samchain/econo-pairs-v1 huggingface dataset:
The stability charts – 3a and 3b – show the stability of growth and inflation in the G7 countries in the two time periods. In these charts a good performance is to be near the origin of the axes, close to the bottom left hand corner of the chart. The rather poor performance of the United Kingdom prior to 1997 is evident, as is the remarkable degree of stability in the United Kingdom relative to the rest of the G7 after that date. Of course, correlation does not imply causation. And there is little reason to suppose that the MPC is responsible for the higher average growth rate over the past decade. That more likely reflects structural changes in the UK economy, associated with other policy reforms. It is the stability of the UK economy which appears to be the most marked contribution of the MPC. That is a surprise. The conventional wisdom is that, although there is no long-run trade-off between the levels of inflation and output growth, there is a trade-off between the stability of inflation and of output growth. Inflation can be kept closer to the target only by larger changes in interest rates and bigger fluctuations in output growth. Policy-makers thus face a choice between different combinations of inflation and output growth volatility, which, when plotted on a chart, describe a “stability possibility frontier”.5 They can choose a point on that frontier depending on the relative importance they place on stabilising inflation and output growth, but they cannot move inside it.

With our range of publications, films, the competition for schools Target 2.0, and our programme of regular regional visits, the Bank of England invests a good deal of resources in achieving this objective. We also monitor progress using opinion polls and report regularly their findings. Building a large constituency for price stability is an essential part of convincing people that low and stable inflation will be at the heart of macroeconomic policy for the indefinite future. For the MPC, there is the specific task of explaining that by price stability we mean our target of 2% inflation as measured by the CPI. The second task relates to communication about the reasons for monetary policy decisions to financial markets, households and businesses. No communications strategy can ignore the fact that the Monetary Policy Committee was set up precisely because there is no timeless “reaction function” to be communicated to the public. It is as important to explain what we don’t know as what we do know. We are trying to get across the fruits of our learning about the economy, not a static view of the world. Our aim is to help people understand the thinking behind the Committee’s decisions, the various hypotheses that the Committee entertains about the current conjuncture and the data that we shall be examining in order to discriminate among them. That should help people work out how we are likely to react to future data as they come in.
By working together to set and voluntarily commit to baseline standards, the industry can demonstrate its readiness for a more risk-based regulatory approach. I hope that the industry will adopt these standards and this means moving beyond symbolic gestures, to the diligent implementation of policies and programmes that promote the desired culture. Bank Negara is also committed to ensuring that regulatory requirements support the country’s digital economy agenda. We are in the midst of developing e-KYC policy guidance to streamline practices of industry players in leveraging new technology. The guidance will clarify desirable outcomes of e-KYC adoption, and set out best practice as well as standardised parameters to measure effectiveness of e-KYC solutions. Our hope is that with its promise of seamless digital on-boarding of customers and lower costs, increased prevalence of e-KYC will help increase competition while also advancing the financial inclusion agenda – and this must be done without compromising on financial integrity outcomes. We will consult the industry and other relevant parties through the publication of an exposure draft early December this year. Third, we must strengthen our defences in view of new risks and changing environment. Recent years have seen authorities across the globe intensifying action against financial institutions for harbouring criminal activity. We see multi-billion dollar fines and all forms of regulatory sanctions, with some facing the threat of closure. On our part, Bank Negara will continue to use supervisory levers to sustain positive changes and drive improvements in the compliance culture in the industry.

Thank you. 3/3  BIS central bankers' speeches
The many differences in the speed of the economic recovery in the world has combined with foreign exchange tensions and, in the past few months, increased inflationary pressures at the global level. Food prices, responding to the stronger demand of emerging economies and to worsened supply-side conditions, have skyrocketed, rising even faster than between early 2007 and mid-2008. Add to this the sustained increase in the oil price since mid-2010, which intensified last February because of the political unrest in the Middle East and Northern Africa. BIS central bankers’ speeches  1  Under these circumstances, today monetary policy faces an important challenge. Like after the global financial debacle of 2008, when it was highly flexible in responding to the confidence crisis around the world, now it must again be flexible in withdrawing the monetary stimulus, creating the conditions for sustainable growth and acting preventively to avoid a resurgence of inflation. Since last December, the Board has raised the monetary policy interest rate (MPR) by 75 basis points to 4 percent in the meeting of last March. In the scenario we consider the most likely, we will continue to remove the monetary stimulus, at a pace that will depend on unfolding macroeconomic conditions, but which will be principally oriented to achieving the inflation target. Now let me describe the factors that underlie the most likely scenario and the main risks it faces.

And this is why we are seeing increased vigilance by regulators and the financial institutions themselves, in terms of the rigour in the use of stresstests, which is essential in the environment of heightened volatility that superseded historical norm. The implementation of Pillar II is, however, a challenge, not only in terms of the technical and quantitative expertise for reviewing Internal Capital Adequacy Assessment Process, or ICAAP, but also on qualitative aspects such as how to foster an on-going two-way dialogue with the supervised institutions that would enhance the ICAAP process. To meet this challenge, regulators need to establish a strong credibility so as to strengthen the impact of their recommendations and requirement on ICAAP, and in some cases, increase capital  BIS Review 56/2009  1  requirement to ensure capital appropriate to the material risks, not yet covered in Pillar I. Also, there are challenges on the legal and institutional capacity aspects on how to handle the more principle-based, and therefore, more institution-specific regulatory requirement. As for the Bank of Thailand, our progress on Pillar II implementation is continuing. By working closely with all stakeholders especially Thai Bankers, Association, we have issued three prudential guidelines for Basel II since 2006. Pillar II formally took effect the end of last year, while Pillar III will be implemented in June this year. As far as Pillar II is concerned, we expect Thai banks to put in place the ICAAP within this year and establish the comprehensive process by the end of next year.
In addition to protecting customer rights, the legal and regulatory framework should keep pace with changing circumstances and promote innovation and integration to suit customer needs. There should also be regulatory provisions to remove any restrictions to market entry and product development, especially for those who try to link retail payment instruments with the high value payment systems. 4.3.7 Setup standards and governance structure: International standards and practices have been established for credit and debit cards. The joint efforts for introducing micro processing chip or tamper proof cards and security solutions in the credit and debit cards should be encouraged to foster Internet payments. Setting standards by the authorities would promote developing off the shelf software solutions to automate systems and integrate different systems. The general guidelines for retail payments development issued by the Bank for International Settlements in 2005 sets out guidelines, but they are basically policy or regulatory related matters. The information technology industry needs to take an initiative in preparing guidelines and governance structures to meet standards on a self-regulatory basis. 6  BIS Review 61/2008  4.3.8 Operational elements: The framework should set out operational responsibilities for the other stakeholders. The most important of these are i. Explore new technological capabilities: Policy makers and regulators should attempt to discourage preference by vendors, system operators, financial institutions, service providers and users in defending inefficient and old systems, which have hidden benefits or other comforts.

6.4 The NPCs and the regulatory bodies should make all attempts to persuade retail payment service providers to use common national and inter-regional and infrastructure and fostering the standardization and harmonization of retail payment systems. The high cost involved in retail payment systems processes is not necessarily due to the large volumes or the wide array of payment instruments, but due to the use of a large number of proprietary infrastructure systems by service providers and the passing on of these high costs to users. While introducing customer-centric products, it is important to ensure that customers are protected and their rights are preserved. I hope some of the opportunities mentioned above and many others that will be highlighted during the rest of this Summit will be taken up by the banking community and service providers and that they will work closely with the SPC to take the region’s payment system development process forward. Thank you. 8  BIS Review 61/2008
This is an uncomfortable basis for a forecast of a benign adjustment process, not least because at some point the interests of those on one side of the balance may change. I think this mix of challenges in our fiscal and external positions deserve concern and attention. They may end up being diffused gradually and benignly, but they necessarily bring with them a greater risk of higher risk premia, a more adverse investment environment and poorer growth outcomes. Under some circumstances, this could undermine an important foundation of the environment for innovation that has delivered our productivity acceleration. What can we do to mitigate the risks in this constellation of forces? We can work to keep monetary policy credible, to preserve confidence we will act to keep inflation and inflation expectations stable at moderate levels. We can act to raise public sector savings, begin to bring our entitlement commitments and our resources closer into balance and build a greater financial cushion into our financial future against the risk of a less benign world. We can make sure we keep our markets open, and to support rather than resist the integration of China and India into the world economy. We can work to make sure that our financial system remains strong, with a substantial capital and liquidity cushion, a more resilient infrastructure and continued rapid innovation in financial intermediation. And we can work to improve educational opportunities in this country, to improve educational achievement and to improve public awareness of economics and finance.

Timothy F Geithner: Economic policy and the sustainability of US productivity growth Remarks by Mr Timothy F Geithner, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Puerto Rico Bankers Association Luncheon, New York, 12 April 2005. *  *  *  Thank you for the opportunity to speak to you today and to support the important work of improving economic and financial education. I am going to focus my remarks on two important dimensions of our economic future - the acceleration in the rate of growth in productivity of the past decade and the more recent decline in our net national savings rate. The former offers considerable promise for future growth in the living standards in the United States. The latter presents some risk and challenges to that brighter prospect. Both are areas where education, education in general and financial education in particular, can make an important contribution. The United States has been through an exceptionally good decade of economic performance. While growth in most mature economies slowed, we averaged a respectable 3.5 percent growth in real GDP a year. Inflation moderated to a rate of around 2 percent, and long term inflation expectations stayed stable for some time at quite moderate levels. The volatility of U.S. output, which declined significantly in the mid-1980s, remained low, meaning growth was smoother, with recessions less frequent, shorter and shallower.
•  Effective challenge – including transparency and open dialogue across and between the board and senior management and senior management and staff. •  And, finally, incentives – both compensation and talent development/promotion processes. Supervision in this area involves an assessment of the effectiveness of a financial institution’s governance, including the extent to which the board and senior management demonstrate effective behaviors that contribute to good governance. This includes consideration of the behavioral dynamics of the board and senior management, such as how the “tone at the top” and the cultural values of a bank are communicated and put into practice, how information flows to and from the board and senior management, and how potentially serious problems are identified and addressed throughout the organization. I think the FSB’s document sets out a good set of reference points for supervisors – and for firms – to explore in evaluating risk culture. As has been noted by others – and is emphasized in the FSB’s guidance – assessing culture is not a single point in time event. It should be a regular and ongoing exercise that management teams, boards of directors and supervisors conduct, taking the range of feedback from interactions and work conducted inside the firm, interactions and reactions from the firm’s senior management team, and interactions and dialogue with the board of directors. Alongside risk culture, much work has been done on the roles and responsibilities of boards of directors. The G30 has issued two reports in the last two years.

The role of supervisors – in-house initiatives As well as these initiatives, which may be considered external, we are also working in the Banco de España to adapt to this new reality. Firstly, we have created an internal function entrusted with assessing the impact we as an institution have on the environment. The aim is to articulate and coordinate the necessary measures to reduce that impact. Secondly, as a macroprudential supervisor, we clearly need to be able to assess and quantify the risks that the transition towards a more sustainable economy poses, both for individual banks and the financial sector as a whole. Among other functions, we need to be able to assess the level of financial institutions’ exposure to high-carbon emission activities, perform stress tests for the financial system overall and define scenarios and methodologies to be applied by banks individually. In consequence, we are designing internal governance structures and methodologies, actively participating in the cultural shift in the SSM supervisory model. Naturally, we are also evaluating the information and data requirements needed to address this challenge. Nor should we forget that central banks are also important investors in the debt markets, both in the area of monetary policy and reserve management. Although we have not yet included environmental risk assessment in our credit analysis, we are working to remedy this. 5  ESG - Environmental, Social and Governance.
It is expensive to use, however, and in one way or another we all as bank customers pay for the use of it. For reasons of security and efficiency in retail payments, a more widespread use of cards would be desirable. Forces driving the development of the card payment market The forces of supply and demand shape the evolution of the card payment market in much the same manner as they influence the evolution of any other market. Demand is influenced by factors such as acceptance, convenience and relative prices. It has sometimes been argued that demand for payment instruments is not price elastic - that relative prices 1 do not greatly influence users' preferences for different payment instruments. The Nordic experience does not support this view. The rapid expansion of card payments and other electronically initiated instruments in Norway clearly point in a different direction. Norwegian consumers' shift of preferences followed immediately after banks' change of pricing strategy, where (among other changes) a price was put on the use of cash (as a small fee on ATM withdrawals). In Sweden, as previously noted, the use of checks fell sharply when banks started to charge for their use, although the charge was fairly small. Of course, good substitutes must be readily available. But if alternative ways of payment are present, fees seem to matter and matter a lot.

When prices for retail services, such as the use of cards or cash, are transparent and reflect the cost of production, they give incentives to efficient use of each instrument. Again, if actual costs of cash services were transparent to consumers and if the use of cash was priced according to the cost of providing cash services, the use of cards would probably increase substantially. I am sure that we will move in that direction, even though consumer acceptance of paying for the use of cash will increase only at a slow pace. Thank you.
Some observers thus claim that the lack of co-ordination between European economic policies, in the absence of a political federation, is likely to deprive the area of an appropriate policy-mix. Others blame the lack of instruments allowing us to tackle any asymetric shocks that may emerge, and underline the poor flexibility or the absence of mobility of the European labour force. Others claim that the presumed economic divergences and structural gaps among euro area countries are too large to ensure a viable monetary union. …appears invalid from an economic standpoint How can we address these important objections? It is not disputable that for EMU to function well, Member States, especially the major ones in terms of GDP, must be aware of the spill-over effects of all their national budgetary policies. The existence of spill-over justifies the implementation of close co-ordination between national economic policies. This is contained in the Treaty itself, which obliges Member States to treat national economic policies “as a matter of common concern” and subjects them to a multilateral procedure. In this regard, we have seen that for EMU to be successful, an appropriate level of co-ordination between economic policies is needed. To this end, Member States have designed institutions and mechanisms to promote the level of co-ordination. We can now say that EMU has in turn been beneficial to the European economic and financial integration as a whole.

Let me now give you an example of that approach, one which illustrates how important it is to identify and manage risks before they become so big that they can hardly be managed at all. And it illustrates the potential of risk managers to act as spoilsports in the short term, while preserving the sustainability of business models in the long term. I am referring to leveraged finance, which comprises instruments such as high-yield bonds and leveraged loans. 2  BIS central bankers’ speeches  Assessing risks – the issue of leveraged finance The market for leveraged finance is certainly a market with potential – with potential that other markets can only dream of. After contracting sharply during the financial crisis, it has expanded rapidly in recent years, not least driven by a search for yield against the backdrop of a prolonged period of very low interest rates. According to a study by Crédit Suisse, the global market for leveraged finance grew by almost 42% between 2011 and 2014. Banks in the euro area followed that trend – between 2012 and 2014, they increased their exposures to leveraged loans by 16%. Do I worry about leveraged finance in the euro area? By comparison, the share of euro area banks in the global market for leveraged finance remains limited. In 2014, banks in the euro area accounted for no more than about 15% of all leveraged loans that were arranged at the global level. At the same time, leveraged finance accounts for just 1% of their assets.
Goh Chok Tong: Staying ahead of the Asian curve Speech by Mr Goh Chok Tong, Senior Minister of the Republic of Singapore and Chairman of the Monetary Authority of Singapore, at Barclays Asia Forum, Singapore, 1 November 2007. *  *  *  I extend a warm welcome to all of you, especially to those who have not come to Singapore in recent years. I would also like to thank Barclays for organising this Asia Forum as well as this weekend’s Singapore Open. I hope the Singapore Open will grow in prestige as you expand your presence in Singapore and Asia. Singapore’s economic growth rates in the past few years have surprised many, including ourselves. We did not expect to be able to consistently achieve growth rates of above 6% per annum as we are a mature economy. Yes, we have remade our economy but the good growth was also due to the buoyant world economy and a surging Asia. Singapore’s future growth will depend not only on our own efforts but also on our ability to anticipate trends in our external environment and stay ahead of the curve. This morning, I would like to share with you how we see developments in Asia and the challenges before us. Political outlook Let me start with the political outlook. I believe that Asia will remain stable and the regional environment conducive to growth. Post-9/11, the world had to adjust to new insecurities posed by terrorism.

However, I believe that Asia should press on with its efforts to develop their capital markets in order to complement the banking system and improve the robustness and efficiency of its financial system. Second, as we pursue financial sector development, we will also see more sophisticated products coming to the fore. Market players and regulators alike must refine their understanding of the attendant risks; in particular, how shocks may be transmitted through such products. We must then develop tools to manage such risks. Indeed, much of the recent financial dislocation stemmed from opacity in the distribution and pricing of risks for derivative products. The key lessons include the need to monitor off-balance sheet exposures and to institute better management and supervision of liquidity risks. Addressing these issues will not be easy as we must avoid imposing excessive regulatory burden on market players or stifling financial innovation. Third, as growing inter-dependence is a reality, the central bank, the financial regulator and the guardian of the public purse must work in close coordination. They must also work with key counterparts in other jurisdictions. One key issue which requires particular attention is the establishment of crisis management and resolution frameworks to minimise systemic fallout should financial institutions run into trouble. 2  BIS Review 124/2007  Other challenges to sustained growth Looking ahead, Asia faces other challenges to sustained growth. First, global financial imbalances pose political and economic risks.