samchain/econo-pairs-v1 huggingface dataset:
Ten years of historically low interest rates and large-scale asset purchases give cause for reflection. An important question is what responsibilities should rest with a central bank. A related theme is what is meant by the objective of low and stable inflation. Chart: Inflation in Norway The primary objective of monetary policy is to maintain monetary stability, as part of the central bank’s responsibility for the monetary system. Inflation that is either too high or too low has undesired consequences, such as arbitrary wealth redistribution, underinvestment and resource misallocations. The result is lower activity and lower welfare. Since 1990, an increasing number of countries have chosen to link monetary stability to a numerical inflation target. Since the financial crisis, all of these countries have maintained their inflation targeting regimes. This reflects the overall positive experience with this framework. It did not get in the way of a powerful response to the financial crisis. In Norway too, inflation targeting has functioned well. Inflation has remained low and stable since it came down in the early 1990s, and the inflation target has anchored inflation expectations. During the period of inflation targeting, the Norwegian economy has been exposed to major shocks. A flexible inflation targeting regime has helped dampen their impact on output and employment. Employment variability has been lower since 2001 than in previous periods. 1/4  BIS central bankers' speeches  Lessons have been learned along the way. Initially, central banks had high ambitions to steer inflation to target within a clearly defined time horizon.

They include the SLIPS system which is also owned and operated by LankaClear and the $ clearing system operated by a commercial bank. Mr Anura de Silva, General Manager LankaClear will give you the technical details of the CIT System including some of the glitches that have surfaced in implementing the cheque imaging project. Let me now deal with the institutional and legal arrangements and the impact of payment reforms very briefly. The focus will be on (i) the market arrangements for payment services (ii) the legal and regulatory framework; (iii) the coordination of oversight of the payment system and regulation affecting the system; and (iv) mechanisms for consultation with stakeholders. The RTGS and SSS systems speedily transfer funds and make settlements of banks, primary dealers, financial institutions, investors, customers, the government and the public. These two systems bring about financial discipline among these stakeholders as they have to maintain adequate cash and reserves in their accounts to meet payment obligations. This also improves the liquidity management by banks as treasurers and fund managers have to produce accurate estimates of their daily liquidity requirements. More importantly, the users of the RTGS and SSS systems can use Central Bank funds throughout the day for settlement purposes and return them at the end of the day. Subject to the availability of acceptable collateral, the banks and primary dealers are provided with intra day liquidity by the Central Bank.
As I noted in my introduction, the fact that I am pointing out these rather subtle and technical discrepancies is only because I have chosen to highlight various correlations over the past decade by using monthly data. In Swedish statistics, there are monthly data on job openings, while job vacancies are only reported quarterly. Even though it would be desirable in many ways to use vacancies, I therefore have to use job openings as an approximation. If we look at the data, it does not make much difference in this context, but it can still be good to know that I am simplifying a little here as job openings and job vacancies are not really the same thing. If we now view job openings as a measure of labour demand, we could see the relationship between job openings and wage increases as a kind of inverse Phillips curve. In the same way as the relationship between wage increases and unemployment can be expected to be negative, the correlation between wage increases and job openings should be positive. 9 [16]  Figure 5. Wage increase and job openings  Wage increase  Annual percentage change and as a share of the labour force 5  5  4  4  2007  3  3 2018  2011  2  1  2  0  0.5  1  1.5  2  2.5  1  Job openings  Note. Moving averages over 12 months.

The Phillips curve – central but controversial Allow me to begin with the correlation that is normally called “the Phillips curve”. The name comes from the New Zealand economist, William Phillips, who, in an article in 1958, showed that there was a negative correlation between unemployment and wage increases in British data for the period 1861–1957. High unemployment tended therefore to be associated with low wage increases and vice versa, as in Figure 1. When many people compete for jobs, demand for higher wage increases falls while a shortage of labour leads to greater wage increases. 2 [16]  Wage increase  Figure 1. The Phillips curve  Unemployment  Subsequently, the Phillips curve concept was broadened to accommodate slightly different, though similar, correlations. In 1960, two American economists, Paul Samuelson and Robert Solow, both awarded the Prize in Economic Sciences in Memory of Alfred Nobel, reformulated the curve in terms of unemployment and inflation rather than unemployment and wage increases. As there is a close relationship between unemployment and output, the Phillips curve was also often formulated in terms of the correlation between inflation and output – or, as it is commonly expressed nowadays, resource utilisation. But it is basically the same thing we want to identify, namely a correlation between economic activity and the rate of increase in prices and wages. For a time, the Phillips curve was interpreted as economic policy-makers being able to choose a combination of inflation and unemployment.
Christian Noyer: A review of the financial crisis Speech by Mr Christian Noyer, Governor of the Bank of France, at the Hearing before the Finance Commission of the Assemblée nationale, Paris, 7 October 2008 (updated 15 October 2008). * 1. *  *  A number of comments on the developments of the past month  The bankruptcy of the investment bank Lehman Brothers on 15 September 2008 marked a crucial turning point in the crisis. The direct consequences of this failure, involving over USD 600 billion in assets, appear to have been correctly contained and managed up to now. Nevertheless, it exacerbated the crisis of confidence, with the following major repercussions: •  first, interbank markets increasingly seized up, because banks perceived there to be a rise in counterparty risk. Overnight dollar interbank rates rose to particularly high levels of close to 7%;  •  second, significant pressure on other money market segments, in particular the US commercial paper market, where yields on 30-day paper have been climbing since mid-September to reach levels close to those observed at the end of last year;  •  lastly, the deterioration in the financial position of AIG, the largest US insurer, followed by its exceptional bailout. A two-pronged rescue plan was implemented: on the one hand, the Fed made an USD 85 billion loan at a penalty rate of three-month Libor plus 850 basis points and, on the other, the US government took a 79.9% stake in the company.

But this partly reflects the weight of past decisions and specific factors relating to the reintermediation, by banks, of previously securitised loans. •  All surveys point to a tightening of credit standards going forward. “Tightening” does not mean that credit will dry up, but rather that it will be more expensive and more selective. Banks are gradually passing on to their customers the increase in the cost of financing that they incur. •  We are closely monitoring this development that, at present, does not appear to be, in itself, a threat to growth. Indeed, the recent period had been characterised by an extremely high credit growth rate. As you know, the government has implemented measures to facilitate the financing of SMEs. To conclude, in the longer term, and in accordance with the guidelines laid down by European governments on 4 and 12 October 2008, I believe that it would be useful to revisit the foundations of our financial regulation. This should be done without haste, but no stone should be left unturned. We must be willing to address all the questions and challenges that this crisis has raised. These include the role of credit ratings agencies, the management of risk, market infrastructures, the scope of financial regulation and the question of remuneration. As regards the latter, we should not seek to over-regulate or punish, but rather to instil a sense of responsibility. Pay structures should not encourage short-termism or, as was the case, excessive risk taking. BIS Review 129/2008  3
This crisis could generally be described as a dramatic end to almost twenty years of stabilisation policy problems. The Swedish economy had been characterised by an unsustainable rise in costs, which had originated in price and wage increases that constantly came on a collision course with the fixed exchange rate. The result was repeated devaluations, modest economic growth, poor productivity growth and more or less stagnant growth in real wages. The performance was markedly weak both compared with earlier periods and in relation to other countries. During the crisis years the situation was aggravated further. Unemployment increased fourfold in the course of a few years and the central government finances deteriorated dramatically. Interest rates rose unchecked and the interest rate differential vis-à-vis Germany occasionally came to several percentage points. Favourable results Today, a little more than ten years after the crisis, the situation is completely different. The new focus of stabilisation policy – which involved crucial changes in the framework for both fiscal and monetary policy – has meant that inflation now remains relatively stable around the target of two per cent (Figure 1). The lower inflation rate has not been associated with weaker growth in output, rather the opposite. GDP growth has averaged roughly half a percentage point higher a year in the past decade than in the two previous decades, and the fluctuations in the real economy also appear to have lessened (Figure 2).

Of course, I was a little uncertain as to whether I should just be pleased about this. But I think there is reason to be; it shows namely that we have a monetary policy regime which is stable and not dependent on single individuals. Inflation targeting – some thoughts on the future As I have mentioned, the macroeconomic outcome for Sweden has been relatively good over the past decade. Of course, this does not prevent there being questions worth discussing and much that can be improved. This also applies in the field of monetary policy. An important question in this context is what one can expect from monetary policy. If the expectations are excessive, there is a risk they will lead to the wrong issues being discussed and, if the worst comes to the worst, to political discontent that will undermine the current monetary policy system. Reasonable expectations According to the Sveriges Riksbank Act, the Riksbank is to safeguard price stability. We have chosen to implement this by keeping inflation at a target level of 2 per cent. The fact that the legislator has been clear that low inflation should be the target for monetary policy and nothing else, such as high growth or low unemployment, is because inflation is the only factor the Riksbank can govern in the long term. It is therefore unwise, and perhaps even counterproductive, to give a different impression.
Supply chains  Page 7  continue to be disrupted owing to the fall-out from the pandemic and invasion of Ukraine. For each firm that reports difficulty in obtaining components necessary for production, there is a supplier facing strong demand with significant pricing power and the ability to pass higher costs along the value chain. In this context, one way of viewing the interaction between external price shocks and domestic price, wage and cost pressures would be to see the two stories as additive. UK inflation is high both because of the direct and indirect impact of higher international energy and goods prices and because of the impetus to domestic inflation imparted by the strength of wage growth and corporate efforts to re-establish profit margins. An alternative and more worrying view would characterise the impact of the two drivers of UK inflation as multiplicative. The strength of corporate pricing power, the tightness of the UK labour market, and the real income squeeze on UK households owing to higher energy prices all make it more likely that the impact of higher international goods and energy prices will extend beyond the direct and indirect effects that I have already mentioned, and translate into second-round effects on price, wage and cost setting behaviour. In other words, UK price setters and wage bargainers will try to offset the impact of higher headline inflation on their real spending power by seeking higher profit margins or higher wages in order to preserve their real income.

Drivers of today’s elevated inflation If that commitment is as strong as I claim, it begs the question of how we have ended up in the current situation, with inflation so uncomfortably high. Answering that question requires we delve a little further into recent economic developments – peeling another layer from the onion. The character of external shocks In large part, recent price developments have been driven by a succession of unanticipated external disturbances to the UK economy – among others, the Covid-19 pandemic and its aftermath, and the Russian invasion of Ukraine. In the jargon of economics, we label this ‘a sequence of adverse external shocks’. Four features of these disturbances are worth emphasising. First, they were genuine ‘shocks’ in a specific, technical sense: they were not (and could not have been) anticipated. [5] Second, they have transmitted into UK inflation relatively quickly. For simplicity, I’ll focus for a moment on the impact of higher international oil and gas prices on UK consumer price inflation. [6] The direct implications of these external shocks for UK price developments transmits within a matter of months. Even with the added complications implied by the OfGEM price cap, higher European wholesale gas prices entered UK utility prices – and thus UK CPI inflation – within six months. Moreover, many of the subsequent indirect implications of higher international energy prices – that is, their impact on a wider set of UK goods and services prices, via (say) higher transport or utility costs – are already also being felt.
One reason is the rapid policy response here in the UK and worldwide, which communicated to businesses that policy-makers were actively seeking to reverse the downturn in demand – using monetary policy, fiscal policy and direct interventions in the financial sector. This contrasts with earlier recessions in the UK in which the downturn was preceded by a surge in inflation and economic policy could not be relaxed so readily because of the need to bear down on inflation. 6  The total number of people aged 16 or more in employment was 29.19 millions in July-September 2010 according to the Labour Force Survey, compared with 28.84 millions in January-March 2010. 7  The latest Labour Force Survey measure of unemployment is 7.7% of the workforce. By contrast, unemployment peaked at 11.9% in mid-1984 and 10.6% in early 1993. Approximately two years after the start of the recession in both cases, unemployment was 10.2% at end-1981 and 10.4% at end-1992. 8  The latest figures available show public sector employment falling from a peak of 6.10 millions at the end of 2009 to 6.05 millions in June 2010. BIS Review 158/2010  5  Another factor supporting employment has been the flexibility in wages and working hours which helped companies weather the stresses and strains of recession. Many companies imposed or negotiated pay freezes, and in the downturn employees were willing to accept reduced working hours or a pay sacrifice in order to help preserve their jobs.

Bank of Thailand’s Monetary Policy: Navigating towards Sustained Growth Veerathai Santiprabhob, Governor of the Bank of Thailand Thailand Focus 2018 August 29, 2018 Ladies and gentlemen, It is my pleasure to be addressing you this morning. I will take this opportunity to speak to you about Thailand’s economic outlook and monetary policy at this important time. But before I move on, I would like to first thank the Stock Exchange of Thailand for hosting this event, and all participants for your interest in the Thai economy and the Thai capital market. This is an important time, not only for the global economy, but also for the Thai economy. After five years of sub-par growth rates, Thailand has managed to restore economic growth to its potential. As the economy moves from a recovery phase towards an expansionary phase, the role of macroeconomic policy needs to evolve accordingly. What used to be a stimulative tool will eventually have to transition into a support on which the economy could grow on a sustainable basis. Furthermore, we need to step up structural reform policy to address long-term challenges. Ladies and gentlemen, The turning point of macroeconomic policy stance is not a straightforward one. Imagine yourself on a road trip with a group of friends.
Nevertheless, I believe that more must be done in this field, especially since at least some parts of the world economy have seen something of a productivity shock in recent years. I am deliberately avoiding the buzzword “new economy” here, since history has been full of expressions like that ever since the turn of the 19th century. The discussion about monetary policy and a productivity shock is taking place mostly in the United States, in the light of the impressive economic performance there and the acceleration in the rate of productivity growth. So one could certainly ask: what about the rest of the world? The possibility of a productivity breakthrough also in other parts of the world cannot of course be ruled out. Higher - or accelerating - productivity growth does indeed pose new challenges for monetary policy. It could set in motion a complex of effects on aggregate supply and demand, on inflation, equity prices and interest rates. Just to give a few examples, let me briefly mention the following effects. First, a positive productivity shock raises the economy’s potential growth rate. It also affects aggregate demand through new, profitable investment opportunities, higher equity prices and expectations among households of higher permanent income. One question for policymakers is whether the demand effects are so powerful that they have the potential to outpace the growth of aggregate supply in the short and medium perspective. Second, there could be temporary disinflation effects at work if the increase in productivity is unexpected initially.

If wages are slow to adjust, higher productivity growth lowers unit labour costs and thereby reduces price inflation. Here again there are important questions for policymakers. Should this effect be allowed to result in a temporary reduction of price inflation or unemployment? Third, an increase in the trend rate of productivity growth could also result in a higher equilibrium real interest rate, when the output gap is closed, in order to balance saving and investment. Fiscal policy and the development of public financial balances could at least partly offset this effect, as could the economy’s degree of openness. All this implies that monetary policymakers could face quite a few challenges. One of them is to identify structural changes and distinguish these from cyclical variations. Another challenge is to detect the magnitude of the effects. Furthermore, looking ahead in monetary policy is hard when the economy is going through major changes that make it difficult to forecast the future path of the economy and inflation. 5  BIS Review 65/2000  It is quite clear that this demands a great deal of forecasters as well as of those who construct macro models. The forecasts concern inflation one to two years ahead, which calls, for instance, for reasonable precision in the measurement of the output gap and the relationship between the output gap and inflation. It is already evident, for example, that inflation forecasts were frequently on the high side in many countries in the 1990s.
William C Dudley: Opportunities for economic growth in Puerto Rico Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, to representatives of Puerto Rico's business and academic communities, San Juan, Puerto Rico, 29 November 2016. * * * Jason Bram, Tony Davis, Andrew Haughwout and Joseph Tracy assisted in preparing these remarks. I am very pleased to be here and to have this opportunity to speak with representatives of Puerto Rico’s business and academic communities. In my remarks, I will discuss the lessons learned from municipalities in the United States that have faced crises over the years―such as New York City―and what those outcomes might imply for Puerto Rico as it seeks to restore and sustain economic growth. I will also touch briefly on the Puerto Rico Small Business Survey, a new survey from the New York Fed that focuses on the business performance, financing needs and borrowing experiences of firms across the Island. As always, what I have to say reflects my own views and not those of the Federal Open Market Committee or the Federal Reserve System. My meeting with you today is part of the New York Fed’s continuing efforts to understand what is going on at the grassroots level within our Federal Reserve district. We plan these trips so we can interact with a diverse group of stakeholders.

These meetings help me get a more complete picture of economic conditions on the Island and a fuller understanding of the major issues and concerns. This is the third time we have visited Puerto Rico in the past five years. Yesterday, I met with Governor-elect Rosselló to discuss the transition into his new role and the key challenges for his upcoming term. I also spent time with members of El Colaboratorio, a shared workspace organized by the Foundation for Puerto Rico. I attended a roundtable discussion with local businesses and spoke with former and current members of several of the New York Fed’s advisory councils. Earlier this morning, I met with the heads of a number of financial institutions and the University of Puerto Rico’s interim president, Celeste Freytes. Following this visit, I will meet with the leadership from Parallel18, an economic development initiative that attracts early-stage, highpotential startups to Puerto Rico. Finally, I will join the leadership of the Boys and Girls Clubs of Puerto Rico for a discussion on the organization’s initiatives and a site visit to one of the clubs to learn about workforce development programs and youth services. As we all know, the Commonwealth of Puerto Rico has been through a very rough 10 years. The economy has been in a long slump that could easily be called a depression. Residents have endured a terrible drought, periodic blackouts and a fiscal crisis. I don’t need to elaborate on all of the struggles Puerto Rico continues to face.