samchain/econo-pairs-v1 huggingface dataset:
Bandid Nijathaworn: Global markets outlook Opening speech by Mr Bandid Nijathaworn, Deputy Governor of the Bank of Thailand, at the Global Markets Outlook Conference Series 2007, organised by Deutsche Bank, Bangkok, 8 January 2007. *  *  *  Thank you very much and good morning, First, let me thank Deutsche Bank for inviting me to give the opening remark this morning. Last year, I was also honoured with the same opportunity, so I am very pleased to be back doing this again this year, addressing this important conference. A lot of things have happened to both the global markets and to Thailand since the time we met last year. And compared to last year, to be speaking on the economy and the markets this year, I think, is much more challenging. At this time, although the mood in the markets is positive, I think considerable uncertainty still looms in the global economy to the extent that even the best of our analysts still do not seem to be coming to a common view on the key issues. For example, the pace of global slowdown and how much further would the US dollar need to adjust. But, this is, in essence, the nature of markets, and a variety of views will provide the markets with the needed latitude and balance for its continued growth and stability. So, I very much look forward to today's conference, and to the presentation on some of these issues, as well as on this year's outlook.

This means liquidity should continue to be ample as monetary policy in the major economies need to focus less on inflation. Ample global liquidity, therefore, will be a positive factor for financial markets this year. Second, structurally, the US dollar may need to stay with its softening tone on account of the moderated US growth and the possible narrowing of interest rate differentials that used to benefit the US dollar. This is a conjecture consistent with the current market's fundamental view. And third, because of ample liquidity, cross-border capital flows look to gain further momentum this year as international investors continue to search for yield and move further ahead on asset reallocation and diversification. This last implication is important for the region, because it will mean continued flows of capital into Asia, putting pressure on the region's exchange rates and asset prices. Therefore, managing the macro implications of persistent capital inflows, as well as the risk of volatile and abrupt capital outflows, will be, in my view, an important policy challenge this year. To me, the context underlying these implications relates very closely to the process of the unwinding of global imbalance. Such unwinding, as we know, requires a weaker path of the US dollar and higher US interest rates. A weaker US dollar is something that we have been seeing.
Jessica Chew Cheng Lian: The insurance broking sector – threshold of an exciting but challenging future? Keynote address by Ms Jessica Chew Cheng Lian, Assistant Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the 3rd Asia Insurance Brokers’ Summit, Kuala Lumpur, 3 March 2015. *  *  *  It is my great pleasure to be a part of this 3rd Asia Insurance Brokers’ Summit which is being held for the first time in Malaysia. I would also like to take this opportunity to congratulate MITBA as they celebrate 40 years in service of insurance and takaful brokers in Malaysia. In that time, the domestic insurance industry has seen significant change – beginning with an overhaul of the legal and regulatory framework when the industry was brought under the regulatory oversight of Bank Negara Malaysia, followed by a series of successive reforms that have served to strengthen the industry and promote its healthy development to first and foremost meet the needs of individuals and businesses. This continues to be a journey that the Bank and industry are committed to taking forward, mindful that as the Malaysian economy is progressively transformed, so too will demands of the industry evolve. Throughout this journey, associations like MITBA have played an important role in helping members adjust to the changing environment, by providing a platform to examine issues, make representations, communicate with stakeholders, and implement collective responses.

I expect GDP growth to be around 2-1/4 percent this year, moderately above my estimate of the long-run sustainable growth rate for the economy. In my past speeches, I often mentioned the fact that we’re nearing the longest expansion on record. Well, as of this month, I can finally say that we’ve reached that milestone. The economy has been growing for 121 months—a little over 10 years. 1/3  BIS central bankers' speeches  While this is undoubtedly good news, the headline data mask a more nuanced economic picture. Consumer spending has been an important driver of growth, and the most recent readings have been very positive. However, other signs point to slowing growth. In particular, the latest indicators suggest that business fixed investment has softened and that manufacturing production is in decline. And the outlook for growth outside the United States has dimmed, which will weigh on demand for U.S. products. This mixed picture is mirrored in the employment data. On one hand, the unemployment rate, which stands at 3.7 percent, is near the lowest we’ve seen in 50 years. On the other, job growth has slowed this year relative to last year’s pace. Finally, turning to prices, the latest data show that underlying inflation is 1.6 percent, below our 2 percent goal. The major challenge with inflation that’s persistently lower than 2 percent is that low inflation feeds into inflation expectations.
Chart 6: BBB-rated corporate bonds as a proportion of investment-grade corporate bonds in UK insurers’ Matching Adjustment portfolios  Sources: Solvency II Q3 2018 asset data, Bank calculations, Bank of England. 12  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  12  Chart 7: England and Wales house price changes 2007 vs 2015  Source: house.brisket.com, using Land Registry, Ordnance Survey and Royal Mail data. 13  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  13  Chart 8: England, Scotland and Wales projected flood risk for mortgage lenders  Note: This map shows how ten-year average losses from flood vary across local authority districts in Great Britain. Ten-year average losses are expressed in terms of outstanding mortgage lending. Source: ClimateWise, Sayers and Partners and Vivid Economics, based on FFE  14  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  14

The Bank has been conducting an industry-wide benchmarking exercise since 2001, in line with recommendations of the Financial Sector Master Plan to drive performance improvement. I believe the industry has benefitted from this initiative to improve the standard of services provided to its customers. Going forward however, it is timely and economically sensible for the industry to collaborate and assume this role to develop its own range of indicators. If we were to strive for quality, the benchmarking should be against the world’s best, and not confined to our domestic market alone. The benchmarking could cover a wider range of indicators including financial and operating statistics, distribution channels as well as customer service indices that will benefit every member company. In many countries, it is the industry associations that undertake this role. In this regard, I call upon the associations present here tonight to give this matter a serious thought. Collaborate and cooperate with others as synergy drives efficiency for the ultimate benefit of customers Synergy creates new value and has a multiplier effect on outcomes that would not be possible, individually. Studies have shown that even the best individual efforts cannot stack  4  BIS central bankers’ speeches  up against today’s complex and interconnected problems. The challenges of market liberalisation will require players to achieve more despite limitations in individual resources. But having to do more with less, simply means having to do it together. The industry through pooling of capacity, expertise and resources can addressed, perennial issues faced by individual companies, collectively.
Accordingly, trade in machinery, metals and textiles were particularly hard hit during the crisis. 14 Meanwhile, demand for non-durable consumer goods – and this includes pharmaceutical products – remained relatively stable. As you can imagine, there were probably very few patients who restricted their medical treatment due to the recession. As a result,  14  However, it was precisely these industries which had, in the preceding years, already become considerably less significant for Switzerland’s goods exports. BIS Review 157/2010  5  Switzerland’s large share in exports of pharmaceuticals had a stabilising effect and helped avoid an even greater drop in Swiss goods exports. Ladies and gentlemen, in addition to the diversification towards Asia, the longer term structural change in the composition of Swiss goods exports thus also proved beneficial during the crisis. 2.3  Quality matters  The third aspect I wish to address today is the quality of Swiss goods exports. As a rule, the “Made in Switzerland” hallmark is used to denote excellence. But do Swiss exports actually deliver high quality? Quality is not easily measured. Given the lack of alternatives, economists generally express the quality of goods in terms of “unit values”. Literally speaking, this represents the average price per unit of weight, for instance per kilogram. I, too, will use this unit of measure. However, this unit makes more sense if groups of similar products are examined.

Nevertheless, in the case of the large international banks, the empirical evidence would seem to suggest that these institutions have long exceeded the size needed to make full use of these advantages. It should be noted that although the instrument of size restriction is far-reaching, it is by no means new in economic policy. For decades it has been one of the tools for preventing market dominance in the area of competition policy. Within the context of financial stability, the objective of such a measure would be to reduce risks to the stability of the banking and financial system, rather than to maintain competition. I would like to run through the last few points again briefly. In the short term, priority must be given to overcoming the crisis. However, in order to increase the stability of the financial system in the medium to long term, we consider a reform of the operational environment in the banking sector to be essential. We attach particular importance to alleviating the “too big to fail” problem. Apart from stricter rules for systemically important institutions, the SNB currently envisages two further options that it intends to examine – first, measures to facilitate the wind-down of large, international institutions and, second, direct and indirect measures to limit their size. The SNB will examine all of these in depth, in close collaboration with FINMA, alongside possible further options. There can be no more taboos, given our experiences of the last two years.
It is an idea that the ECB fully supports. The development of the market for simple and transparent Asset Backed Securities deserves particular support. Member States should consider the provision of public guarantees to support lending to small and medium sized enterprises. There also needs to be a consistent and credible application of the Stability and Growth Pact across time and across countries. Within the existing framework, countries should explore how to support productive investment. In monetary policy, we have deployed a number of non-standard tools to ensure our very accommodative monetary policy stance is transmitted to the real economy. Last week, the Governing Council decided to start the purchase of certain high-quality asset-backed securities and covered bonds in October. Senior tranches of such ABS have proven to be high quality assets. Alongside our Targeted Longer Term Refinancing Operations, we expect these measures will enhance the functioning of monetary policy transmission, provide further accommodation now that we are at the lower bound, and have a sizeable impact on our balance sheet. *** Ladies and gentlemen, It is a pleasure to be here tonight with you in Milan. In a recent speech in Jackson Hole, I spoke about the need for a policy mix involving monetary, fiscal and structural policies to jump-start the economic recovery in the euro area. We are currently facing a set of conditions – low growth and low inflation, high debt and high unemployment – that can only be addressed by concerted action on both the demand and supply sides of the economy.

Our efforts should therefore be focused on jump-starting investment. However, and this was really the crux of my argument, we will only manage to stimulate investment if structural, fiscal and monetary policies mutually reinforce each other. 4  BIS central bankers’ speeches
Although the time profile of the adjustment process is different, as is the degree of short-term pain involved, internal adjustment arguably leaves the economy leaner and fitter than it would if everyone could simply depend on depreciation to see them right. The second flawed perception was that the intervention by the authorities in the stock market in August 1998 represented a fundamental reversal of traditional non-interventionist policy. The mistake here was to fall into the trap of characterising Hong Kong as a place where the authorities never intervened. We have always made clear our preparedness to intervene for such purposes as promoting efficiency in the market economy, providing infrastructure, or providing necessary support for the most needy in society. But our emphasis has always been to keep intervention to the minimum. This may sound uncontroversial today; indeed, it is probably an attitude shared by most governments, including those here in Europe. But you should remember that when Hong Kong was first vigorously espousing this doctrine, perhaps 30 or 40 years ago, the vogue in most western countries was for the  1  BIS Review 23/2000  state to assume an expanding role in the economy. In keeping with Hong Kong’s principles, the stock market intervention in 1998 was specifically directed towards improving the operation of the market economy rather than perverting it: it was designed to frustrate market manipulation that would otherwise have led to serious market dislocation.

Our ambition will then be to make it clear that we have done so. By raising and lowering the steering interest rate - the repo rate - the Riksbank attempts to influence inflation. As it is so difficult to steer inflation in the short term, the Riksbank makes an assessment of developments for the coming 1-2 years. This is the period of time usually assumed necessary for an interest rate adjustment to work its way through the economy and have a full impact on the rate of price increase, i.e. inflation. The Riksbank uses a simple rule-of-thumb when shaping its monetary policy. If the total picture of inflation shows that it is expected to be above or below the target level, the steering interest rate is adjusted accordingly. There are four main factors in the analysis of future inflation that stand out as central to the shaping of monetary policy: the development of total resource utilisation, international price trends, the exchange rate and the general public’s inflation expectations. Inflationary pressure varies according to the demand situation and to changes in resource utilisation. The stronger the upturn in demand in relation to potential production, the greater the risk that prices and wages will rise rapidly and vice versa. This is why we who work in central banks around the world  BIS Review 12/2003  1  must analyse the picture of economic activity as a whole, despite the fact that inflation is our target variable.
The situation is similar in substance in Europe, where new regulatory directives and regulations account so far for 2,000 pages of primary legislation, and where detailed rule-making occur on a similar scale as in the US, we would end up with 60,000 pages for a now literal regulatory blanket. Today’s financial markets are very complex and are becoming even more so. Haldane and Madouros are right: “as you do not fight fire with fire, so you  4  BIS central bankers’ speeches  don’t fight complexity with complexity”. An efficient regulatory response should be grounded in simplicity. The “keep it simple” principle has never sounded truer. III.2. Fixing the financial system  Attempts to fix the financial system seek to alter its structure by dealing with the scope, the size and the cross-border dimension of the financial activity. As concerns the scope, the basic idea is that financial institutions should be prohibited from undertaking certain potentially risky activities. Some proposals recommend reintroducing the separation between commercial and investment banking (as in the original Glass-Steagall Act). Others, such as the so-called “Volcker rule”, distinguish between client-service trading and proprietary trading, basically banning the latter. Criticism of these proposals is three-fold: (i) the separation between commercial and investment banking is much more suitable to remove a conflict of interests rather than reduce credit risk; (ii) the major risk for commercial banking is, after all, credit risk; and (iii) in practice, it is difficult to delineate between proprietary trading and trading to hedge risk.

As proved by the experience gathered from the `30s to the `60s, it can provide financial stability at the expense of future productivity and living standards. To quote Andrew Crockett again, “We should be careful that greater safety in banking is not purchased at the cost of reduced efficiency or additional risks elsewhere in the system”. Second, proper functioning of markets requires adequate rules. To me, it seems that something was wrong not only with markets themselves, but with the way they were regulated. Regulation did not pay enough attention to problems that may appear when markets operate. Andrew Crocket explained that the “market mechanism failed because of perverse incentive, asymmetric information and conflict of interests”. This means that, as Tommaso Padoa-Schioppa described it a few years ago, this crisis is not only a failure of markets, but also a failure of governments and regulators. In my view, free markets work properly given a set of good rules. It is natural for human beings to make free choices. It is the regulators` duty to design rules that always preserve this freedom while preventing, for as long as possible, the accumulation of problems from asymmetric information, perverse incentive and conflict of interests. The two approaches of regulation – the one up to the `60s and the one before the outbreak of the current crisis – are a proper basis for understanding what good rules might mean. III.
Policy agenda Our immediate focus must be to limit the damage of the financial crisis on the real economy, and stop the downward spiral created by the negative feedback loop. Policy measures must include not just fiscal and monetary policy stimulus, but also an acceleration of structural changes to correct the underlying imbalances, to put the global economy on a sounder footing for renewed growth. There has also been much discussion about regulatory reform. Reform is certainly necessary, but we must avoid swinging the regulatory pendulum to the other extreme. While the present system has major flaws, it is not fundamentally broken. Fixing these flaws demands thoughtful and pragmatic changes at the global level. Piecemeal quick fixes, which may be logical and perhaps even headline grabbing, may end up creating unforeseen and unintended consequences. It would be a mistake, for instance, to swing towards overly prescriptive rules, or to severely restrict all forms of securitisation and financial innovation. As financial markets are at different stages of development in various countries, we must also avoid a “one-size-fits-all” approach. Certainly, we will need greater international cooperation, and the work of bodies such as the IMF, FSF, BCBS, IOSCO, IAIS, 3 and initiatives sponsored by groupings such as the G20 will be important in this reform effort. An effective regulatory framework for Islamic finance The current global crisis has posed a series of extreme stress tests on financial systems and our regulatory approaches, and offers many important pointers for the development of Islamic Finance.

In such a transaction, banks generally purchase the asset to be financed, and then sells it to the customer at a mark-up, to be paid on a deferred basis. 6  IFSB - Islamic Financial Services Board; IDB – Islamic Development Bank; AAOIFI - Accounting and Auditing Organisation for Islamic Financial Institutions; IIFM - International Islamic Financial Market. 7  The Bahrain Monetary Agency was the primary sponsor in establishing the Liquidity Management Centre. 4  BIS Review 147/2008  Financial Services Board Summit, Singapore's plan to set up a facility to provide Shariahcompliant regulatory assets to these financial institutions as part of our efforts to promote the growth of Islamic Finance in Singapore. The sukuk structure is based broadly on the Al-Ijarah structure, or the sale-and-leaseback of an underlying property. Sukuk issued by the facility will be given equal regulatory treatment as Singapore Government Securities, or SGS, and returns will be tied to the risk-free yield of SGS of equivalent tenor. The facility is open to all financial institutions that plan to or are currently carrying on Shariah-compliant financial services in Singapore. We are issuing on a reverse enquiry basis, which means we can size and time the issuance according to the needs of the financial institutions. A number of financial institutions have already expressed interest and we expect the first issue to take place at the start of next year. We invite eligible and interested financial institutions to approach MAS as we work towards a formal launch.