it that way. But a credible monetary regime does not insulate the economy, or financial markets, against all shocks. Over the coming decade, some currently observable imbalances will plausibly work their way through the system, as the pattern of global saving shifts, asset prices adjust, and we encounter, eventually, a period of corporate defaults.
We note that whereas most of our colleagues from Francophone countries are able to speak English fluently, our employees cannot even exchange a simple greeting in French without the aid of an interpreter. As you are well aware, Your Excellency, Zambia has eight neighbouring countries amongst whom, at least, one is French speaking; two are Portuguese speaking and the rest are Anglophone. As neighbours and countries falling under the same sub-regional and regional groupings, we collaborate a lot amongst ourselves on a number of regional cooperation agreements where inability to speak, read or write French or Portuguese is sometimes a major communication barrier. For instance, in Africa Zambia belongs to three regional groupings, namely SADC, COMESA and the African Union (AU). All these groupings include Francophone member states, and, at times, our interests, as a nation, have not been well articulated to our Francophone counterparts in these regional groupings due, in part, to our inability to communicate effectively in French. Further, as I stated earlier, Zambia shares a border with one of the largest and populous country in Africa - the Democratic Republic of the Congo (DRC) - where the official language is French. However, in spite of being neighbour to this huge market, Zambian enterprises have not captured the enormous business opportunities offered by the DRC, largely, on account of their inability to communicate effectively in French. The same also applies to Angola where there is a huge reconstruction programme going on, in which Zambian enterprises could participate.

Before I end my remarks, I thought it worth emphasising again the importance of greater collaboration between statisticians, compilers and end users of statistics in improving data compilation, communication and its usage. In this respect, I believe that MyStats will be a strong foundation to facilitate and enhance this collaborative effort. On that note, I wish you a productive and engaging conference. BIS central bankers’ speeches  3
It is therefore important for our banks to continue the enhancement of the quality of the asset side of their balance sheets, bridging the gap with our European peers. European Banks are also facing emerging risks beyond the traditional business model risks I just mentioned. I will focus on the three I consider as the most prominent ones. The first one is the exposure to climate-related and environmental risks, which will be one of the main concerns for both supervisors and banks in the years to come. The transition to a green economy comes at a cost and this will affect the banks through various channels, the most prominent one being their exposure to businesses that produce high carbon emissions. It is therefore of paramount importance for banks to develop appropriate strategies and risk management practises to alleviate the longterm, direct and indirect, effects of climate change. From the regulatory perspective, we are conducting for the first time a climate related stress test for the Significant EU bank Institutions and we are also planning to carry out both on site and off site inspections to assess the readiness of the banks to deal with this type of risks. Let me be clear; both banks and supervisors are still on the learning curve with regard to climate-related and environmental risks. However, we both need to adapt and we need to adapt as soon as possible. The second emerging risk, is the IT and cybersecurity risk.

Compared to the start of the year, the expected timing of any further Fed interest rate hikes has been pushed back, and the expected upward trajectory of U.S. short-term rates is now much flatter. There are several reasons to explain these shifts. First, assessments of the neutral real shortterm interest rate have declined as economic growth has consistently fallen short of consensus forecasts. With the U.S. economy having grown at only a 2.1 percent annual rate over the past seven years, it has become harder to sustain the view that the neutral real short-term interest rate is close to, or will soon be close to, its historical level of around 2 percent. Estimates of the neutral real short-term interest rate obtained from many of the DSGE models used within the Federal Reserve System are currently clustered around zero, and this seems reasonable to me. An implication is that at present there is only a small gap between the actual real shortterm rate of about -1 percent and the neutral real short-term rate. In other words, U.S. monetary policy is accommodative, but only moderately so. In addition, I suspect that many have come to question the view that headwinds from the financial crisis are temporarily depressing the neutral short-term rate, and that the neutral short-term rate will significantly rise in the near-future as these headwinds dissipate.