samchain/econo-pairs-v1 huggingface dataset:
Zeti Akhtar Aziz: The next wave for the financial system in Malaysia Keynote address by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the 12th Malaysian Banking Summit organised by ASLI "Taking the Leap in Paradigm Shift of Banking – New Wave, New Ventures", Kuala Lumpur, 5 June 2008. *  *  *  In this recent decade we have seen a period of profound modernisation of the Malaysian banking sector. Today, the banking sector has evolved from facilitating and supporting the economic growth process to becoming a significant source of growth. Innovation and product pioneering has proliferated the diversity of products and services offered. The adoption of best business practices, the use of new technologies, systematic cross selling and the new means of interface with consumers have become more pervasive. The banking system is also significantly stronger, reinforced by strengthened institutional structures, enhanced financial safety nets and developed financial markets, that includes one of the most developed bond markets in this region. Progressive deregulation and liberalisation have increased the flexibilities for banking institutions to capitalise on new business opportunities, both onshore and overseas. The strengthened incentives and more competitive environment have also prompted continuous performance improvements. Indeed, these developments have well positioned the banking sector to take the next leap forward. It is my pleasure to be here this morning to speak at this year's Malaysian Banking Summit which has focussed on the theme, the next wave for the banking system in Malaysia.

The Bank's preliminary assessment of the impact of the rationalisation of the domestic fuel and energy prices on inflation in 2008, is that it will rise to an average of 4.2% for the year. The initial price impact would be felt in June during which inflation is expected to be in the region of 5%. The increases in prices are expected to peak in the first quarter of 2009 before moderating to less than 3% in the fourth quarter. As international prices of commodities are expected to continue to remain high and as direct influence over these prices is limited, efforts will have to be focussed on increasing efficiency and productivity to reduce cost and to shift resources to areas of comparative advantage. From the perspective of monetary policy, the concern would be on the potential secondround impact of these price increases, the extent to which they lead to more generalised price increases and whether they pose a serious risk to inflationary expectations. It must be remembered that the current inflationary pressures is a global phenomenon, and that many of our trading partners and neighbours are having similar or higher inflation rates. Given this fact, the increase in inflation is unlikely to erode Malaysia's comparative advantages in global trade. The experience during current international financial turmoil have demonstrated fragilities in financial systems even among the developed economies.
In my view, this notion is nothing more than a financial analyst’s fantasy. In fact, over the last six months, we have seen constant confirmation of the anti-inflationary stance of monetary policy with, for example, the FED actually establishing a quantitative definition of price stability for the first time (in fact, identical to the one used by the Eurosystem). Sixth remark. Our immediate priority is therefore to construct or reconstruct the mechanisms and structures of a sound and efficient financial intermediation framework. That is why, at the euro area level, the financial union project is fundamental. At the global level, the FSB’s role is crucial in developing a robust technical, regulatory and prudential architecture, adapted to the interconnection of our economies. Seventh and last remark: fiscal policy and debt management. Here, I would say that we are all guilty of a certain degree of ambiguity, both at the market level and at the political level: •  on the one hand we want public debt markets that are broad, deep and liquid, because they form the base on which our entire financial system is built. In particular, government bonds are the safest and the most liquid assets. They act as reserves of value for a large number of investors, starting with the central banks themselves which hold them as foreign currency reserves or as monetary policy collateral. •  And on the other hand we want solvent States, i.e.

I believe that Europe has a major project ahead of it to recreate a broad, deep and liquid public debt market that is completely and unambiguously free from insolvency risk. 2  BIS central bankers’ speeches
This process has dragged the real economy and the fiscal position of many countries, thereby contributing to the further deterioration of the global picture of risks. This sort of negative feedback from financial factors can be explained both from the fundamental side, as global risks did increase while the ability to absorb losses decreased, but also from a behavioural perspective, since confidence disappeared as the evolution of the crisis pushed us to unchartered territories and away from the comfort zone in which we thought we were living. As central bankers, but also as risk managers, we fear that in some cases we may have gone too far, and that what we see now cannot be explained only in terms of a better understanding of risks, but in many cases reflects a sharp increase in risk aversion that it is not always fully justified by the “learning process”. It seems obvious that we need to incorporate in our decision-making process and in the models we use to support it, the notion that markets are driven by behavioural factors. All in all, one can optimistically conclude that this time some important lessons have been learned and hope that by implementing the necessary reforms, confidence can be restored. In any case, a crucial question remains: has the crisis changed our minds in a permanent manner or are we just living in a “crisis” mode and the lessons learned will be forgotten shortly after once the crisis is over?

We expect domestic demand developments to support the downtrend in inflation and the improvement in current account deficit in the months to come. To sum up, a co-analysis of domestic and foreign demand reveals that forecasts are based on an outlook in which the contribution of aggregate demand conditions to the end-2013 inflation has slightly increased compared to the previous reporting period. This revision drove the end-2013 inflation forecast up by 0.1 points. As you all know, food, energy and import prices also play a great role in inflation forecasts. Therefore, before moving on to forecasts, I will briefly talk about our assumptions regarding these variables. Import prices remained below the assumptions of the July Inflation Report in the third quarter. On the other hand, oil prices materialized slightly above the assumptions (Chart 20). In line with the average futures prices in the first three weeks of October, the average assumption for 2013, which was set as USD 107 in July, was revised upwards to USD 109. This revision added 0.1 percentage points to the end-2013 inflation forecast. We preserved our assumption for the annual rate of increase in food prices as 7 percent. In other words, it was assumed that the recent unfavorable course of unprocessed food prices would be temporary. Before moving on to forecasts, I will talk about our assumptions regarding public finance. Medium-term projections are based on the assumption that no additional tax adjustments will be introduced to tobacco and energy products the rest of the year.
BIS central bankers’ speeches  1  •  The non-financial corporate sector remains in generally healthy condition, with high profit margins and a high ratio of liquid assets to current liabilities. Of course, there are important risks to the growth outlook including: whether households behave cautiously relative to fundamentals given the experience of the Great Recession; the extent of the impact to the oil producing sector from lower oil prices, and the direction of the business cycle abroad. The FOMC’s view in its January statement was that the risks to U.S. growth are nearly balanced. There are also risks in both directions to the inflation outlook. Headline inflation has fallen quite low due to the drop in oil prices. These effects are likely to be transitory. Measures of underlying inflation such as the core PCE deflator have been running somewhat short of the FOMC’s 2 percent objective for some time. Moreover, market-based measures of mediumterm inflation compensation have fallen somewhat below the objective in recent months, even if survey measures of expectations have held essentially steady. There are also upside risks to inflation. The unemployment rate has declined and wage growth should firm as remaining slack diminishes. Moreover, the U.S. economy’s productivity performance has been relatively unimpressive in recent quarters. If continued, this could also begin to push inflation higher. It is in this context that the Committee has begun to consider the appropriate timing and pace for removing extraordinary accommodation.

Alberto G Musalem: US macroeconomic and regulatory developments and emerging market economies Remarks by Mr Alberto G Musalem, Executive Vice President of the Integrated Policy Analysis Group of the Federal Reserve Bank of New York, at the International Financial Conference Annual Meeting, Cartagena, Colombia, 9 March 2015. *  *  *  Thank you for the invitation to speak here today. It has been a pleasure to attend this conference, and to have the opportunity to exchange views with many of you. My remarks today will focus on the potential effects of the U.S. outlook and policy for emerging market economies. I will make three main points. •  The U.S. economy appears likely to make further progress toward the Federal Open Market Committee’s (FOMC) objectives of maximum sustainable employment and price stability. This actual and prospective improvement underlies market expectations that the FOMC will begin raising the Federal Funds rate sometime later this year. •  Emerging market economies (EMEs) have generally performed well during U.S. tightening cycles, especially when such policy shifts are supported by effective communication in the context of U.S. growth. •  There has been notable progress in improving the safety and soundness of the international and U.S. financial systems, to better support financial stability and economic growth. Before I turn to the specifics, let me remind you that what I say today reflects my own views, and not necessarily those of the Federal Reserve Bank of New York or the Federal Reserve System.
Andrew Bailey: Prudential regulation – challenges for the future Speech by Mr Andrew Bailey, Executive Director of the Bank of England, at the University of Edinburgh Business School, Edinburgh, 4 October 2012. *  *  *  It is a great pleasure to be in Edinburgh again and to have the opportunity to set out progress on the reform of financial regulation as we approach the formal introduction of the new arrangements. Scotland is home to a very important financial services industry for the UK and Europe and although it may at times seem like the changes taking place in regulation appear through London and Whitehall bubbles, they are clearly as relevant to you as they are to your counterparts in the City of London and Canary Wharf. All of us witnessed the costs associated with the failures of banks. We have learnt the lessons of that experience and that is why the reforms we are making to the way we regulate will affect us all and will create a system that is safer and stronger for every part of the UK. One thing I should emphasise is that this is a reform of the whole of financial regulation. I say that because it is easy to conclude from observation of the issues we face as regulators, and the public debate, that we are just dealing with reforming the regulation of banks.

That is not the case, and what we are doing is not about dragging the rest of the financial services industry into reform to solve a problem that is in essence only about the banks. We have to design a system that works effectively for all sectors of the industry. On that theme, I would like to start by reflecting for a few moments on the lessons of history. My main theme is that I think integrated regulation – by which I mean regulation which combines Prudential and Conduct of Business in one regulatory body with single teams of supervisors covering both – has not worked as effectively as it would need to do, for reasons that are deep-seated in the structure. I think there are a number of closely related reasons for this. First, on a rather practical point, I think it is hard for a single organisation to balance, particularly during a period of crisis, a wide range of very demanding issues which are individually rightly of great concern to the public and can come from anywhere in a landscape of around 25,000 authorised firms. Second, I think the evidence suggests that, over the last 15 years, there have been periods when either conduct or prudential supervision has been more in the ascendancy to the detriment of the other.
Among the main initiatives that emerged in complying with these recommendations, the following deserve mention (i) The updating of the 2007 document The Monetary Policy of the Central Bank of Chile, which presents the institutional and operational framework in which monetary policy is conducted, eliminating the “tolerance range” for the inflation target and introducing the “MPR corridor” as an instrument for communicating the 2 Art. 80, Law 18,840, LOC of the Central Bank of Chile. 3 The other members of the Panel were Donald Kohn, Senior Researcher at the Brookings Institution, Member of the Bank of England’s  Financial Stability Committee and Former Vice Governor of the US Federal Reserve; Petra Geraats, Professor at Cambridge University and Expert Advisor on Transparency and Communication of Monetary Policy; Guillermo Calvo, Professor at Columbia University and Former Chief Economist of the IADB; and Enrique Mendoza, Professor at the University of Pennsylvania and Former Researcher at the IMF. 4 The report can be found at https://www.bcentral.cl/web/banco-central/evaluaci%C3 %B3n-externa. 5 The two proposals dismissed were: (i) the recommendation to make the inflation target policy horizon more flexible, because the twoyear period occupies an important place in the monetary policy framework, and modifying it can bring more costs than benefits, and (ii) changing the organizational chart considered with respect to the Financial Policy Division Director, because it was considered that the current organizational chart already recognizes the specific functions of the position.

21  Table 1: Fiscal and monetary policies to increase commercial credit (*) Country  Fiscal  % GDP  Monetary  % GPD  United States  Forgivable loans to small and medium enterprises (SME)  3.4  Bank credit (TALF, MSLP) and purchase of corporate bonds (PMCCF - SMCCF)  7.3  Germany  Loans with federal and state guarantees  25.3  France  Loans with guarantees, includes reinsurance value  15.2  Secured loans, part of the amount estimated by the IMF  --  Italy  33.8  TLTRO loans from the ECB. Long-term refinancing to the banking sector (up to 3 years) conditional on non-financial corporate loans  Spain  Guaranteed loans, excludes facilities for lowincome households  9.6  UK  Guaranteed loans  16.8  TFSME loans.
At their summit in June, EU Member States entered into a political commitment, and the European Commission is now proposing to create a single supervisory mechanism for banks in the euro area and to entrust this task to the ECB. This single supervisory mechanism should be implemented in a way that does not compromise the ECB’s independence and does not constrain monetary policy. It should be complemented by a single regime to wind down failed banks and by a single resolution fund at euro area level. Finally, building a deeper EMU requires a strengthening of democratic legitimacy and accountability. The people of Europe will only accept a further pooling of competences at European level if European policy-makers are subject to high standards of accountability. 6  BIS central bankers’ speeches  The European Parliament, whose representatives are directly elected by citizens, already plays a central role in holding the ECB and other EU institutions to account. As a consequence of deeper economic and political integration in EMU, the euro area will become, in my view, more and more a “political space” in its own right and, as such, it will require proper euro area accountability mechanisms. Political legitimacy is vital to build popular support for further integration. 4. Conclusion  Ladies and Gentlemen, When Robert Schuman drafted the declaration that started the European integration process, he predicted that “Europe will not be made all at once, or according to a single plan. It will be built through concrete achievements which first create a de facto solidarity”.

It is gratifying to note that applications were invited from all eligible students in various higher institutions of learning around the country. I have also been informed that although only four teams have been shortlisted, the response from the young entrepreneurs was overwhelming with about 75 total applications received. I am certain that the winning team will be worthy winners of the K100 Million Business Loan Sponsorship prize. Further, I have been reliably informed that the competition will become an annual event and prize money will be increased in future years, which indeed is commendable. I am certain that the award will provide a great incentive to our young men and women to be innovative and develop business ideas. The initiative will also improve the level of entrepreneurship in the country which is lacking at the moment. Mr Chairman I once again applaud you and your co-sponsors for this long term commitment to this award programme. Distinguished Ladies and Gentlemen, allow me at this moment to highlight the importance of entrepreneurship in our economy. Entrepreneurship involves developing innovative ideas, taking risk and managing the business in a sound manner. In these turbulent times and with an increasingly competitive global market, it is vital for a country like ours to have a good entrepreneurial base which should contribute to wealth creation and to the country’s economic development. The need for more Zambians to own successful businesses and compliment foreign investments in our country cannot be over-emphasised.
While Puerto Rico has a number of features that make it a potentially  2  The debt figures reported for the U.S. mainland states refer to debt held by the public and exclude debt held by government agencies. Most Puerto Rico debt is held by the public. 4  BIS central bankers’ speeches  strong economy, economic growth on the Island has been weak for almost a decade. To restore growth and raise living standards, it is critically important for policymakers to expand efforts to marshal the Island’s considerable strengths – a bilingual and well-educated adult population, an open economy occupying a central position in the Caribbean, a wide experience as a host to multinational corporations, and close ties to the U.S. mainland economy. While the challenges to restoring growth are clearly complex, I want to highlight some key areas where policies to support efficiency and growth might be strengthened. First, barriers to job creation and active participation in the labor market should be reduced. The current structure of labor market incentives could be examined to ensure that firms do not face significant hurdles in creating jobs and workers are not discouraged from entering the labor force. Second, policymakers should continue their efforts to create a more dynamic business environment, including the elimination of unnecessary costs of setting up and operating a business, particularly with respect to energy costs. Third, economic development efforts should consider a more proactive approach to utilizing the Island’s educated workforce and well-established higher education system.

An independent regulator for utilities is the norm throughout mainland states. By leveraging the expertise and reputation of existing independent regulatory agencies, Puerto Rico may improve the efficiency of its public corporations while reassuring investors. As a fifth step, the Commonwealth could benefit from adopting fiscal institutions more like mainland states. Balanced budget rules are far from perfect, but by following the states’ model – splitting the budget into an operating piece that must be balanced and a capital piece that can be financed with debt – Puerto Rico could better align financing methods with its spending priorities. A sixth step is for the Commonwealth to implement a framework to help ensure that budget targets are met. A key aspect of such a framework would require that the authorities implement multi-year budgeting, in which revenue and expenditure plans are articulated over a three to five year horizon. Such a framework should also incorporate a review of the central government’s macroeconomic and fiscal forecasts by a non-partisan independent entity, the views and analysis of which could be published in coordination with the Commonwealth’s proposed budget for any given fiscal year. New York City, for instance, uses this type of framework. The steps should be viewed as potential ways to improve Puerto Rico’s finances over time and I present them to you for consideration and discussion. The decisions are obviously up to you. Other countries, U.S. mainland states and municipalities facing similar fiscal issues have been able to overcome them.