samchain/econo-pairs-v1 huggingface dataset:
This is because either the desired policy rate is sufficiently below the ELB or the central bank has committed to keep 3/5  BIS central bankers' speeches  interest rates unchanged through forward guidance. However, conflicts of objectives between fiscal and monetary policies may arise in the future. The ongoing accumulation of public debt and the large expansion of central banks’ balance sheets increase the likelihood of such conflicts. On the one hand, large fiscal stimuli for too long may lead to concerns about debt sustainability and, via the expectation of future fiscal tightening, offsetting the favorable effects on output and inflation. On the other hand, central banks should keep the risks taken in their balance sheets under control to avoid threatening their own independence. Indeed, low inflation today is not a guarantee that it will remain low forever. They must keep a sound balance sheet with adequate capital in order to keep full control of their monetary stance all along the road. The key question is then how to reconcile the benefits of a mutual reinforcement of monetary policy and fiscal policy in the short-term with the challenges of keeping inflation under control and public debt to sustainable levels in the long-term. There is no magic answer to this question but I will try to sketch here some basic principles that are in my opinion ingredients of a sound policymix recipe: 1. Each authority should be guided by and stick to its mandate.

In March, the annual broad money expansion was supported by increased private sector credit, which rebounded in line with its seasonal trend path. The upward contribution of private sector’s demand for money has offset the gradual decline in net foreign assets. Public sector’s demand for money has been upward, supportive to the government’s more active stance over the first quarter of the year. In annual terms, the private sector loan portfolio grew by 11.5% from 10.3% in February. Business loan remains the main contributor to expanding the private sector lending. In the meantime, in March, household loans also showed positive signs. Overall, financial markets performed positively during the first four months of 2011. The information transmitted from financial markets shows agents’ anchored inflation expectations. Key interest rate rise at end-March is passed-through to short-term money market interest rates, leading to a slight flattening of T-bill yield slope. In deposit market, interest rates continued to fall, reflecting also the correction of their high rates having been marked after 2008. The foreign exchange market has operated smoothly and the exchange rate has continued to depreciate at low annual paces. The Bank of Albania has supplied the interbank market with the necessary liquidity for their normal functioning. To sum up, the Bank of Albania judges that the relatively high inflationary pressures over the first quarter of the year generally resemble transitory shocks.
Michael Gondwe: Facilitating trade and building economies on the African continent Opening remarks by Dr Michael Gondwe, Governor of the Bank of Zambia, at the African Trade Insurance Agency Workshop for Bankers, Lusaka, 10 September 2013. *  *  *  The Secretary General of COMESA, H.E Sindiso Ngwenya; The Director General of Zambia Development Agency, Mr Andrew Chipwende; The ATI Chief Investor Relations Manager, Mr Cyprien Sakubu; The Representative for Zambia, Mr Pizzaro Lukhanda; Resource Persons; Distinguished Invited Guests; Members of the Press; Ladies and Gentlemen. It is my honour and privilege to be amongst you all this morning. I wish to express my appreciation to the African Trade Insurance Agency for extending an invitation to me to deliver a keynote address on this important Workshop. Let me begin by commending the African Trade and Insurance Agency (ATI) for the important role they continue to play in facilitating trade not only in this Country but in the entire Region and indeed the Continent at large. I am no stranger to the role that ATI plays in helping to build economies in the countries that it operates as I have been a client and a supporter of ATI’s products and services in particular in my previous life as Head of the PTA Bank. I have seen first-hand, the impact that ATI has had in many countries, including in Zambia, where ATI has facilitated trade and investments worth more than $ million since its inception.

The NGFS has acted quickly in looking into nature-related risks, well ahead of the financial industry. We collaborated with INSPIRE2, an independent research network, to produce reports setting out the importance of biodiversity for the macroeconomic and financial systems. These reports also made preliminary recommendations on how central banks and supervisors might align themselves with the structural transformations required to deliver a nature positive global economy. The NGFS, in the next phase of its work, will aim to equip central banks and supervisors with a common base of knowledge of nature-related risks. We will provide recommendations on how nature-related risks can be integrated into the other work programmes of the NGFS, including supervision, scenario analysis, and monetary policy. We will make nature-related risks more tractable, by focusing on nature-related risks with a nexus to financial risks. We will identify a few local case studies to work through concrete examples where the link from ecosystem degradation to climate change is clear, such as in deforestation. Finally, CAPACITY BUILDING AND TRAINING. The NGFS will provide guidance on how central banks and supervisors can build up their capabilities in climate-related and environmental risks. The importance of building capacity and expertise on climate issues within the central banking and regulatory community has been consistently espoused by the NGFS since its beginning. Our members are at different stages of progress in their ability to address climate-related and environmental risks. We want to make sure they have the support they need to make meaningful progress in addressing these risks.
And given the interconnected nature of these markets, this is not a purely domestic challenge: UK borrowers are exposed to any deterioration in global risk appetite. One potential trigger for loss of investor appetite is so called ‘fallen angels’ – companies whose credit has been downgraded to sub-investment grade. This is a vulnerability the FPC keeps an eye on, as it could have amplifying effects – with forced selling and many investors scrambling to sell assets at the same time, either because investment mandates prevent them from holding such bonds, or to avoid higher capital requirements associated with riskier debt. There are various international and domestic efforts underway to improve our understanding of market based finance and to make it more resilient to stresses. The Bank, for example, is currently working on a system-wide exploratory scenario to consider bank and non-bank behaviour in a severe but plausible market stress, as well as the potential consequences of their actions. Corporate debt and sustainable growth I’ve talked about why the FPC cares about the supply of finance to corporates under its primary objective for financial stability. But in addition, and subject to meeting that objective, we also have a secondary objective to support the Government’s economic policy – sustainable economic growth. [4] Of course financial stability is a prerequisite for sustainable growth, so pursuing our primary  Page 9  objective helps us meet our secondary one. But the secondary objective broadens our interests in corporate finance.

This positive outlook needs to be underpinned by responsible fiscal policy-making and by social partners reacting appropriately to the increase in oil prices. It is crucial that any loosening in fiscal policy be avoided. Similarly, continued wage moderation is important in order both to contribute to further decreases in the level of unemployment and to maintain a favourable outlook for price stability. It will be equally important for structural reform to be intensified further in order to allow current high growth rates of real GDP and employment to be sustained into 2001 and beyond, without generating inflationary pressure. Let me now give the floor to the Vice-President to inform you about two further issues decided by the Governing Council today. I should like to inform you that, in the course of next week, the ECB will release an update of the so-called Balance of Payments Book. This annual publication documents the statistical methodologies applied in EU Member States for the compilation of balance of payments statistics and, as such, improves the transparency of the compilation of euro area statistics. In addition to updated individual country chapters, this version includes two new chapters on the compilation and methodological standards for the euro area balance of payments and international investment position. The Book will be published on the ECB’s website and hard copies will be available at the ECB.
How innovative is an ECB allowed to be, which as a start-up from the year 1999 is in many ways itself an innovation, and as a custodian of a currency without a state can only partly be compared with other central banks. Of course I can only give you today, less than a week before our ECB Governing Council meeting, some general reflections from my personal point of view. I think we can all readily agree that innovation cannot be an end in itself. The ECB must and will act only in accordance with its mandate. Price stability is the guiding principle of our actions. The definition of our mandate does not allow for innovations. Moreover, in uncertain times of crisis a clear focus is not less, but doubly important. Central banks therefore have a particularly strong understanding of tradition, and for a good reason: monetary policy is all about trust, reliability and consistency. Innovative measures must therefore be judged against our mandate of maintaining and creating price stability. As with any decision, innovation demands a sober analysis of the costs and benefits, the opportunities and risks. Allow me to slip briefly into legalese: innovative monetary policy measures, too, should be suitable to achieve their objective. Since monetary policy measures also have side effects, a central bank should use the mildest means to achieve the fewest possible side effects. Low inflation rates and the catalogue of measures So what does this mean for the current situation? Unanimous monetary policy can and must maintain price stability.

At the Federal Reserve, experience has shown that supervising large, complex banks calls for supervisors with a high level of technical expertise, the intellectual ability to make difficult specific judgments based on general principles, and the strength of character to remain open-minded but steadfast in the face of pressure from the management of supervised institutions. The accounting industry needs to be certain it is attracting people with these same attributes. As to accounting rules, one of the major issues today concerns executive stock options, as I have noted. Grants of stock options and the exercise of these grants are, as we know, disclosed in the footnotes of a firm's reports, but this information typically is not accounted for in the firm's income statement or balance sheet. Some might argue that, as long as the information on stock options is disclosed, exactly how the information is accounted for is unimportant since disclosure in and of itself is sufficient. In theory, this view may be justified. In practice, however, what we have found is that information that is disclosed but remains off the accounting statements is unlikely to be fully incorporated into the price of the stock. Another major issue with respect to accounting rules - and there is some overlap with disclosure issues here - concerns how intangible assets and complex financial transactions are treated. Intangible assets are generally thought to include a valuable trademark, a renowned reputation, or an efficient process in delivering goods or services.
Simply ask the following question: If r* were close to its long-run historical value of 2 percent, would we expect to see the economy growing at only slightly above its potential growth rate? The fact that the economy is growing quite slowly despite a low federal funds rate and a very large Federal Reserve balance sheet suggests that monetary policy currently is not providing that much stimulus to the economy. In other words, the gap between r* and the federal funds rate is relatively narrow. Why is r* depressed and how is it likely to evolve over time? In my view, several short-term factors are restraining r*. First, the short-run r* is low because the foreign exchange value of the dollar has risen, reflecting both the fact that foreign economies are growing slowly and as well as an expectation that the monetary policies of the U.S. and other major economies will continue to diverge for some time. If foreign demand picks up and the dollar weakens, then r* would likely rise over time as the persistent drag from the trade sector lessens. Second, short-run r* is low because of the hangover of the financial crisis. For example, mortgage credit availability for households with low FICO scores is still very limited compared to pre-housing boom standards. This is constraining their ability to purchase housing, which holds back the pace of residential investment.

In particular, potential real GDP growth in the U.S. appears to have declined in recent years – held down by slower productivity growth and demographic factors that are causing the workforce to grow more slowly. This is the main reason why I have cut my estimate of the longer-run federal funds rate in recent years. And I’m not alone. In the FOMC’s September Summary of Economic Projections, the median projection for the long-run federal funds rate was 3 ½ percent, 50 basis points below the level of two years earlier. My discussion about short-run r* and long-run r* has implications for how I think about monetary policy. The likelihood that we face a situation where the short-run r* is depressed, the economy is growing only slightly at an above-trend pace and inflation is too low relative to our objectives, suggests that we need to think carefully whether the time is right to begin to normalize monetary policy. Additionally, the likelihood that long-run r* is lower than it has been historically, suggests that after lift-off the upward trajectory of the short-term rates is likely to be quite shallow. Another factor that weighs on the timing and pace of normalization is risk management. What are the relative costs of going too early versus too late? As I see it, there are risks on both sides, and I think this explains why reasonable people can differ as to the appropriate path for the policy rate. Consider the two main risks of normalizing too quickly.
21  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  21  Chart 18: Distribution of firm level labour productivity across regions in 2013/4 Density 0.025  0.02  North East  North West  Yorkshire & Humberside  East Midlands  West Midlands  East of England  London  South East  South West  Wales  Scotland  0.015  0.01  0.005  0 -50  0  50  100  150  200  GVA per employee, £ Source: ONS; Bank calculations. Please see footnote under Chart 19. Chart 19: Distribution of firm level labour productivity across industries in 2013/4 Manufacturing  Density  Construction  0.025  Wholesale and retail trade Transportation and storage  0.02  Information and communication Professional, scientific and technical activities  0.015  0.01  0.005  0 -40  -20  0  20  40  60  80  100  120  140  160  GVA per employee, £  Source: ONS; Bank calculations. Notes: This chart plots the kernel density distribution of labour productivity (real GVA per employee) across Great Britain. This work contains statistical data from ONS which is Crown Copyright. The use of the ONS statistical data in this work does not imply the endorsement of the ONS in relation to the interpretation or analysis of the statistical data. This work uses research datasets which may not exactly reproduce National Statistics aggregates.

Our reorganization strategy focuses on four aspects, namely organizational structure and work process, human resource management, decision-making process, and database and information technology. Our hierarchical structure has now been reduced from a total of seven layers to four. Authorities and responsibilities are being further delegated toward a lower level to the operating officers in charge. This helps reduce the previously lengthy approval process and increase our flexibility. New departments have been established to better cope with the rapidly changing economy and the rising information need of the organization. These include the Data Management Group, the Information and Public Relation Group, the Planning Group who conducts a bank-wide risk assessment as well as a new Department of Risk Management and Information Technology Examination, who monitor risk profile and risk management at the financial institutions. In addition, our business processes are now more client-oriented with a new website, new voice-mail, and new central point of contacts being offered as services to our stakeholders. Both the Netherlands and Thailand are small open economies in the world market. To survive the tide of globalization, we both need a well thought out strategies. We have to choose our battleground and cooperate with friends around the world. To do this, local strength has to be further strengthened while lessons and technologies must be learnt from others. Here, international co-operations through jointed ventures, through foreign direct investment, or through international trade will play major roles in our successes.
And those risks will grow, unless we put global banks and markets on a sounder footing. Suppose, for example, that UK-owned banks’ share of global banking activity remains the same and that financial deepening in foreign economies increases in line with historical norms. By 2050, UK banks’ assets could exceed nine times GDP, and that is to say nothing of the potentially rapid growth of foreign banking and shadow banking based in London. Some would react to this prospect with horror. They would prefer that the UK financial services industry be slimmed down if not shut down. In the aftermath of the crisis, such sentiments have gone largely unchallenged. But, if organised properly, a vibrant financial sector brings substantial benefits. Today financial services account for a tenth of UK GDP and are the source of over 1 million jobs.5 Two thirds of those are outside London, including jobs in asset management in Edinburgh, transaction processing in Bournemouth and insurance in Norwich. Being at the heart of the global financial system also broadens the investment opportunities for the institutions that look after British savings, and reinforces the ability of UK manufacturing and creative industries to compete globally. Not to mention that financial services represent one of the UK’s largest exports. More broadly, London’s markets serve a vital global role. London acts as Europe’s window to global capital; is a centre of emerging market finance; and can play an important role in the financial opening of China.

The last step in this process will be made with the cash changeover at the end of this year; it will enable not only enterprises but all our citizens to enjoy all the advantages of using the same monetary instrument throughout the European continent, just like Americans do today throughout the territory of the United States. b/ Moreover, the introduction of the euro brings about a significant change in the economic and financial environment. 4  BIS Review 28/2001  The introduction of the euro has been a strong catalyst for mergers and acquisitions in the euro area. The European M & A market seems to be amongst the most dynamic in the world: with operations totalling over 900 billion euros in 2000, it is now catching up on the American market. The euro has brought about significant changes for participants in financial markets and has fostered structural developments in the financial industry. This is true both on euro-area money markets and on capital markets. –  From the beginning of Stage Three of EMU, cross-border transactions in the money market increased so as to represent more than 50% of the total activity in all segments of the money market. The unsecured deposit interbank market - which is mostly concentrated on shorter maturities - exhibits a very high degree of integration. The integration of interest-rate markets within the euro area is a key achievement which deserves to be underscored. EONIA and EURIBOR have provided the market with uniform benchmarks fully accepted by all market participants.
Christian Noyer: Monetary policy and macroprudential policy Speech by Mr Christian Noyer, Governor of the Bank of France and Chairman of the Board of Directors of the Bank for International Settlements, at the conference on “The future of Monetary Policy”, Rome, 1 October 2010. *  *  *  Ladies and Gentlemen, It is a great pleasure for me to be here today at this joint Banca d’Italia, Einaudi Institute and Banque de France conference, which has provided a lot of stimulating ideas on the future of monetary policy frameworks. In my intervention, I will start with some reflections on the relationship between the objectives of price stability and financial stability, and I will then proceed to discuss several issues concerning the joint implementation of, and the interaction between, monetary and macroprudential policies. I. General considerations on the relationship between financial stability and price stability  Both the experience of the last decades and, looking much further back, economic history provides a useful perspective on the relationship between price and financial stability: first, price stability is not a sufficient condition for financial stability but second is necessary; third, a key reason why the authorities in charge of monetary policy have a stake in maintaining financial stability is that financial instability may give rise to “tail risks” to price stability. Let me elaborate on these two issues in turn. A.

Combining multiple objectives into a single one, on the other hand, would only apparently solve the problem by artificially reducing the number of goals, but it would not change the fundamental nature of the control problem facing the policymaker. At the current juncture, only very little research is conducted on the interaction between monetary and macroprudential policies within rigorously microfounded general equilibrium models. The Banque de France staff and I are very admirative of the leadership of Banca  7  See Claudio Borio and Haibin Zhu (2008), “Capital Regulation, Risk-Taking, and Monetary Policy: A Missing Link in the Transmission Mechanism?”, BIS Working Paper n. 268, December 2008. 8  See Yener Altunbas, Leonardo Gambacorta, and David Marqués-Ibáñez (2010), “Does Monetary Policy Affect Bank Risk-Taking?”, ECB Working Paper n. 1166, March 2010. 9  See Vasso Ioannidou, Steven Ongena, and José-Luis Peydró (2008), “Monetary Policy, Risk-Taking and Pricing: Evidence from a Quasi-Natural Experiment”, ECB, mimeo; Matteo Ciccarelli, Angela Maddaloni, and José-Luis Peydró (2009), “Trusting the Bankers: Another Look at the Credit Channel of Monetary Policy”, ECB, mimeo. 10  See Benoit Mojon, Simon Dubecq and Xavier Ragot (2010), “Fuzzy Capital Requirements, Risk Shifting and the Risk Taking Channel of Monetary Policy”, Banque de France mimeo. 11  See Raguram Rajan (2005), “Has Financial Development Made the World Riskier?”, presented at: The Greenspan Era: Lessons for the Future, a symposium sponsored by the Federal Reserve Bank of Kansas City, Jackson Hole, Wyoming, August 25 – 27, 2005.